Danger

The Global Commodity Crash Tells Us That A Major Deflationary Financial Crisis Is Imminent

December 10, 2015December 10, 2015 by Michael

If we really are plunging into a deflationary global financial crisis, we would expect to see commodity prices crash hard. That happened just before the great stock market crash of 2008, and that is precisely what is happening once again right now. On Thursday, the Bloomberg Commodity Index closed at 79.1544. The last time that it closed this low was 16 years ago. Not even during the worst moments of the last recession did it ever get so low. Overall, the Bloomberg Commodity Index is down more than 28 percent over the past 12 months, and it has plummeted by more than half since mid-2011. As a result of this stunning commodity collapse, extremely large mining companies such as Anglo American are imploding, giant commodity trading firms such as Glencore and Trafigura are in full-blown crisis mode, and huge portions of the global financial system are in danger of utterly collapsing.

In recent days, I have been trying to stress that many of the exact same patterns that we witnessed just prior to the great stock market crash of 2008 are happening once again. This includes the staggering crash of commodity prices that we are currently witnessing, and even CNN acknowledges that there are parallels to what we experienced seven years ago…

The last time raw materials like copper and oil were this cheap, an economic depression loomed just around the corner.

It’s no secret that commodities in general have had a horrendous 2015. A nasty combination of overflowing supply and soft demand has wreaked havoc on the industry.

But prices for everything from crude oil to industrial metals like aluminum, steel, copper, platinum, and palladium have collapsed even further in recent days.

As I mentioned above, this crash in prices is hitting mining companies really hard. Just this week, the fifth largest mining company in the entire world announced a massive restructuring and will be laying off tens of thousands of workers…

In the latest example of just how bad things have gotten, Anglo American–the world’s fifth largest miner–just kitchen sink-ed it, announcing a sweeping restructuring, a massive round of layoffs, and a dividend cut. The company will reduce its assets by some 60% while headcount will be cut by a whopping 85,000 or, nearly two-thirds.

Overall, the U.S. has lost approximately 123,000 good paying jobs from the mining sector since the end of 2014. And if commodity prices stay low, this sector is going to continue to bleed good paying jobs.

Meanwhile, investors have been dumping the debt of any companies that have anything to do with commodities. This has significantly contributed to the emerging junk bond crisis that I discussed in my last article. As I write this, a high yield bond ETF known as JNK has fallen all the way down to 34.31, which is the lowest that it has been since the last recession. For much more on the junk bond implosion, I would encourage you to read an article that Wolf Richter just put out entitled “Bond King Gets Antsy as Junk Bonds, Which Lead Stocks, Spiral to Heck“.

So why are commodity prices falling so rapidly?

Many analysts are pointing to the economic slowdown in China as the primary reason. For years, the Chinese economy voraciously gobbled up commodities from sources all over the planet, but now things are changing. The Chinese economy is really, really slowing down, and some recently released numbers give us some clues as to the true extent of that slowdown…

-Chinese exports fell 6.8 percent in November on a year over year basis after being down 6.9 percent on a year over year basis in October.

-Chinese imports were down 8.7 percent in November on a year over year basis.

-Chinese manufacturing activity has been contracting for nine months in a row.

-Last week, the China Containerized Freight Index plummeted to 718.58 – the lowest level ever recorded.

And of course it isn’t just China. Goldman Sachs says that the seventh largest economy on the entire planet, Brazil, has plunged into a “depression“. And as I pointed out the other day, of the 93 largest stock market indexes in the entire world, an astonishing 47 of them (more than half) are down at least 10 percent year to date.

Even though stocks slid in the U.S. this week, the major indexes still seem somewhat stable. But this is a bit of an illusion. Yes, the biggest names on Wall Street are still flying high for the moment, but shares of a multitude of smaller and mid-size firms have been plummeting. At this point, nearly 70 percent of all U.S. stocks are already below their 200 day moving averages. This is yet another thing that we would expect to see just before the bottom falls out for stocks.

Everything that I have been writing about this week (see here and here) is perfectly consistent with all of my warnings from earlier this year.

We are plunging into a deflationary financial crisis in textbook fashion. And if the Federal Reserve actually does decide to go ahead with an interest rate hike next week that is just going to make things even worse.

But most people are not patient enough to watch a process play out. Most people that write about “the coming economic collapse” hype it up like it is going to be some sort of big Hollywood blockbuster that is going to happen over a week or a month and then be over. That is definitely not the way that I see things.

To me, “the economic collapse” is something that has been happening for decades, that is still in the process of happening right now, and that will continue to happen as we move forward into the future. The long-term trends that are ripping our economy to shreds continue to intensify, and our leaders are not doing anything to fix our underlying fundamental problems.

And the financial crisis that I warned would start during 2015 and accelerate in 2016 has already begun. More than half of all major global stock market indexes are down by at least 10 percent year to date, and some of them have plummeted by more than 30 or 40 percent. Trillions of dollars of wealth has been wiped out around the globe, and this is just the beginning.

All of the numbers tell us the same thing.

Big trouble is ahead.

My job is to inform you of these things. What you choose to do with this information is up to you.

The Calm Before The Storm

October 26, 2015October 26, 2015 by Michael

Have you noticed that things have gotten eerily quiet in the month of October? After the chaos of late August and early September, many had anticipated that we would be dealing with a full-blown financial collapse by now, but instead we have entered a period of “dead calm” in which things have become exceedingly quiet in almost every way that you can possibly imagine. Other “watchmen” that I highly respect have made the exact same observation. Even though the economic numbers are screaming that we have entered a global recession, they aren’t really make any headline news. A whole host of major financial institutions around the planet are currently in danger of collapsing and creating the next “Lehman Brothers moment”, but none of them has imploded just yet. And of course Barack Obama seems bound and determined to start World War III. On Monday, it was announced that he is sending a guided missile destroyer into Chinese waters in the South China Sea. The Chinese have already stated that they might just start shooting if this happens, but Barack Obama doesn’t seem to care. But until the shooting actually begins, that is not likely to upset the current tranquility that we are enjoying either.

To me, what we are experiencing at the moment would best be described as “the calm before the storm”. If you are not familiar with this concept, this is how it is defined by How Stuff Works…

Have you ever spent an afternoon in the backyard, maybe grilling or enjoying a game of croquet, when suddenly you notice that everything goes quiet? The air seems still and calm — even the birds stop singing and quickly return to their nests.

After a few minutes, you feel a change in the air, and suddenly a line of clouds ominously appears on the horizon — clouds with a look that tells you they aren’t fooling around. You quickly dash in the house and narrowly miss the first fat raindrops that fall right before the downpour. At this moment, you might stop and ask yourself, “Why was it so calm and peaceful right before the storm hit?”

Like so many others, I believe that a great storm is coming, and yet right at this moment things seem so peaceful.

Unfortunately, this period of peace and quiet is not going to last for long, and most Americans know deep down that something is seriously wrong with our nation. In fact, a new WND/Clout poll has found that 85.3 percent of all likely voters in the United States believe that our country is going in the wrong direction…

The poll found 92.6 percent of those who identified themselves as conservative believe the nation is on the wrong track. Among those who call themselves liberal, 90.9 percent said it is going the wrong direction.

When asked what they think of the American economy after seven years of Obama’s leadership and economic policies, nearly 80 percent described it as “very fragile” or “somewhat fragile.”

Self-identified Democrats, Republicans, liberals and conservatives were in general agreement, with about 75 percent to 80 percent describing the economy as “somewhat fragile” or “very fragile.”

But even though we are steamrolling in the wrong direction, we haven’t suffered any incredibly serious consequences for it yet.

For the moment, this is allowing the mockers to have a field day. They are fully confident that Barack Obama and the Federal Reserve knew what they were doing after all, and they are gleefully taunting those of us that have been warning of the great disaster that is heading our way.

However, those that are wise are getting prepared.

I think that we could all learn some lessons from what Overstock.com Chairman Jonathan Johnson is doing. The following is an extended excerpt from a recent Zero Hedge article…

*****

One week ago Johnson, who is also candidate for Utah governor, spoke at the United Precious Metals Association, or UPMA, which we first profiled a month ago, and which takes advantage of Utah’s special status allowing the it to use gold as legal tender, offering gold and silver-backed accounts. As a reminder, the UPMA takes Federal Reserve Notes (or paper dollars) which it then translates into golden dollars (or silver). The golden dollars are based off the $50 one ounce gold coins produced by the Treasury of The United States. They are legal tender under the law and are protected as such.

What did Johnson tell the UPMA? Here are some choice quotes:

We are not big fans of Wall Street and we don’t trust them. We foresaw the financial crisis, we fought against the financial crisis that happened in 2008; we don’t trust the banks still and we foresee that with QE3, and QE4 and QE n that at some point there is going to be another significant financial crisis.

So what do we do as a business so that we would be prepared when that happens. One thing that we do that is fairly unique: we have about $10 million in gold, mostly the small button-sized coins, that we keep outside of the banking system. We expect that when there is a financial crisis there will be a banking holiday. I don’t know if it will be 2 days, or 2 weeks, or 2 months. We have $10 million in gold and silver in denominations small enough that we can use for payroll. We want to be able to keep our employees paid, safe and our site up and running during a financial crisis.

We also happen to have three months of food supply for every employee that we can live on.

*****

Why would such a seemingly intelligent and successful CEO of a large Internet company do such things?

It is because he can see the writing on the wall.

This period of calm will not last. A great storm is coming, and when it does arrive those that have not prepared for it are going to suffer tremendously.

Most people have no idea just how fragile our system really is. Today, some of these “too big to fail” banks supposedly have trillions of dollars in assets, but if you want to withdraw $10,000 or more in cash you have got to give them 24 hours notice to get enough money…

This is just the beginning. As anyone can tell you, it’s all but impossible to move large amounts of money into cash in the US. Even the large banks will routinely ask you for 24 hours notice if you need $10,000 or more in cash. These are banks will TRILLIONS of dollars worth of assets on their books.

And with each passing day we see even more signs of the global economic slowdown that is emerging all around us. For example, we just learned that the China Containerized Freight Index has dropped to the lowest level ever recorded. China accounts for more global trade than anyone else, and so this is a very clear sign that global economic activity is slowing down dramatically…

By early July, the index dropped below 800 for the first time in its history, which started in 1998 when the index was set at 1,000. It soon recovered to about 850. And just when bouts of hope were rising that the worst was over, it plunged again and hit even lower levels.

The latest weekly reading dropped another 1.7% from the prior week to 752.21, the worst level ever. The CCFI is now 30% below where it had been in February this year and 25% below where it had been 17 years ago at its inception.

But for those that don’t want to believe that hard times are on the way, they can take comfort in the eerie period of calm that we are experiencing right now.

What they don’t realize is that this truly is “the calm before the storm”, and the global economic crisis that is ahead of us is going to be far beyond what most people ever dared to imagine was possible.

The Sovereign Debt Bubble Will Continue To Expand Until – BANG – The System Implodes

January 20, 2013 by Michael

Why are so many politicians around the world declaring that the debt crisis is “over” when debt to GDP ratios all over the planet continue to skyrocket? The global economy has never seen anything like the sovereign debt bubble that we are experiencing today. The United States, Japan, and nearly every major nation in Europe are absolutely drowning in debt. We have heard a lot about “austerity” over in Europe in recent years, but debt to GDP ratios continue to rise in Greece, Spain, Italy, Ireland and Portugal. In general, most economists consider a debt to GDP ratio of 100% to be a “danger level”, and most of the economies of the western world have either already surpassed that level or are rapidly approaching it. Of course the biggest debt offender of all in many ways is the United States. The U.S. debt to GDP ratio has risen from 66.6 percent to 103 percent since 2007, and the U.S. government accumulated more new debt during Barack Obama’s first term than it did under the first 42 U.S. presidents combined. This insane sovereign debt bubble will continue to expand until a day of reckoning arrives and the system implodes. Nobody knows exactly when that moment will be reached, but without a doubt it is coming.

But if you listen to the mainstream media in the United States, you would be tempted to think that this giant bubble of debt is not much of a concern at all. For example, in a recent article in the Washington Post entitled “The case for deficit optimism“, Ezra Klein wrote the following…

“Here’s a secret: For all the sound and fury, Washington’s actually making real progress on debt.”

How many times have we heard that before?

About a decade ago, government officials were projecting that we would be swimming in gigantic government surpluses by now.

Instead, we are running trillion dollar deficits.

But right now there is a lot of optimism about the economy. The stock market recently hit a 5 year high and the business community is loving all of the false prosperity that all of this debt is buying us.

Even Warren Buffett does not really seem concerned about the exploding U.S. government debt. He recently made the following statement…

“It is not a good thing to have it going up in relation to GDP. That should be stabilized. But the debt itself is not a problem.”

Oh really?

A debt of 16 trillion dollars “is not a problem”?

Perhaps we should all run our finances that way.

Why don’t we all go out and open up 20 different credit cards, run them all up to the max, and then tell the credit card companies that we can’t pay them back but that it “is not a problem”.

Of course real life does not work that way.

The truth is that government debt is becoming a monstrous problem all over the globe. Just check out how debt to GDP ratios all over the planet have grown over the past five years…

United States

Debt to GDP ratio in 2007: 66.6 percent

Debt to GDP ratio in 2012: 103 percent

United Kingdom

Debt to GDP ratio in 2007: 43.4 percent

Debt to GDP ratio in 2012: 85.0 percent

France

Debt to GDP ratio in 2007: 63.7 percent

Debt to GDP ratio in 2012: 86 percent

Germany

Debt to GDP ratio in 2007: 67.6 percent

Debt to GDP ratio in 2012: 80.5 percent

Spain

Debt to GDP ratio in 2007: 39.6 percent

Debt to GDP ratio in 2012: 69.3 percent

Ireland

Debt to GDP ratio in 2007: 24.8 percent

Debt to GDP ratio in 2012: 106.4 percent

Portugal

Debt to GDP ratio in 2007: 63.9 percent

Debt to GDP ratio in 2012: 108.1 percent

Italy

Debt to GDP ratio in 2007: 106.6 percent

Debt to GDP ratio in 2012: 120.7 percent

Greece

Debt to GDP ratio in 2007: 106.1 percent

Debt to GDP ratio in 2012: 170.6 percent

The Eurozone As A Whole

Debt to GDP ratio in 2007: 68.4 percent

Debt to GDP ratio in 2012: 87.3 percent

Japan

Debt to GDP ratio in 2007: 172.1 percent

Debt to GDP ratio in 2012: 211.7 percent

So how does all of this end?

Well, it is going to be messy, but it is very difficult to say exactly when the system will collapse under the weight of too much debt. Some nations, such as Japan, are able to handle very high debt loads because they have a very high level of domestic saving. Up to this point, an astounding 95 percent of all Japanese government bonds have been purchased domestically. But other nations collapse under the weight of government debt even before they reach a debt to GDP ratio of 100%. The following is an excerpt from a recent Congressional Research Service report…

It is hard to predict at what point bond holders would deem it to be unsustainable. A few other advanced economies have debt-to-GDP ratios higher than that of the United States. Some of those countries in Europe have recently seen their financing costs rise to the point that they are unable to finance their deficits solely through private markets. But Japan has the highest debt-to-GDP ratio of any advanced economy, and it has continued to be able to finance its debt at extremely low costs.

When a government runs up massive amounts of debt, it is playing with fire. You can pile up mountains of government debt for a while, but eventually it catches up with you.

Over the past 10 years, the U.S. national debt has grown by an average of 9.3 percent per year, but the overall U.S. economy has only grown by an average of just 1.8 percent per year. That is unsustainable by definition.

There is going to be a tremendous price to pay for the debt binge that the U.S. government has indulged in over the past decade. During Barack Obama’s first term, the amount of new debt accumulated by the federal government breaks down to about $50,521 for every single household in the United States. That is utter insanity.

If you can believe it, we have accumulated more new government debt under Obama than we did from the inauguration of George Washington to the end of the Clinton administration.

And most Americans realize that something is seriously wrong. One recent poll found that only 34 percent of all Americans believe that the country is heading in the right direction, and 60 percent of all Americans believe that the country is heading in the wrong direction.

If we keep piling up so much debt, at some point a moment of great crisis will arrive. When that moment arrives, we could see havoc throughout the entire global financial system. For instance, most people don’t really understand the key role that U.S. Treasuries play in the derivatives market. The following is from a recent article posted on Zero Hedge…

This time around, things will be far worse if nothing is solved. If the US loses another AAA rating, then the financial markets could face systemic risk. The reason for this is that US Treasuries are one of the senior most forms of collateral used by the banks to backstop the $600+ trillion derivatives market.

As any trader who trades on margin can tell you, when the value of your collateral is called into question, those on the other side of the trade come looking for you to put up more capital on your trades. This can result in assets being sold en masse (similar to what happened after Lehman failed) and things can get very ugly very fast.

For much more on the danger that derivatives pose to our financial system, please see this article: “The Coming Derivatives Panic That Will Destroy Global Financial Markets“.

Once again, nobody knows exactly when the sovereign debt bubble will burst, but if we continue down the path that we are currently on, it will inevitably happen at some point.

And according to Professor Carmen Reinhart, when this bubble does burst things could unravel very rapidly…

“These processes are not linear,” warns Prof. Reinhart. “You can increase debt for a while and nothing happens. Then you hit the wall, and—bang!—what seem to be minor shocks that the markets would shrug off in other circumstances suddenly become big.”

At some point the global financial system will hit the wall that Professor Reinhart has warned about.

Are you ready?

8 Economic Threats That We Were Not Even Talking About At The Beginning Of The Summer

August 22, 2012 by Michael

In the crazy times in which we live, it helps to expect the unexpected. Sometimes you can think that you have it all figured out and then this world can throw a real curveball at you. Very few people anticipated that we would see a massive outbreak of the West Nile Virus in Texas this year or that the Mississippi River would be in danger of drying up after experiencing historic flooding last year. Who would have thought that we would see the worst drought in more than 50 years or that horrific wildfires would burn nearly 7 million acres of land? This is why economic conditions are always so hard to predict. A single “black swan event” can come along and change everything almost overnight. Our world has become incredibly unstable, and so who really knows what the rest of 2012 will bring? Will we see a stock market crash? Will the hurricane season be unusually bad? Will war erupt in the Middle East? Will we see a major earthquake on the west coast or even a volcanic eruption? Will the upcoming election cause an eruption of anger and frustration in America? We don’t know the answers to those questions yet, and the truth is that we will probably see some things happen that very few of us are anticipating at this point.

This is an exciting time to be a “news junkie”, but unfortunately the vast majority of the news these days is bad.

It is almost as if a “perfect storm” is developing. Our weather is going crazy, our financial system is on the verge of collapse, our politicians seem more insane than ever, there is evidence of social decay all around us and the drumbeats of war in the Middle East grow louder with each passing day.

As strange as 2012 has been so far, I fear that things are about to get a whole lot stranger.

Not that we haven’t had some very unanticipated events happen this year up to this point.

The following are 8 economic threats that we were not even talking about at the beginning of the summer….

#1 West Nile Virus

What is up with all of the strange disease outbreaks that we have seen so far this year?

Flesh eating disease and the bird flu have both been making global headlines this summer, but in the U.S. right now it is the West Nile Virus that is getting the most attention.

So far more than 1,100 cases of the West Nile Virus have been diagnosed in the United States and more than 41 people have died from it.

More than half of the cases so far have been in Texas, but we have also seen people come down with West Nile Virus in Mississippi, Louisiana, South Dakota, and Oklahoma.

If you live in any of those areas, you might want to do your best to avoid mosquitos for the rest of the summer.

#2 Historic Drought

This summer, the United States has experienced the worst drought that it has seen in more than 50 years.

This weather has been absolutely crippling for farmers and ranchers all over the nation. As I wrote about the other day, about half of all corn being grown in the U.S. is currently either in “poor” or “very poor” condition.

As the drought has dragged on, many farmers and ranchers have become increasingly desperate. In fact, one farmer has even been feeding his cows candy in an attempt to deal with rising feed prices.

Needless to say, this drought has been causing commodity prices to soar.

On Tuesday, the price of corn closed at a record $8.38 a bushel, and the price of soybeans closed at $17.30 a bushel.

#3 The Mississippi River Is Drying Up

Thanks to this drought, rivers and lakes all over the United States are drying up. In fact, there have been reports that millions of fish have been dying because water levels have gotten so low in many areas.

Even the mighty Mississippi River has dropped to dangerously low levels.

At this point, the Mississippi is lower than most people living along the river can ever remember. If it drops much lower, it could potentially have an absolutely devastating impact on the U.S. economy.

A recent NBC News report described what is at stake….

About $180 billion worth of goods move up and down the river on barges, 500 million tons of the basic ingredients for much of the U.S. economy, according to the American Waterways Operators, a trade group. It carries 60 percent of the nation’s grain, 22 percent of the oil and gas and 20 percent of the coal, according to American Waterways Operators. It would take 60 trailer trucks to carry the cargo in just one barge, 144 18-wheeler tankers to carry the oil and gas in one petroleum barge.

If all traffic along the Mississippi was forced to stop, it is estimated that it would cost the U.S. economy about 300 million dollars a day.

And already there have been stoppages along one 11 mile stretch of the river….

Nearly 100 boats and barges were waiting for passage Monday along an 11-mile stretch of the Mississippi River that has been closed because of low water levels, the U.S. Coast Guard said. New Orleans-based Coast Guard spokesman Ryan Tippets said the stretch of river near Greenville, Miss., has been closed intermittently since Aug. 11, when a vessel ran aground.

So what happens if the Mississippi gets even lower?

#4 Wildfires

The extreme heat has also been responsible for the horrific outbreak of wildfires that we have seen in the western United States this year.

So far in 2012, nearly 7 million acres have been burned up.

That is an area about as big as the states of Maryland and Delaware combined.

#5 The Global Elite Hoarding Gold

In the past, the global elite and the mainstream media would mock those who are hoarding gold in anticipation of a major financial collapse.

But now it is the global elite who are hoarding gold.

In a previous article, I discussed how men such as George Soros and John Paulson are investing mind-boggling amounts of money in gold right now. The amount of money that these two individuals are investing in gold is difficult to comprehend….

There was also news last week in an SEC filing that both George Soros and John Paulson had increased their investment in SPDR Gold Trust, the world’s largest publicly traded physical gold exchange traded fund (ETF).

Mr Soros upped his stake in the ETF to 884,400 shares from 319,550 and Mr Paulson bought 4.53m shares, bringing his stake to 21.3m.

At the current price of about $156 a share, these are new investments of about $88m of Mr Soros’ cash and more than $700m from Mr Paulson’s funds. These are significant positions.

Combined, Soros and Paulson dumped more than three quarters of a billion dollars into gold during the second quarter of 2012 alone.

So what are they anticipating?

The central banks of the world have been very busy hoarding gold as well. According to the World Gold Council, global central banks were net buyers of 157.5 metric tons of gold during the second quarter of 2012.

Over the past 20 years there has never been a time when global central banks have accumulated that much gold during a single quarter.

So just what in the world is going on?

#6 Recession In The UK

Everyone knew that Greece was in deep trouble.

And everyone knew that Italy and Spain were in deep trouble.

But it was a surprise to see the UK economy plunge deep into recession. During the second quarter of 2012 alone, the UK economy shrunk by 0.7 percent.

At this point the British economy has contracted for three quarters in a row.

Hopefully things will not get even worse over there.

#7 Major Economic Slowdown In The United States

Considering the fact that the U.S. economy never even came close to recovering from the last recession, it is a bit disheartening to see that it looks like we are headed for another major downturn.

According to Michael Panzer of Financial Armageddon, measurements of economic activity compiled by the Federal Reserve Bank of Philadelphia indicate that the U.S. economy is rapidly heading into another recession. If you doubt this, just check out this chart.

And for a lot more reasons why the U.S. economy is entering another recession, check out this article.

#8 Hauled Off To A Mental Institution For What You Believe

Do you ever worry that what you post on Facebook could get you involuntarily committed to a mental institution?

Well, that is exactly what happened to one military vet recently.

A former Marine named Brandon Raub was hauled off to a mental institution because of what he posted on his Facebook page.

This is how the Economic Policy Journal summarized what happened to Raub….

The muscle used to grab Brandon Raub was local Chesterfield County, VA police. Also present during the grab were agents of the FBI and of the Secret Service.

Both the FBI and the Secret Service claim that they were only observing and not participating in the grab. The Chesterfield County police initially stated that they were only carrying out a request from the federal agencies.

The police also claim Raub is not under arrest, even though he was led away in handcuffs and is not permitted to leave the psychiatric ward of a hospital—even though it appears that Raub is not in any way in need of psychological care.

I note this happened in the United States of America, with local police, FBI agents and Secret Service taking part.

The claim that Raub is “not under arrest” is completely and totally ridiculous. The authorities came to his door, slapped handcuffs on him and are holding him in a mental institution against his will.

And now he has been transferred to a facility that is 3 hours away from his family, his supporters and his legal team.

What in the world is America turning into?

The Rutherford Institute is defending Raub, and the following is an excerpt from a statement about this case on their website….

“This is not how justice in America is supposed to work—with Americans being arrested for doing nothing more than exercising their First Amendment rights, forced to undergo psychological evaluations, detained against their will and isolated from their family, friends and attorneys. This is a scary new chapter in our history,” said John W. Whitehead, president of The Rutherford Institute. “Brandon Raub is no different from the majority of Americans who use their private Facebook pages to post a variety of content, ranging from song lyrics and political hyperbole to trash talking their neighbors, friends and government leaders.”

This is the kind of thing that we have seen under brutal totalitarian regimes in the past. Dissidents are grabbed by authorities and taken to mental institutions where they are conveniently “disappeared”.

This kind of thing is not supposed to happen in America.

But it is happening.

And you know what? Before the authorities start attacking people for exercising free speech on Facebook perhaps they should clean up their own house.

It turns out that thousands of DHS employees have been convicted of crimes in recent years. The following is from a recent CNS News article….

There have been 2,527 Department of Homeland Security (DHS) employees and co-conspirators convicted of corruption and other criminal misconduct since 2004, according to a federal auditor.

Our world is becoming a very crazy place.

One thing that most people did see coming this summer was the continuing economic decline in Greece.

At this point Greece is experiencing a full-blown economic depression and it gets worse by the day.

If you can believe it, 1,250 companies have shut down in the second largest city in Greece in 2012 alone.

Ouch.

And many in the financial world believe the the situation in Greece is going to go beyond the breaking point fairly soon.

In fact, analysts at Citibank believe that there is a 90 percent chance that Greece will leave the euro over the next 12 to 18 months.

90 percent?

They sound pretty sure of themselves.

Not that the rest of Europe is in such great shape either.

According to Bloomberg, it looks like Europe will soon be losing about half a million auto industry jobs….

Efforts by PSA Peugeot Citroen (UG) and Fiat SpA (F) to end losses in Europe could cost more than 500,000 people their jobs as automakers and parts suppliers grapple with the effects of the European sovereign debt crisis.

We live in very unusual times.

Things are falling apart all around us and we seem to be rapidly approaching another major economic crisis.

Central banks, governments and Wall Street insiders all seem to be preparing for the worst.

Are you?