Money

Uh Oh – Italy Is Coming Apart Like A 20 Dollar Suit

Did anyone really think that Italy would be able to get through this thing without needing a bailout?  Just when you thought that things in Europe could get back to normal for a little while, here comes Italy.  On Friday, there was a bit of a “mini-panic” as investors started dumping Italian financial assets.  European officials are concerned that the sovereign debt crisis that has ravaged Greece, Ireland and Portugal will now put the Italian economy through the wringer.  European Council President Herman Van Rompuy has called an emergency meeting for Monday morning.  He is denying that the meeting is about Italy, but everyone knows that Italy is going to be discussed.  European Central Bank President Jean-Claude Trichet and European Commission President Jose Manuel Barroso along with a host of other top officials will also be at this meeting.  If it does turn out that Italy needs a bailout, it is going to change the entire game in Europe.

What is going on in Italy right now is potentially far more serious than what has been going on in Greece.  Italy is the fourth largest economy in the European Union.  If Italy requires a bailout, the rest of Europe might not be able to handle it.

An anonymous European Central Bank source told one German newspaper the following on Sunday….

“The existing rescue fund in Europe is not sufficient to provide a credible defensive wall for Italy”

The source also added that the current bailout fund “was never designed for that“.

Italy has already implemented austerity measures.

This was not supposed to happen.

But it is happening.

This latest crisis was precipitated by a substantial sell-off of Italian financial assets on Friday.  An article posted by Bloomberg described the pounding that the two largest Italian banks took….

UniCredit SpA (UCG) and Intesa Sanpaolo SpA (ISP), Italy’s biggest banks, fell to the lowest in more than two years in Milan yesterday as contagion from Europe’s debt crisis threatened to spread to the region’s third-largest economy.

UniCredit plunged 7.9 percent, the biggest decline since March 30, 2009, while Intesa dropped 4.6 percent. Both hit lows not seen since the period when markets were emerging from the crisis spawned by the collapse of Lehman Brothers Holdings Inc.

Unfortunately, this is just the continuation of a trend that has been going on for a while.

When you look at them as a group, the stocks of the five largest Italian banks have lost 27% since the beginning of 2011.

That is not a good sign.

Also, investors are starting to dump Italian government debt.  Reuters says that the yield on 10 year Italian bonds is approaching the danger zone….

The spread of the Italian 10-year government bond yield over benchmark German Bunds hit euro lifetime highs around 2.45 percentage points on Friday, raising the Italian yield to 5.28 percent, close to the 5.5-5.7 percent area which some bankers think could start putting heavy pressure on Italy’s finances.

The Italian national debt is now up to about 120 percent of GDP.  The Italian government would be able to manage it if interest rates were very, very low.  But unfortunately they are rising fast and if they get too much higher they are going to become suffocating.

As I have written about previously, government debt becomes very painful once you take low interest rates out of the equation.  For example, if Greece could borrow all of the money that it wanted to borrow at zero percent interest, it would not have a debt problem.  But now the yield on 2 year Greek bonds is over 30 percent, and there is not a government on the face of the earth that can afford to pay interest that high for long.

Unfortunately for Italy, this could just be the beginning of rising interest rates.  Just recently, Moody’s warned that it may be forced to downgrade Italy’s Aa2 debt rating at some point within the next couple of months.

If things continue to unravel in Italy, all of the credit agencies may downgrade Italy sooner rather than later.

The frightening thing about Italy is that a financial crisis has a way of exposing corruption, and there are very few countries that can match the kind of corruption that goes on in Italy.

As a child, I had the chance to live in Italy.  I love Italy.  The people are friendly, the weather is great, the architecture is amazing and the food is spectacular.  I will always have great affection for Italy and I will always cheer for the Italian national team when the World Cup rolls around.

However, I also know that corruption is deeply ingrained into Italian culture.  It is simply a way of life.

Just check out the prime minister of Italy.  Silvio Berlusconi is the consummate Italian politician.  He is greatly loved by many, but it would take days to detail all of the scandals that he has been linked to.

At this point, Berlusconi has become a parody of himself.  Each new sex scandal or financial scandal just adds to his legend.  Italy is one of the only nations in Europe where such a corrupt politician could have stayed in office for so long.

Not that the U.S. government is much better.  Our government becomes more corrupt with each passing year.

But the point is that if a financial collapse happens in Italy and people start “turning over rocks” it could turn up all sorts of icky stuff.

So what is Europe going to do if Italy needs a bailout?

Well, they are probably going to have to fire up the printing presses because it would probably take a whole lot more euros than they have right now.

The truth is that the EU has now entered a permanent financial crisis.  You have a whole bunch of nations that have accumulated unsustainable debts and that cannot print their own currencies.  The financial system of the EU as it is currently constructed simply does not work.

Some believe that the sovereign debt crisis will eventually cause the breakup of the EU.  Others believe that this crisis will cause it to be reformed and become much more integrated.

In any event, what just about everyone can agree on is that the financial problems of Europe are not going away any time soon.  For now, EU officials are keeping all of the balls in the air, but if at some point the juggling act falters, the rest of the world better look out.

A financial crash in Europe would be felt in every nation on earth and it would be absolutely devastating.  Let’s hope that we still have some more time before it happens.

Number One? 20 Not So Good Categories That The United States Leads The World In

Is the United States “number one”?  Many Americans take deep pride in their nation and the truth is that the U.S. has a lot going for it.  The United States has the largest economy in the world.  The United States also has the most powerful military on the entire planet.  The United States has produced most of the greatest movies that the world has ever seen.  But the United States is also number one in a lot of categories that are not go great.  If we ever want to turn this country around, we need to be very honest with ourselves.  We need to take a long, hard look in the mirror and realize that it is not a good thing that we are number one in divorce, drug addiction, debt, obesity, car thefts, murders and total crimes.  We have become a slothful, greedy, decadent nation that is exhibiting signs of advanced decay.  Until we understand just how bad our problems really are, we won’t be able to come up with the solutions that we need.

A lot of people that write articles like this have a deep hatred for America.  But that is not the case with me.  I love the United States.  I love the American people.  America is like an aging, bloated rock star that has become addicted to a dozen different drugs.  America is a shadow of its former self and it desperately needs to wake up before it plunges into oblivion.

If you do not believe that America is in bad shape, just read the list below.  The following are 20 not so good categories that the United States leads the world in….

#1 The United States has the highest incarceration rate in the world and the largest total prison population on the entire globe.

#2 According to NationMaster.com, the United States has the highest percentage of obese people in the world.

#3 The United States has the highest divorce rate on the globe by a wide margin.

#4 The United States is tied with the U.K. for the most hours of television watched per person each week.

#5 The United States has the highest rate of illegal drug use on the entire planet.

#6 There are more car thefts in the United States each year than anywhere else in the world by far.

#7 There are more reported rapes in the United States each year than anywhere else in the world.

#8 There are more reported murders in the United States each year than anywhere else in the world.

#9 There are more total crimes in the United States each year than anywhere else in the world.

#10 The United States also has more police officers than anywhere else in the world.

#11 The United States spends much more on health care as a percentage of GDP than any other nation on the face of the earth.

#12 The United States has more people on pharmaceutical drugs than any other country on the planet.

#13 The percentage of women taking antidepressants in America is higher than in any other country in the world.

#14 Americans have more student loan debt than anyone else in the world.

#15 More pornography is created in the United States than anywhere else on the entire globe.  89 percent is made in the U.S.A. and only 11 percent is made in the rest of the world.

#16 The United States has the largest trade deficit in the world every single year.  Between December 2000 and December 2010, the United States ran a total trade deficit of 6.1 trillion dollars with the rest of the world, and the U.S. has had a negative trade balance every single year since 1976.

#17 The United States spends 7 times more on the military than any other nation on the planet does.  In fact, U.S. military spending is greater than the military spending of China, Russia, Japan, India, and the rest of NATO combined.

#18 The United States has far more foreign military bases than any other country does.

#19 The United States has the most complicated tax system in the entire world.

#20 The U.S. has accumulated the biggest national debt that the world has ever seen and it is rapidly getting worse.  Right now, U.S. government debt is expanding at a rate of $40,000 per second.

So are you convinced that we are in trouble yet?

The truth is that America has changed.  Most of us don’t even say hello to our neighbors anymore.

In fact, we have become so self-involved that many of us don’t even notice when someone around us dies.

Just consider the following two examples.

*USA Today recently reported on the body of a dead woman that was not found for approximately a year even though a whole bunch of people walked right past the car where she died….

Bank contractors, inspectors and even the new owner of a foreclosed home walked past the silver Chevy Nova in the garage numerous times before discovering the former homeowner — dead on the front seat.

*In an even more shocking case, the CBS affiliate in Boston recently reported that a dead woman was lying on the bottom of a public pool for two days while large numbers of people swam right over her.  How in the world could something like this possibly happen?….

It’s a mystery as murky as the water at Veteran’s Memorial swimming pool in Fall River public pool: how did swimmers, lifeguards, or inspectors not notice a woman’s body at the bottom of the pool for a few days?

Marie Joseph, 36, was last seen at the pool on Sunday. The pool was open to the public Monday and Tuesday with six lifeguards on duty, and no one noticed the body under 12 feet of water.

Most Americans have become so self-involved that they barely even notice anyone other than their family and close friends.

The love of most Americans is growing cold and when the collapse of the U.S. economy happens it is just going to make things worse.  Instead of working as a community, most Americans will only be concerned with making sure that their own needs are taken care of.

The United States was once the most blessed nation on the face of the earth, but now we are literally falling to pieces.

Does anyone have any ideas about why this could be happening?

 

50 U.S. Health Care Statistics That Will Absolutely Astonish You

The U.S. health care system has become one gigantic money making scam, and you are about to see the statistics that prove it.  Today, the United States spends more on health care per person than any other country in the world by far.  The health insurance companies and the big pharmaceutical corporations are raking in gigantic mountains of cash and yet the quality of the health care that we receive in return is rather quite poor.  People living in Puerto Rico have a greater life expectancy than we do.  Residents of Cuba have a lower infant mortality rate than we do.  We are the most medicated population on the planet and yet we are also one of the sickest.  If the U.S. health care system was a country, it would have the 6th largest economy on the globe and yet rates of cancer, heart disease and diabetes continue to increase.  The U.S. health care statistics that you are about to read below are absolutely stunning.  For as much money as we shell out for health care, we should have the greatest system in the entire world.  But we don’t.  Something has gone horribly wrong.

As you read this, there are hordes of health bureaucrats and greedy corporate fatcats that are becoming incredibly wealthy while the rest of us go broke trying to pay for our health care.  In the United States today, health care bills cause more bankruptcies than anything else does.  Millions of Americans are afraid to go to the hospital because they know that even a short visit would be a huge financial burden.

Sadly, our politicians in Washington D.C. continue to make the problem worse.  Obamacare was one of the worst pieces of legislation that anyone has ever come up with in the history of the United States.  You could put a thousand monkeys in a room with a thousand typewriters for a thousand years and they wouldn’t come up with anything as bad as Obamacare.  Rather than doing something to address the abuses of the health insurance companies and the pharmaceutical corporations, Obamacare actually gives them more power.  In fact, huge portions of Obamacare are virtually identical to a bill that was written by the health insurance trade association in 2009.  Under Obamacare our health care costs will go up even faster and the quality of our health care will continue to go down.  So please don’t try to tell me that Obamacare is the solution to anything.

The health care system in the United States is so broken that it probably cannot be repaired.  The entire thing needs to be dismantled and completely reinvented.

If you doubt this, just check out the stats that I have compiled below.

As I put together this list of statistics, Business Insider proved to be a very valuable resource.  In addition, I relied heavily on the following articles which I previously authored….

*25 Shocking Facts That Prove That The Entire U.S. Health Care Industry Has Become One Giant Money Making Scam

*18 Ridiculous Statistics About Medical Bills, Medical Debt And The Health Care Industry That Will Make You So Mad You Will Want To Tear Your Hair Out

*The Coming Doctor Shortage

The following are 50 U.S. health care statistics that will absolutely astonish you….

#1 What the United States spent on health care in 2009 was greater than the entire GDP of Great Britain.

#2 According to the Bureau of Economic Analysis, health care costs accounted for just 9.5% of all personal consumption back in 1980.  Today they account for approximately 16.3%.

#3 The United States spent 2.47 trillion dollars on health care in 2009.  It is being projected that the U.S. will spend 4.5 trillion dollars on health care in 2019.

#4 One study found that approximately 41 percent of working age Americans either have medical bill problems or are currently paying off medical debt.

#5 According to a report published in The American Journal of Medicine, medical bills are a major factor in more than 60 percent of the personal bankruptcies in the United States.  Of those bankruptcies that were caused by medical bills, approximately 75 percent of them involved individuals that actually did have health insurance.

#6 Over the past decade, health insurance premiums have risen three times faster than wages have in the United States.

#7 The chairman of Aetna, the third largest health insurance company in the United States, brought in a staggering $68.7 million during 2010. Ron Williams exercised stock options that were worth approximately $50.3 million and he raked in an additional $18.4 million in wages and other forms of compensation.  The funny thing is that he left the company and didn’t even work the whole year.

#8 The top executives at the five largest for-profit health insurance companies in the United States combined to receive nearly $200 million in total compensation for 2009.

#9 Even as the rest of the country struggled with a deep recession, U.S. health insurance companies increased their profits by 56 percent during 2009 alone.

#10 According to a report by Health Care for America Now, America’s five biggest for-profit health insurance companies ended 2009 with a combined profit of $12.2 billion.

#11 In the United States, health insurance administration expenses account for 8 percent of all health care costs.  In Finland, that figure is just 2 percent.

#12 Health insurance rate increases are getting out of control.  According to the Los Angeles Times, Blue Shield of California announced plans earlier this year to raise rates an average of 30% to 35%, and some individual policy holders were slated to see their health insurance premiums rise by up to 59 percent.

#13 According to an article on the Mother Jones website, health insurance premiums for small employers in the U.S. increased 180% between 1999 and 2009.

#14 Since 2003, health insurance companies have shelled out more than $42 million in state-level campaign contributions.

#15 There were more than two dozen pharmaceutical companies that made over a billion dollars in profits each during 2008.

#16 Each year, tens of billions of dollars is spent on pharmaceutical marketing in the United States alone.

#17 Prescription drugs cost about 50% more in the United States than they do in other countries.

#18 Nearly half of all Americans now use prescription drugs on a regular basis according to a CDC report that was recently released. According to the report, approximately one-third of all Americans use two or more pharmaceutical drugs, and more than ten percent of all Americans use five or more drugs on a regular basis.

#19 According to the CDC, approximately three quarters of a million people a year are rushed to emergency rooms in the United States because of adverse reactions to pharmaceutical drugs.

#20 The Food and Drug Administration reported 1,742 prescription drug recalls in 2009, which was a gigantic increase from 426 drug recalls in 2008.

#21 Children in the United States are three times more likely to be prescribed antidepressants than children in Europe are.

#22 The percentage of women taking antidepressants in America is higher than in any other country in the world.

#23 Lawyers are certainly doing their part to contribute to soaring health care costs.  According to one recent study, the medical liability system in the United States added approximately $55.6 billion to the cost of health care in 2008.

#24 According to one doctor interviewed by Fox News, “a gunshot wound to the head, chest or abdomen” will cost $13,000 at his hospital the moment the victim comes in the door, and then there will be significant additional charges depending on how bad the wound is.

#25 Why are c-sections on the rise?  It is because a vaginal delivery costs approximately $5,992, while a c-section costs approximately $8,558.

#26 According to the CIA World Factbook, the United States had a higher infant mortality rate than 45 other nations in 2009.

#27 The infant mortality rate in the United States is nearly three times as high as it is in Singapore.

#28 It is estimated that hospitals overcharge Americans by about 10 billion dollars every single year.

#29 In fact, one trained medical billing advocate says that over 90 percent of all the medical bills that she has audited contain “gross overcharges“.

#30 It is not uncommon for insurance companies to get hospitals to knock their bills down by up to 95 percent, but if you are uninsured or you don’t know how the system works then you are out of luck.

#31 Over the last decade, the number of Americans without health insurance has risen from about 38 million to about 52 million.

#32 People living in the United States are three times more likely to have diabetes than people living in the United Kingdom.

#33 Today, people living in Puerto Rico have a greater life expectancy than people living in the United States do.

#34 According to OECD statistics, Americans are twice as obese as Canadians are.

#35 Back in 1965, only one out of every 50 Americans was on Medicaid.  Today, one out of every 6 Americans is on Medicaid.

#36 The U.S. government now says that the Medicare trust fund will run out five years faster than they were projecting just last year.

#37 It is being projected that the federal government will account for more than 50 percent of all health care spending in 2012.

#38 Greece has twice as many hospital beds per person as the United States does.

#39 The state of California now ranks dead last out of all 50 states in the number of emergency rooms per million people.

#40 According to one survey, approximately 1 out of every 4 Californians under the age of 65 has absolutely no health insurance.

#41 According to a PricewaterhouseCoopers report, “inefficient claims processing” costs the U.S. health care system 210 billion dollars every single year.

#42 Today, approximately 40% of all U.S. doctors are age 55 or older.

#43 According to the American Association of Medical Colleges, we were already going to be facing a shortage of more than 150,000 doctors over the next 15 years even before Obamacare was passed.

#44 An IBD/TIPP poll taken back in August 2009 found that 4 out of every 9 American doctors said that they “would consider leaving their practice or taking an early retirement” if Congress passed Obamacare.

#45 According to a survey published in the New England Journal of Medicine, approximately one-third of all practicing physicians in the United States indicated that they may leave the medical profession because of the new health care law.

#46 According to a Merritt Hawkins survey of 2,379 doctors that was conducted in August 2010, 40 percent of all U.S. doctors plan to “retire, seek a nonclinical job in health care, or seek a job or business unrelated to health care” at some point over the next three years.

#47 According to the executive director of Physician Hospitals of America, Obamacare has already forced the cancellation of at least 60 doctor-owned hospitals that were scheduled to open soon.

#48 According to a report released in 2010, Americans spend approximately twice as much as residents of other developed countries do on health care.

#49 If the U.S. health care system was a country, it would be the 6th largest economy in the entire world.

#50 According to numbers released by Deloitte Consulting, a whopping 875,000 Americans were “medical tourists” in 2010.

Barack Obama’s White House Rural Council: Central Economic Planning For America’s Heartland

Barack Obama has issued a brand new executive order that establishes a White House Rural Council.  This Rural Council has been given the task of developing “public-private partnerships” that will seek to bring the “economic prosperity” of our big cities to rural America.  In other words, the U.S. government and the big corporations are going to team up to dominate the economies of our small towns and rural communities just like they dominate the economies of all of our big cities.  So should those that live in rural America be excited about this?  After all, the U.S. government and the big corporations have done such a great job of bringing “economic prosperity” to places like Detroit, Michigan and Camden, New Jersey.  Won’t it be great to have the federal government come in and tell rural communities how they should be doing things?

The chair of the White House Rural Council will be Agriculture Secretary Tom Vilsack.  Vilsack is a former governor of Iowa and a Democrat.  Swing states like Iowa will be key in 2012, and so perhaps Obama is trying to show that he really cares for middle America.

But it is really hard to forget the remarks that Obama made about rural Americans during the 2008 campaign.

In particular, the following quote about the “bitterness” of those living in rural America got a lot of attention at the time….

“And it’s not surprising then they get bitter, they cling to guns or religion or antipathy to people who aren’t like them or anti-immigrant sentiment or anti-trade sentiment as a way to explain their frustrations.”

Look, the vast majority of the people who live in rural America do not want to hear that they need to let go of their guns or their religion.

And most of them certainly do not want the federal government to come in and tell them how to run their local economies.

But according to Obama, the U.S. government “has an important role to play” in managing the economies of rural communities.  The following is a direct quote from the executive order establishing the White House Rural Council….

Though rural communities face numerous challenges, they also present enormous economic potential. The Federal Government has an important role to play in order to expand access to the capital necessary for economic growth, promote innovation, improve access to health care and education, and expand outdoor recreational activities on public lands.

To many Americans, all of this will sound really great.  The federal government is going to come in and help the “backwoods folk” catch up with the rest of us.  What could be wrong with that?

Well, the truth is that whenever the federal government gets its fingers into something it tends to really mess it up.  Many of the biggest problems our country is facing today can be traced directly back to Washington D.C.

Many small towns and rural communities are doing just fine without the interference of the federal government.  In fact, large numbers of Americans have purposely moved out to rural areas because they don’t want the interference of the federal government in their lives.

But according to this new executive order, the Obama administration plans to stick its itchy little fingers into just about every aspect of rural life.  One of the stated goals of the White House Rural Council is to do the following….

coordinate and increase the effectiveness of Federal engagement with rural stakeholders, including agricultural organizations, small businesses, education and training institutions, health-care providers, telecommunications services providers, research and land grant institutions, law enforcement, State, local, and tribal governments, and nongovernmental organizations regarding the needs of rural America

This is yet another example of how we are rapidly becoming a centrally-planned economy.

Today, there are way too many Americans that expect the federal government to solve all their problems and take care of them from birth to death.

But that is not what our founding fathers intended, and our federal government has become so corrupt and so incompetent that it could not do those things even if we wanted it to.

Before the federal government “fixes” the problems of rural America, perhaps it should focus on “fixing” many of the other problems it has created first….

*Growing numbers of military veterans cannot find jobs once they leave the U.S. military.  In fiscal 2008, the Pentagon spent $450 million on unemployment benefits for military vets.  In fiscal 2010, the Pentagon spent almost twice as much – $882 million.  According to the U.S. Bureau of Labor Statistics, the unemployment rate for military veterans between the ages of 18 and 24 is more than 30%.

*The housing collapse that the Federal Reserve and the U.S. government caused is a nightmare that never seems to end.  According to the New York Times, at the current pace it will take 62 years for the banks to repossess all of the homes that are in severe default or foreclosure in the state of New York.

*The recent commodity price increases caused by the Federal Reserve have resulted in much higher prices at the gas pump and at the grocery store.  These higher prices are hitting the poor and the lower middle class much harder than they are hitting the wealthy.

*The federal government has piled up the biggest debt in the history of the world and the U.S. dollar is dying.  Standard & Poor’s has altered its outlook on U.S. government debt from “stable” to “negative” and is warning that the U.S. could soon lose its prized AAA rating.  Russian presidential economic adviser Arkady Dvorkovich says that his nation is going to keep dumping U.S. government debt.  China has been dumping U.S. government debt.  The entire U.S. financial system is on the verge of financial collapse and the federal government seems to be powerless to make any meaningful changes.

But instead of fixing the glaring problems that are staring them directly in the face, the control freaks and the bureaucrats in Washington D.C. seem obsessed with figuring out more ways to interfere in our lives.

Over the past couple of months, bad economic news has been pouring in almost constantly.  Our economy appears to be in danger of breaking apart.  We are in the midst of a horrific economic crisis and nobody is sure what is going to happen next.

So please excuse the good folks of rural America if they are not in the mood to put up with federal government interference in their communities.

The federal government has failed so dramatically so many times before that it is really hard to have any faith that the federal government can do much of anything right at this point.

A Glimmer Of Hope

If you want to feel better about America, just spend some time in some of the really great small towns and rural communities that are scattered across this country.  Over the past several days, that is exactly what I had the privilege to do.  I have often written about how the “America” that so many of us love is fading away, but in many small towns throughout the United States that “America” is still very much alive.  The truth is that there are millions of Americans that still place a tremendous amount of value on God, family and country.  My wife and I are accustomed to big city ways, and so we were amazed at how friendly and how open the people that we encountered during our travels were.  A lot of times the elitists that run this country look down their noses at those that live in rural communities and small towns, but the reality is that those are some of the greatest people this country has.

Did you know that there are still some Americans in 2011 that do not lock their homes or their cars?

It’s true – my wife and I met some of these people during our travels.  They do not fear crime because very, very little crime ever happens where they live.

Of course if someone does try to rob them, let’s just say that the thieves would be in for some very unpleasant surprises.

My wife and I have also found that people in small towns are so much friendlier.  Everywhere we went people were saying hello and were eager to get into conversations.  We ended up talking with one hotel clerk for 15 to 20 minutes and he shared with us much of his life story.  He was a real “salt of the earth” type of guy and it was interesting to hear his unique perspective on life.  Every summer he makes jam and sells it in the hotel lobby and he encouraged us to stop by the next time we are in town to get some.

But he was not the only one that was extremely friendly.  People were eager to talk to us and were genuinely interested in what we were doing wherever we went.

Also, people sure seemed to smile a whole lot more in these small towns.  They just seemed happier.

This is so much different from what I have been used to.  Most of my life I have lived either in or near big cities.

When I worked as a lawyer in Washington D.C., I took the metro to work every morning.  Often the passengers were crammed into the metro cars like cattle, but most of the time there was absolutely no conversation among the passengers.  Usually it was just dead silence all the way into D.C.

In fact, if you did try to strike up a conversation with someone it usually created an awkward moment.

The truth is that in most big cities there is an unwritten rule that you really aren’t even supposed to make eye contact with people.  If someone tries to interact with you, it is usually because they want something from you.

So is living in a city with several million people really better than living in a town with only a few thousand people?

During our trip, my wife and I stopped in a little community store where they actually had cats for adoption scattered throughout the store.  We also ventured into a pizza parlor that could have been straight out of the 1970s or 1980s.  The floor of the pizzeria was a classic red and white checkerboard pattern and there was an old jukebox sitting in the corner.  It was great.

Today most of our big box stores are so “corporate” and so “sterile” that something gets lost.  When we eliminate the “human element” from everything the world becomes a colder place.

There are still places in America where people will take you at your word.

There are still places in America where people will invite you to stay with them even though they just met you.

There are still places in America where the air is clean, the people are authentically friendly and where the corporations don’t own all the businesses.

The other night my wife and I ordered some food at a “real” family restaurant and it was so much different from what we were used to.

Yes, the decor was a bit dated and the environment was not as “clinical” as you will find in most corporate-owned restaurants, but we had a great time.

I ordered some chicken, and when they brought it out it was not anything like the little bony pieces of chicken that they give you most places.  I had probably the thickest chicken breast that I have ever seen.  There was as much meat on that one chicken breast as there would be on five or six “tv dinner” chicken breasts.

So is small town life preferable?

Well, it is undeniable that living near a big city is much more convenient and most of the good jobs are in or near the big cities.

But as the economy collapses and as society becomes increasingly unstable, do you really want to find yourself in the middle of one of our urban areas?

This is a theme I have been talking about a lot recently.  The following are just a few of the articles that I have put out about the breakdown of society in recent weeks….

*”18 Signs The Collapse Of Society Is Accelerating”

*”12 More Signs That Society Is Collapsing”

*”Americans Gone Wild”

It would be nice if things would calm down for a while, but that is just not happening.

In fact, what have we seen just this week?

A horrifying riot in Vancouver.

Aren’t Canadians supposed to be calmer than us?

You can see video of the shocking riots in Vancouver right here, or you can just view the video below….

Yes, there is nothing new about sports riots.

However, what is new is the level of the violence.

15 vehicles, including two police cruisers, were set on fire.  Windows were smashed and stores were openly looted in front of television cameras.  Police were pelted with rocks and debris.  A huge section of the city of Vancouver turned into a war zone.

And for what?

A hockey game?

So what is going to happen someday when those people have real problems?

Part of preparing for hard times is evaluating where you live.

Do you really want to live smack dab in the middle of a major urban area if we do see major rioting in this country someday?

What happened in Vancouver this week was absolutely mindless.

But thankfully, while all of this was going on my wife and I were also reminded that there are still large numbers of really wonderful people out there too.

Small town America is alive and well.  Yes, huge numbers of families are really struggling in this economic environment, but that does not mean that they have given up.  They still believe in America and they still believe in each other.

Yes, an economic collapse is coming.  But that doesn’t mean that all Americans are going to respond to it the same way.  If you don’t have a lot of faith in the community where you currently live, you might want to take a closer look at some of the truly great small towns scattered throughout this country.

You might just be surprised at what you find.

The Sky Is Falling, It Is Time To Panic And The U.S. Economy Has Fallen And It Can’t Get Up

So many economists and financial pundits seem absolutely shocked that the U.S. economy is slowing down again.  It is as if this latest wave of bad economic data has caught them completely by surprise.  Now, in the mainstream media we are seeing all kinds of headlines declaring that the U.S. economy is headed for disaster.  But anyone with half a brain could have seen this coming.  This year alone, we have seen the worst tsunami in Japanese history, the worst U.S. tornado season in recent memory and the worst Mississippi River flooding in decades.  In addition, chaos in the Middle East has pushed the price of oil up to very high levels.  Of course all of those things were going to have an effect on the economy.  In addition, all of the long-term trends that have been destroying the U.S. economy for decades have not been taken a breather.  In fact, the truth is that all of our long-term economic problems have been accelerating.  So yes, the sky is falling, it is time to panic and the U.S. economy really has fallen and it really can’t get up.  It is just that everyone in the mainstream media seems to have believed that Ben Bernanke and Barack Obama would just sprinkle a bunch of fairy dust on the economy and everything would just magically get better.  Well, in the real world things simply do not work that way.

Despite an unprecedented debt binge by the federal government and nightmarish money printing by the Federal Reserve, the economic downturn continues to drag on.  Andrew Barber, a strategist at Waverly Advisors in Corning, New York recently told CNN the following….

“People are starting to see that this sort of malaise is not just going to go away no matter what you do.”

And “malaise” is a really good word for what we have been experiencing.  For those that remember the late 1970s, what we are going through today is similar in a lot of ways.

But what is perhaps even more frightening is that 2011 is starting to look a lot like 2008 all over again.

In particular, we are starting to see some real signs of instability in the financial markets.

When Moody’s downgraded Greek debt again on Wednesday all the way down to Caa1, I was only moderately alarmed.  The truth is that everyone knows Greece is a basket case so a debt downgrade wasn’t really all that surprising.

When Moody’s announced that it plans to review the U.S. government’s AAA debt rating “if there is no progress on increasing the statutory debt limit in coming weeks” that got the attention of a lot of people around the world, but it was not totally unexpected. Moody’s is telling Congress that they better raise the debt ceiling or else.  A lot more pressure will be applied to Congress before this is over.

When Moody’s warned that it may downgrade the debt ratings of Bank of America, Citigroup and Wells Fargo, that really set off alarm bells for me.

Do you all remember what set off the financial panic in 2008?

Do the names “Bear Stearns” and “Lehman Brothers” ring a bell?

Well, right now there are some frightening indications that we may see more trouble at some “too big to fail” institutions.

But will there be any willingness to do more bailouts this time?

Right now the financial markets are closely mirroring their performance just prior to the financial collapse of 2008.  One great example of this is these charts which were recently posted by the Financial Armageddon blog.  It looks like bank stocks may once again be leading the way down.

Hopefully the financial system can hold together and we won’t have a repeat of 2008 right now, because if it happens it is going to be really messy.

But even without a “financial collapse” we already have all of the economic problems that we can handle.

Robert Brusca, the chief economist at FAO Economics, is being quoted by CNN as saying the following….

“We’ve had a poor economic recovery to begin with, and now it appears to be segueing into an end.”

At this point, U.S. consumer confidence is already lower than it was back in September 2008 when Lehman Brothers collapsed.  U.S. consumers are holding on to their money more tightly these days and that is not a good sign for an economy that is so highly dependent on consumer spending.

The latest manufacturing numbers have also been very distressing.  Measures of manufacturing activity all over the world are indicating that we have now entered an economic slowdown.  This is also similar to what we saw a few years ago.

We should all feel really bad for anyone that is entering the workforce right now.  We are in the midst of graduation season, and the only thing that our new graduates have to look forward to is an economic crisis that never seems to end.

On a recent article entitled “Global Financial Markets Tremble As Bad Economic News Continues To Pour In” a reader named Esta left the following comment….

I feel sad for yet another year of graduates entering a horrible job market. I recently read, and I think it was in the mainstream media, that only half the 2010 college grads have found jobs of any kind, only half of those have found jobs requiring a college education, and that 85 percent of all grads moved right back in with their parents. The job growth rate is so low that we keep employing fewer and fewer people as a percentage of our adult population. Why isn’t that still a recession?

What a future our college graduates have to look forward to, eh?  Moving back in with your parents, a crappy job (if you can find one) and a pile of student loan debt that will crush you financially for decades.

We are always told that “more education” is the answer, but even many of our most highly educated young people can’t find jobs.  In fact, it turns out that a third of last year’s law school graduates aren’t even practicing law….

The law school class of 2010 is making news for all the wrong reasons. The budding legal minds who managed to find employment last year have set a new record–only 68.4 percent of them are in jobs that require them to pass the bar exam, the lowest share since the Association for Legal Professionals began collecting data.

Now it looks like the economy is going to starting heading downhill once again.

What is that going to do to the job market?

Last year, only 45.4% of Americans had jobs.  That was the lowest figure since 1983.

In some states it was even worse than that.  In states like California, Arizona and Mississippi only about 37 percent of people had a job last year.

The economic news just seems to get worse and worse and worse.  The American people have been relatively calm over the past several years as they have waited for the promised “economic recovery”, but what do you think is going to happen if we have another major economic downturn and unemployment spikes back up by several more percentage points?

And what in the world can our “leaders” really do to “help” the economy if we do have a repeat of 2008?

We are already running trillion dollar deficits.

The Federal Reserve is already printing money like it is going out of style.

So what would their next moves be?

Most Americans have no idea how fragile our financial system and our economy really are.

Let us hope and pray that things can hold together for as long as possible, because when the next wave of the economic collapse happens it is going to be really, really messy.

Global Financial Markets Tremble As Bad Economic News Continues To Pour In

As the U.S. economy starts to slow down once again, global financial markets are beginning to tremble.  Over the past couple of weeks, all kinds of bad economic news has been pouring in.  The ADP jobs report was a “disaster”, the housing numbers are dismal, manufacturing has slowed way down and consumer confidence is dropping like a rock.  The Democrats and the Republicans are bickering over the debt ceiling and this is causing a lot of uncertainty as well.  All of this bad news is starting to spook investors.  On Wednesday, the Dow was down 279 points and the NASDAQ was down 65 points. It was the worst day of the year for the Dow, and many are wondering what is going to happen next if we see even more bad economic data.  QE2 is slated to end at the end of the month, and already the bond markets seem to be anticipating QE3.  If the U.S. economy enters another significant downturn during the second half of 2011, it seems quite likely that the Federal Reserve would attempt to do something to stimulate the economy and that would probably mean more money printing.

This article is essentially the second part to an article I wrote yesterday about how we are seeing warnings about the next financial collapse all over the place right now.  Panic is building and a lot of investors are trying to figure out where to put their money.  Suddenly everyone seems a whole lot less optimistic than they were a couple of months ago.

Michael Sheldon, the chief market strategist at RDM Financial, believes that all of the bad economic news we are seeing right now is clear evidence that we are entering an “economic slump”….

“Initially, we just had bad news from the weekly jobless claims data, but now we’re starting to see a broad-based economic slump.”

So what are some of the numbers that have investors so concerned?

Mike Riddell, a fund manager at M&G Investments in London, recently explained to CNBC why he is so alarmed right now….

“US house prices have fallen by more than 5 percent year on year, pending home sales have collapsed and existing home sales disappointed, the trend of improving jobless claims has arrested, first quarter GDP wasn’t revised upwards by the 0.4 percent forecast, durables goods orders shrank, manufacturing surveys from Philadelphia Fed, Richmond Fed and Chicago Fed were all very disappointing.”

The bad economic news just keeps rolling in.  It is almost as if someone has slammed on the economic brakes.

The following are a few more examples of the bad economic numbers that have come out over the past couple of days….

*According to the latest ADP Employment Services report, private employers in the United States only added 38,000 jobs last month.  That number had been expected to be somewhere around 175,000.  This jobs report is being called a “disaster“.

*Manufacturing activity in May was much lower than most economists were projecting.  The following is how CNBC described the newest numbers from ISM….

The Institute for Supply Management (ISM) said its index of national factory activity fell to 53.5 in May from 60.4 the month before. The reading missed economists’ expectations for 57.7.

*Moody’s downgraded Greek debt again on Wednesday, and stated that they believe that there is a 50/50 chance that Greece will default.  This time Moody’s downgraded Greek debt by three levels all the way down to Caa1, and that caused the euro to fall like a rock.

To get an idea of just how imbalanced the European financial system has become at this point, just check out this article.

*Earlier this week it was announced that U.S. home prices have declined 5.1% from a year ago.  Sadly, U.S. home prices have now fallen more than they did during the entire Great Depression.

*As I mentioned yesterday, the consumer confidence index fell from 66 in April to 60.8 in May.

So what is causing all of this?

Well, the truth is that the “sugar high” that the U.S. economy has been enjoying is coming to an end.

QE2 is almost over and the vast majority of the federal “stimulus money” has been spent.  Now the federal government is talking about getting spending under control and we are seeing austerity programs being implemented on the state and local level from coast to coast.

But without massive intervention by the Federal Reserve and by the U.S. government will the U.S. economy be able to stand?

Douglas Borthwick, a managing director with Faros Trading in Stamford, Connecticut is not optimistic….

“The sugar high that has buoyed the U.S. economy over the past six months is wearing out, and there is little in economic growth or foundation to show for it.”

The truth is that the Fed and the U.S. government went all-out in an attempt to keep the economy from falling into a total depression.  The U.S. government has been running budget deficits well in excess of a trillion dollars and the Fed has been printing money like mad.  If these measures are removed, the economic crisis we are experiencing might just get a whole lot worse.

How much worse?

Well, just check out what Peter Yastrow, a market strategist for Yastrow Origer, recently told CNBC….

“Interest rates are amazingly low and that, thanks to Ben Bernanke, is driving everything,” Yastrow said. “We’re on the verge of a great, great depression. The [Federal Reserve] knows it.”

Ben Bernanke and Barack Obama keep talking about the “economic recovery” but most Americans know better.

According to one new poll, 66% of Americans believe that we are still in a recession.

Perhaps this is a sign that the American people are starting to wake up to the new economic realities that we are facing.

The U.S. economy is being ripped apart and shredded.  Thanks to our short-sighted trade policies, the Chinese economy has roared to life while the U.S. economy continues to ship jobs and factories overseas.

But instead of facing up to our economic problems and coming up with some solutions, our nation has been on a horrific debt binge over the last couple of decades in a desperate attempt to maintain our standard of living.

One of the reasons why I pound on the economic news day after day is so that more people will really understand what is going on and will start to wake up.

In fact, if you have a family member of a friend that just doesn’t get it, the following is a great article to share with that person: “50 Things Every American Should Know About The Collapse Of The Economy“.

Look, even Barack Obama says that the present state of affairs is “unsustainable” and that changes have to be made.

But if the U.S. government decided that it was going to go to a balanced budget tomorrow, that would suck approximately a trillion and a half dollars out of the economy.

What do you think would happen if that came to pass?

Of course by going into even more debt we are destroying the economic future of our children and our grandchildren.

We have piled up the biggest mountain of debt in the history of the world and we expect future generations to pay it off.

It is absolutely disgusting what we have done and it is thievery on the highest level.

Everyone knows that we are living in the greatest debt bubble in the history of the world and that at some point it is going to pop.

Perhaps the best we can hope for at this point is for a little bit more time before economic disaster strikes.

Unfortunately, all of the latest economic news seems to be pointing toward another economic slowdown.

Hold on to your seats.

Extreme Paranoia

Have you noticed that our entire society operates on fear now? Everyone is afraid of everybody else. We are taught not to trust anyone that we do not know and that we should literally spy on our neighbors because they might be a threat. If you do not participate in all of the extreme paranoia that is going on then supposedly something is wrong with you. In fact, if you are not paranoid like everyone else is then you might be a threat.  After all, according to FBI Director Robert Mueller, “homegrown terrorists” represent as big a threat to American national security as al-Qaeda does.  But in the midst of all of this extreme paranoia, we have thrown common sense out the window.  We are told that it is Islamic extremists that want to attack us, and yet we are so obsessed with being politically correct that the TSA will grope grandma, grandpa and all the little children they can get their hands on but they will allow men in full Islamic dress to walk right through airport security without even being checked.  We will put up video cameras to watch schoolchildren eat their lunches and yet we are leaving our borders completely wide open.  Thousands of real terrorists could be crossing our borders each day and we would never even know it.  But this is what happens when extreme paranoia sets in – people (and governments) start behaving very irrationally.

Recently, U.S. Representative Paul Broun went through airport security and what he witnessed absolutely shocked him….

“I walked through there was right behind me there was a grandmother — little old lady, and she was was patted down. Right behind her was a little kid who was patted down. And then right behind him was a guy in Arabian dress who just walked right through. Why are we patting down grandma and kids?”

What ever happened to common sense?

The American people are constantly whipped into a state of fear by the mainstream media and so there is a never ending call for even more “security” so that we can all feel safe.

Meanwhile, the most basic things that need to be done for our security, such as securing our borders, are totally ignored because they are not politically correct.

Instead, most of the focus seems to be on keeping as many eyeballs on American citizens of possible.

U.S. Senator Ron Wyden made headlines recently when he revealed that the U.S. government interprets the Patriot Act much more “broadly” than the general public does….

“We’re getting to a gap between what the public thinks the law says and what the American government secretly thinks the law says.”

That doesn’t sound good.

According to Wyden, “the government is relying on secret interpretations of what the law says without telling the public what those interpretations are.”

Isn’t that great?

Now the government has such extreme paranoia that they won’t even tell us what the rules are so we won’t even know if we are breaking them.

Have you noticed that everything seems to be “secret” these days?

Everywhere you turn someone in the government is claiming that “national security” is at risk for one reason or another.  The American people are being increasingly kept in the dark about everything because we cannot be “trusted”.

Secrecy and extreme security measures are now equated with patriotism.

Recently, U.S. Representative Ron Paul gave a speech on “The Patriot Act” on the floor of the House of Representatives.  The following is a brief except from that speech….

Our Presidents can now, on their own:

*Order assassinations, including American citizens,
*Operate secret military tribunals,
*Engage in torture,
*Enforce indefinite imprisonment without due process,
*Order searches and seizures without proper warrants, gutting the 4th Amendment,
*Ignore the 60 day rule for reporting to the Congress the nature of any military operations as required by the War Power Resolution,
*Continue the Patriot Act abuses without oversight,
*Wage war at will,
*Treat all Americans as suspected terrorists at airports with TSA groping and nude x-raying.

And the Federal Reserve accommodates by counterfeiting the funds needed and not paid for by taxation and borrowing, permitting runaway spending, endless debt, and special interest bail-outs.

Does that sound “patriotic” to you?

The following is a short video that includes even more of Ron Paul’s remarks….

Sadly, Ron Paul is vastly outnumbered in Congress by those that want even more secrecy and even more extreme security measures.

America is becoming a much different place.  The truth is that even if we give up all of our liberties and all of our freedoms we will still be extremely vulnerable to outside threats.

Do you really want to live in a society where there is very little liberty or freedom?  That is the direction America is going.  We may feel slightly safer, but we will cease to be Americans.

Recently, I wrote about the growing “big brother” control grid going up all over the country on The American Dream….

Do you want your children and grandchildren to live in a futuristic “big brother” control grid where everything they do is watched, recorded, tracked and tightly controlled?  Well, that is exactly where things are headed.  We witnessed some really bad totalitarian regimes during the 20th century, but what is coming is going to be far more restrictive than any of the despots of the past ever dreamed was possible.  Today, nearly every government on earth is tightening their grip on their citizens.  Paranoia has become standard operating procedure all over the planet and nobody is to be trusted.

All of this extreme paranoia must stop.

Sometimes people will say something like this: “Well, I don’t mind if the government watches me or searches me because I have nothing to hide.”

The next time someone tells you something like that, do the following….

Pull out a chair and set it down six inches away from that person.  Then sit in the chair and stare directly at him or her without moving.  After a few moments that person will say something like: “What in the hell are you doing?”

In response, just tell them that they just said that they didn’t mind being watched.

The truth is that none of us want eyeballs on us 24 hours a day.

Our founding fathers included the Bill of Rights in the Constitution for a reason.  The Bill of Rights is there to protect our most basic liberties.

If we allow those liberties to be stripped away in exchange for a little bit more security we will only have ourselves to blame.

+ More