Drowning In Debt

Bankrupt America: Bankruptcy Soars As The Country Grapples With An Unprecedented Debt Problem

America, you officially have a debt problem, and I am not just talking about the national debt.  Consumer bankruptcies are surging, corporate debt has doubled since the last financial crisis, state and local government debt loads have never been higher, and the federal government has been adding more than a trillion dollars a year to the federal debt ever since Barack Obama entered the White House.  We have been on the greatest debt binge in human history, and it has enabled us to enjoy our ridiculously high standard of living for far longer than we deserved.  Many of us have been sounding the alarm about our debt problem for a very long time, but now even the mainstream news is freaking out about it.  I have a feeling that they just want something else to hammer President Trump over the head with, but they are actually speaking the truth when they say that we are facing an unprecedented debt crisis.

For example, the New York Times just published a piece that discussed the fact that the bankruptcy rate among retirees is about three times higher than it was in 1991…

For a rapidly growing share of older Americans, traditional ideas about life in retirement are being upended by a dismal reality: bankruptcy.

The signs of potential trouble — vanishing pensions, soaring medical expenses, inadequate savings — have been building for years. Now, new research sheds light on the scope of the problem: The rate of people 65 and older filing for bankruptcy is three times what it was in 1991, the study found, and the same group accounts for a far greater share of all filers.

Overall, Baby Boomers are doing a whole lot better financially than the generations coming after them, and so this is very troubling news.

And here is another very troubling fact from that same article…

Not only are more older people seeking relief through bankruptcy, but they also represent a widening slice of all filers: 12.2 percent of filers are now 65 or older, up from 2.1 percent in 1991.

The jump is so pronounced, the study says, that the aging of the baby boom generation cannot explain it.

Of course it isn’t just Baby Boomers that are drowning in debt.

Collectively, U.S. households are 13.15 trillion dollars in debt, which is the highest level in American history.

All over the nation, companies are also going bankrupt at a staggering pace.  This week we learned that the biggest mattress retailer in the entire country “Is considering a potential bankruptcy filing”…

Mattress Firm Inc, the largest U.S. mattress retailer, is considering a potential bankruptcy filing as it seeks ways to get out of costly store leases and shut some of its 3,000 locations that are losing money, people familiar with the matter said.

Mattress Firm’s deliberations offer the latest example of a U.S. brick-and-mortar retailer struggling financially amid competition from e-commerce firms such as Amazon.com Inc (AMZN.O).

We have seen retailer after retailer go down, and it is being projected that this will be the worst year for retail store closings ever.

But it isn’t just retailers that are hurting.  Yesterday, I came across an article about a television manufacturer in South Carolina that just had to lay off “94 percent of their workforce”…

A TV manufacturer based in South Carolina have blamed Trump’s trade tariffs for laying off 94 percent of their workforce.

Element Electronics now has just eight employees in their company after letting 126 members of staff go.

They said the tariffs imposed on goods from China mean they can no longer buy essential components for their TVs.

During this next economic downturn, I believe that we are going to see the biggest wave of corporate bankruptcies that this country has ever seen.

State and local governments don’t go bankrupt, but they are drowning in debt as well.  State and local government debt has ballooned to the highest levels on record in recent years, and one of the big reasons for this is because we are facing a coming pension crisis that threatens to absolutely overwhelm us…

Many cities and states can no longer afford the unsustainable retirement promises made to millions of public workers over many years. By one estimate they are short $5 trillion, an amount that is roughly equal to the output of the world’s third-largest economy.

Certain pension funds face the prospect of insolvency unless governments increase taxes, divert funds or persuade workers to relinquish money they are owed. It is increasingly likely that retirees, as well as new workers, will be forced to take deeper benefit cuts.

Meanwhile, the federal government continues to engage in incredibly reckless financial behavior.  When Barack Obama was elected, we were 10 trillion dollars in debt, and now we are 21 trillion dollars in debt.

What that means is that we have been adding more than a trillion dollars to the national debt per year since 2008, and we continue to steal more than 100 million dollars every single hour of every single day from future generations of Americans.

And even though the Republicans have been in control in Washington, very few of our leaders seem to want to alter the trajectory that we are on.  But if something is not done, absolute disaster is a certainty.  At this point, it is being projected that our debt will reach 30 trillion dollars by 2028 if we stay on this current path.  It would be difficult to overstate the grave danger that we are facing, but nothing is being done to turn things around.  Here are some more projections from the Congressional Budget Office…

In 2022, the Highway Trust Fund will run out of full funding. In 2026, the Medicare Hospital Insurance Trust Fund follows. In 2032, the Social Security trust fund surpluses run dry, and all beneficiaries regardless of age or income level will face a 21 percent across-the-board benefit cut. Before 2030, we could have trillion-dollar annual interest payments. Interest rates have been low until now, but that is changing. As rates go up, we have to pay more on new debt and on all accumulated debt.

The amount we pay in interest on the debt is set to triple over the next ten years. But if interest rates rise just 1 point higher than expected, the government will owe an extra $1.9 trillion over 10 years.

On top of everything else, everyone else around the world has been on a massive debt binge as well.

Total global debt is well above 200 trillion dollars, and it has nearly quadrupled over the past 17 years.

Are you starting to understand why they call this a “debt bubble”?

Unfortunately, all debt bubbles must burst eventually, and the one that we are in right now is definitely on borrowed time.

Michael Snyder is a nationally syndicated writer, media personality and political activist. He is publisher of The Most Important News and the author of four books including The Beginning Of The End and Living A Life That Really Matters.

We Are About To See A Great, Big Debt-Fueled GDP Number For The 2nd Quarter, But There Is A Catch…

What kind of number for GDP growth in the 2nd quarter will we get on Friday? The market consensus is somewhere around 4 percent, but there are many out there that are expecting a number above 5 percent. The last time we witnessed such a number was during the third quarter of 2014 when the U.S. economy grew by 5.2 percent. If Friday’s GDP figure is better than that, it will be the best report that we have had since 2003. But let’s keep things in perspective. In seven of the last 10 years, GDP growth was much lower than anticipated in the first quarter and much higher than anticipated in the second quarter. It looks like that pattern may play out again in 2018, and analysts are already warning us to expect a much lower number for the third quarter.

And even though we have seen good quarters before, we still have not had a full year of 3 percent growth since the middle of the Bush administration.

Last year the U.S. economy grew by only 2.3 percent, which would be a horrible figure even if the government was using honest numbers. According to John Williams of shadowstats.com, GDP growth for 2017 would have actually been negative if honest numbers were being used.

So let’s not get too excited over one quarter. According to the official government numbers, the U.S. economy has not grown by at least 3 percent on an annual basis in 14 years. That is the longest stretch in all of U.S. history by a wide margin, and it is going to take a really good second half to break that string this year.

But that isn’t stopping people from hyping tomorrow’s number. According to White House economic adviser Larry Kudlow, we should see a number “in the 4 to 5 percent zone”…

“You’re going to get a GDP number on Friday that’s going to be a very impressive number. Some people are in the 4 to 5 percent zone,” Larry Kudlow, the White House economic adviser, told CBS This Morning.

And he is probably right.

In fact, we might see a number that is even better than that.

As CBS News has noted, the second quarter came after the new tax cuts were implemented but before the trade war started…

The second-quarter figure will be widely seen as a referendum on the GOP tax cuts of late 2017. This quarter benefits from a timing sweet spot, coming after the deficit-busting cuts trickled through the economy, but before the effects of the White House’s protectionist trade policies are fully felt.

If we get a really good number, it may actually be bad news for investors.

As Marketwatch has deftly observed, a high GDP growth number may affirm the Federal Reserve’s narrative that they need to keep raising rates in order to keep the economy from “overheating”…

Ultimately, a reading that comes in too hot could fuel expectations that the Federal Reserve may need to ramp up its pace of rate increases, with the possibility of a further two rate increases in September and December likely to tamp down too-hot growth. That could knock bond prices lower, conversely pushing rates up and pressuring equity markets lower as investors worry about rising borrowing costs.

Ultimately, most of the analysis that you are going to hear about this GDP number is a load of nonsense.

The only reason why the U.S. economy is showing a little bit of growth is because we are on the greatest debt binge in our history.

When Donald Trump entered the White House the U.S. government was 19.9 trillion dollars in debt, and now that figure has ballooned to 21.2 trillion dollars in debt.

If we had not added 1.3 trillion dollars to the national debt over the past year and a half, there is no way that the economy would be growing right now.

And to be honest, it wouldn’t be too difficult to ramp up GDP growth to 10 percent. All we would have to do would be to borrow and spend enough money.

So why don’t we do that?

Well, it is because we are already on a path to national suicide. It is being projected that our national debt will hit 30 trillion dollars by 2028, and neither the Republicans nor the Democrats seem concerned about doing anything to alter this trajectory.

If we do get to 30 trillion dollars in debt and interest rates return to their long-term averages, we will be paying more than 1.5 trillion dollars a year just in interest on the national debt and our nation will be financially destroyed.

Many of our largest states are absolutely drowning in debt as well. The following comes from Fox Business…

In Illinois, for instance, vendors wait months to be paid by a government that’s $30 billion in debt, and one whose bonds are just one notch above junk bond status, according to Daniels. New York’s more than $356 billion in debt; New Jersey more than $104 billion; and California more than $428 billion.

As I have explained so many times, we are living a debt-fueled standard of living that is way above what we deserve.

If we only spent what we had, the economy would immediately plunge into a depression and our standard of living would collapse. The only way to keep the party going is to borrow and spend increasingly larger amounts of money, but everyone knows that this is simply not sustainable.

And it isn’t just government debt that is the problem.

Since the last financial crisis, corporate debt has doubled.

A massive consumer debt binge has pushed credit card debt to an all-time record high, and at this point the average American household is nearly $140,000 in debt.

When you add all forms of debt together, Americans are nearly 70 trillion dollars in the hole right now. For much more on all of this, please see my previous article entitled “Why America Is Heading Straight Toward The Worst Debt Crisis In History”.

So enjoy the debt-fueled GDP numbers for now, because the truth is that they aren’t going to last for long.

Our endless appetite for debt is literally destroying the bright future that our children and our grandchildren were supposed to have, and someday they will look back and curse us for what we have done to their country.

Michael Snyder is a nationally syndicated writer, media personality and political activist. He is publisher of The Most Important News and the author of four books including The Beginning Of The End and Living A Life That Really Matters.

Why America Is Heading Straight Toward The Worst Debt Crisis In History

Today, America is nearly 70 trillion dollars in debt, and that debt is shooting higher at an exponential rate.  Usually most of the focus in on the national debt, which is now 21 trillion dollars and rising, but when you total all forms of debt in our society together it comes to a grand total just short of 70 trillion dollars.  Many people seem to believe that the debt imbalances that existed prior to the great financial crisis of 2008 have been solved, but that is not the case at all.  We are living in the terminal phase of the greatest debt bubble in history, and with each passing day that mountain of debt just keeps on getting bigger and bigger.  It simply is not mathematically possible for debt to keep on growing at a pace that is many times greater than GDP growth, and at some point this absurd bubble will come to an abrupt end.  So those that are forecasting many years of prosperity to come are simply being delusional.  Our current standard of living is very heavily fueled by debt, and at some point we are going to hit a wall.

Let’s talk about consumer debt first.  Excluding mortgage debt, consumer debt is projected to hit the 4 trillion dollar mark by the end of the year…

Americans are in a borrowing mood, and their total tab for consumer debt could reach a record $4 trillion by the end of 2018.

That’s according to LendingTree, a loan comparison website, which analyzed data from the Federal Reserve on nonmortgage debts including credit cards, and auto, personal and student loans.

Americans owe more than 26 percent of their annual income to this debt. That’s up from 22 percent in 2010. It’s also higher than debt levels during the mid-2000s when credit availability soared.

We have never seen this level of consumer debt before in all of U.S. history.  Just a few days ago I wrote about how tens of millions of Americans are living on the edge financially, and this is yet more evidence to back up that claim.

Right now, Americans owe more than a trillion dollars on auto loans, and we are clearly in the greatest auto loan debt bubble that we have ever seen.

Americans also owe more than a trillion dollars on their credit cards, and credit card delinquency rates are rising.  In fact, in some ways what we witnessed during the first quarter of 2018 was quite reminiscent of the peak of the last financial crisis…

In the first quarter, the delinquency rate on credit-card loan balances at commercial banks other than the largest 100 – so at the 4,788 smaller banks in the US – spiked in to 5.9%. This exceeds the peak during the Financial Crisis. The credit-card charge-off rate at these banks spiked to 8%. This is approaching the peak during the Financial Crisis.

The student loan debt bubble has also surpassed a trillion dollars, and the average young adult with student loan debt has a negative net worth…

Despite economic and stock market gains over the past nine years, many young adults are still struggling to get ahead in their financial lives and, in some ways, things may have actually gotten worse.

Americans age 25 to 34 with college degrees and student debt have a median net wealth of negative $1,900, according to a report analyzing 2016 Federal Reserve data released Thursday by Young Invincibles, a young adult advocacy group. That’s a drop of $9,000 from 2013, YI’s analysis found.

Meanwhile, corporate debt has doubled since the last financial crisis.  Thousands of companies are so highly leveraged that even a slight economic downturn could completely wipe them out.

State and local government debt levels are also at record highs, but nobody seems to care.  And if we never have another recession everything might work out okay.

The biggest offender of all, of course, is the United States federal government.  We have been adding about a trillion dollars a year to the national debt since Barack Obama first entered the White House, and Goldman Sachs is projecting that number will surpass 2 trillion dollars by 2028…

The fiscal outlook for the United States “is not good,” according to Goldman Sachs, and could pose a threat to the country’s economic security during the next recession.

According to forecasts from the bank’s chief economist, the federal deficit will increase from $825 billion (or 4.1 percent of gross domestic product) to $1.25 trillion (5.5 percent of GDP) by 2021. And by 2028, the bank expects the number to balloon to $2.05 trillion (7 percent of GDP).

Our national debt has been growing at an exponential rate for decades, and because total disaster has not struck yet many people seem to believe that we can keep on doing this.

But the truth is that it simply is not possible.  There is only so much debt that a society can take on before the entire system implodes.

So how close are we to that point?

The following chart comes from Charles Hugh Smith, and it shows the exponential rise in overall debt levels that has taken us to the brink of nearly 70 trillion dollars in debt…

And this next chart from the SRSrocco Report shows how our rate of overall debt growth has compared to our rate of GDP growth…

We are literally on a path to national suicide.

Whether it happens next month, next year or five years from now, it is inevitable that we are going to slam into a brick wall of financial reality.

For the moment, the only way that we can continue to enjoy our current debt-fueled standard of living is to continue increasing our debt bubble at an exponential rate.

But that can only go on for so long, and when the party ends we are going to experience the greatest debt crisis in history.

Today, the average American household is nearly $140,000 in debt, and that is more than double median household income.  And if we were to include each household’s share of corporate debt, local government debt, state government debt and federal government debt, that number would be many times higher.

All of this debt will never be repaid.  Ultimately there will come a day when the system will completely collapse under the weight of so much debt, and most Americans are completely unaware that such a day of reckoning is rapidly approaching.

Michael Snyder is a nationally syndicated writer, media personality and political activist.  He is the author of four books including The Beginning Of The End and Living A Life That Really Matters.

Imports From China Hit Record High As U.S. Trade Deficit Continues To Explode

It should upset you that virtually everything stocking the shelves of our major retailers seems to have been made somewhere else.  As a nation, we are consuming far more wealth than we are producing, and that is a recipe for national economic suicide.  This week we learned that imports from China hit an all-time record high in October, and that was one of the primary reasons why our trade deficit hit a staggering 48.7 billion dollars during that month.  Year after year we buy far more stuff from the rest of the world than they buy from us, and this is systematically impoverishing us.

Let me put this another way.  The amount of money that leaves our country each month is far greater than the amount of money that comes into it.  When you grasp this concept, it becomes easy to understand why major exporting nations such as China have become so wealthy, and why we are drowning in debt.

Sadly, most Americans don’t understand the trade deficit, and so they don’t understand how important news like this really is.  The following comes from Bloomberg…

The U.S. trade deficit widened in October to a nine-month high on record imports that reflect steady domestic demand, Commerce Department data showed Tuesday.

The surge in imports probably reflected merchants preparing for the holiday-shopping season. Consumer goods imports increased almost $800 million, including a $303 million gain in cell phones and other household goods, as well as more inbound shipments of furniture, appliances, toys and clothing.

Since China joined the WTO in 2001, the United States has lost more than 70,000 manufacturing facilities and millions of good paying manufacturing jobs.  Formerly great manufacturing cities such as Detroit now resemble war zones, but until Donald Trump came along nobody seemed to really care very much about what was happening.

Of course the Chinese are going to keep taking advantage of us for as long as they can.  They slap all sorts of tariffs and fees on our goods, and meanwhile we allow them to flood our shores with their products.  As a result, our trade deficit with China keeps hitting record high after record  high…

Record imports from China helped drive up the U.S. trade deficit 8.6 percent in October as retailers stocked up for the holidays, the Commerce Department reported Tuesday.

Goods and services coming into the U.S. from China, Mexico and the European Union all hit record levels, which boosted the trade gap to $48.7 billion from $44.9 billion in September. It’s the highest monthly trade deficit recorded since President Trump took office.

President Trump is precisely correct when he says that our trade agreements are not fair to American workers and American businesses.  We will always need to trade with the rest of the world, but we need to do so in a way that is fair for both sides.  As a member of Congress, I will fight tirelessly for American workers, and if you believe in what I am trying to do I hope that you will join the team.

We simply cannot stand by and do nothing.  Our trade deficits are absolutely killing our long-term economic future, and the only way that we have been able to maintain our standard of living is by going on the greatest debt binge in human history.

If we truly want to make America great again, we need to start making things in America again, and we need to start sending leaders to Washington that understand these issues.

Michael Snyder is a Republican candidate for Congress in Idaho’s First Congressional District, and you can learn how you can get involved in the campaign on his official website. His new book entitled “Living A Life That Really Matters” is available in paperback and for the Kindle on Amazon.com.

Goodbye American Dream: The Average U.S. Household Is $137,063 In Debt, And 38.4% Of Millennials Live With Their Parents

Once upon a time the United States had the largest and most vibrant middle class in the history of the world, but now the middle class is steadily being eroded.  The middle class became a minority of the population for the first time ever in 2015, and just recently I wrote about a new survey that showed that 78 percent of all full-time workers in the United States live paycheck to paycheck at least part of the time.  But most people still want to live the American Dream, and so they are going into tremendous amounts of debt in a desperate attempt to live that kind of a lifestyle.

According to the Federal Reserve, the average U.S. household is now $137,063 in debt, and that figure is more than double the median household income…

The average American household carries $137,063 in debt, according to the Federal Reserve’s latest numbers.

Yet the U.S. Census Bureau reports that the median household income was just $59,039 last year, suggesting that many Americans are living beyond their means.

As a nation, we are completely and utterly drowning in debt.  U.S. consumers are now nearly 13 trillion dollars in debt overall, and many will literally spend the rest of their lives making debt payments.

Over the past couple of decades, the cost of living has grown much faster than paychecks have, and this has put a tremendous amount of financial stress on hard working families.  We are told that we are in a “low inflation environment”, but that is simply not true at all…

Medical expenses have grown 57% since 2003, while food and housing costs climbed 36% and 32%, respectively. Those surging basic expenses could widen the inequality gap in America, as a quarter of Americans make less than $10 per hour.

Getting our healthcare costs under control is one of the biggest things that we need to do.  As I talked about the other day, some families have seen their health insurance premiums more than triple since Obamacare became law.

As the cost of living continues to rise, an increasing number of young people are discovering that the only way that they can make ends meet is to live with their parents.  As a result, the percentage of adults age 26 to age 34 that live at home continued to rise even after the last recession ended…

The share of older Millennials living with relatives is still rising, underscoring the lingering obstacles faced by Americans who entered the workforce during and after the Great Recession.

About 20% of adults age 26 to 34 are living with parents or other family members, a figure that has climbed steadily the past decade and is up from 17% in 2012, according to an analysis of Census Bureau data by Trulia, a real estate research firm.

A staggering 59.8 percent of younger Millennials (18 to 25) are now living with relatives, and overall an all-time record 38.4 percent of all Millennials are currently living with family.

If so many of our young people are unable to live the American Dream, what is the future of this nation going to look like?

Consumers are not the only ones that have been struggling to make ends meet.  Corporate debt has doubled since the last financial crisis, and it now stands at a record high of 8.7 trillion dollars…

Fueled by low interest rates and strong investor appetite, debt of nonfinancial companies has increased at a rapid clip, to $8.7 trillion, and is equal to more than 45 percent of GDP, according to David Ader, chief macro strategist at Informa Financial Intelligence.

According to the Federal Reserve, nonfinancial corporate debt outstanding has grown by $1 trillion in two years.

“Everything is fine until it isn’t,” Ader said. “We don’t need to worry about that until we’re in a slowdown and profit declines.”

And let us not forget government debt.  State and local governments all over the nation have piled up record amounts of debt, and the debt of the federal government has approximately doubled over the past decade.

But the fact that we are now 20 trillion dollars in debt as a nation does not tell the full story.  According to Boston University professor Larry Kotlikoff, the federal government is facing a fiscal gap of 210 trillion dollars over the next 75 years…

We have all these unofficial debts that are massive compared to the official debt. We’re focused just on the official debt, so we’re trying to balance the wrong books…

If you add up all the promises that have been made for spending obligations, including defense expenditures, and you subtract all the taxes that we expect to collect, the difference is $210 trillion. That’s the fiscal gap. That’s our true indebtedness.

We were the wealthiest and most prosperous nation in the history of the planet, but that was never good for us.

We always had to have more, and so we have been on the greatest debt binge in human history.

Now a day of reckoning is fast approaching, and those that believe that we can escape the consequences of our actions are being extremely delusional.

Michael Snyder is a Republican candidate for Congress in Idaho’s First Congressional District, and you can learn how you can get involved in the campaign on his official website. His new book entitled “Living A Life That Really Matters” is available in paperback and for the Kindle on Amazon.com.

How The Elite Dominate The World – Part 1: Debt As A Tool Of Enslavement

Throughout human history, those in the ruling class have found various ways to force those under them to work for their economic benefit.  But in our day and age, we are willingly enslaving ourselves.  The borrower is the servant of the lender, and there has never been more debt in our world than there is right now.  According to the Institute of International Finance, global debt has hit the 217 trillion dollar mark, although other estimates would put this number far higher.  Of course everyone knows that our planet is drowning in debt, but most people never stop to consider who owns all of this debt.  This unprecedented debt bubble represents that greatest transfer of wealth in human history, and those that are being enriched are the extremely wealthy elitists at the very, very top of the food chain.

Did you know that 8 men now have as much wealth as the poorest 3.6 billion people living on the planet combined?

Every year, the gap between the planet’s ultra-wealthy and the poor just becomes greater and greater.  This is something that I have written about frequently, and the “financialization” of the global economy is playing a major role in this trend.

The entire global financial system is based on debt, and this debt-based system endlessly funnels the wealth of the world to the very, very top of the pyramid.

It has been said that Albert Einstein once made the following statement…

“Compound interest is the eighth wonder of the world. He who understands it, earns it … he who doesn’t … pays it.”

Whether he actually made that statement or not, the reality of the matter is that it is quite true.  By getting all of the rest of us deep into debt, the elite can just sit back and slowly but surely become even wealthier over time.  Meanwhile, as the rest of us work endless hours to “pay our bills”, the truth is that we are spending our best years working to enrich someone else.

Much has been written about the men and women that control the world.  Whether you wish to call them “the elite”, “the establishment” or “the globalists”, the truth is that most of us understand who they are.  And how they control all of us is not some sort of giant conspiracy.  Ultimately, it is actually very simple.  Money is a form of social control, and by getting the rest of us into as much debt as possible they are able to get all of us to work for their economic benefit.

It starts at a very early age.  We greatly encourage our young people to go to college, and we tell them to not even worry about what it will cost.  We assure them that there will be great jobs available for them once they finish school and that they will have no problem paying off the student loans that they will accumulate.

Well, over the past 10 years student loan debt in the United States “has grown 250 percent” and is now sitting at an absolutely staggering grand total of 1.4 trillion dollars.  Millions of our young people are already entering the “real world” financially crippled, and many of them will literally spend decades paying off those debts.

But that is just the beginning.

In order to get around in our society, virtually all of us need at least one vehicle, and auto loans are very easy to get these days.  I remember when auto loans were only made for four or five years at the most, but in 2017 it is quite common to find loans on new vehicles that stretch out for six or seven years.

The total amount of auto loan debt in the United States has now surpassed a trillion dollars, and this very dangerous bubble just continues to grow.

If you want to own a home, that is going to mean even more debt.  In the old days, mortgages were commonly 10 years in length, but now 30 years is the standard.

By the way, do you know where the term “mortgage” originally comes from?

If you go all the way back to the Latin, it actually means “death pledge”.

And now that most mortgages are for 30 years, many will continue making payments until they literally drop dead.

Sadly, most Americans don’t even realize how much they are enriching those that are holding their mortgages.  For example, if you have a 30 year mortgage on a $300,000 home at 3.92 percent, you will end up making total payments of $510,640.

Credit card debt is even more insidious.  Interest rates on credit card debt are often in the high double digits, and some consumers actually end up paying back several times as much as they originally borrowed.

According to the Federal Reserve, total credit card debt in the United States has also now surpassed the trillion dollar mark, and we are about to enter the time of year when Americans use their credit cards the most frequently.

Overall, U.S. consumers are now nearly 13 trillion dollars in debt.

As borrowers, we are servants of the lenders, and most of us don’t even consciously understand what has been done to us.

In Part I, I have focused on individual debt obligations, but tomorrow in Part II I am going to talk about how the elite use government debt to corporately enslave us.  All over the planet, national governments are drowning in debt, and this didn’t happen by accident.  The elite love to get governments into debt because it is a way to systematically transfer tremendous amounts of wealth from our pockets to their pockets.  This year alone, the U.S. government will pay somewhere around half a trillion dollars just in interest on the national debt.  That represents a whole lot of tax dollars that we aren’t getting any benefit from, and those on the receiving end are just becoming wealthier and wealthier.

In Part II we will also talk about how our debt-based system is literally designed to create a government debt spiral.  Once you understand this, the way that you view potential solutions completely changes.  If we ever want to get government debt “under control”, we have got to do away with this current system that was intended to enslave us by those that created it.

We spend so much time on the symptoms, but if we ever want permanent solutions we need to start addressing the root causes of our problems.  Debt is a tool of enslavement, and the fact that humanity is now more than 200 trillion dollars in debt should deeply alarm all of us.

Michael Snyder is a Republican candidate for Congress in Idaho’s First Congressional District, and you can learn how you can get involved in the campaign on his official website. His new book entitled “Living A Life That Really Matters” is available in paperback and for the Kindle on Amazon.com.

March 2017: The End Of A 100 Year Global Debt Super Cycle Is Way Overdue

Global Debt Super Cycle - Public DomainFor more than 100 years global debt levels have been rising, and now we are potentially facing the greatest debt crisis in all of human history.  Never before have we seen such a level of debt saturation all over the planet, and pretty much everyone understands that this is going to end very, very badly at some point.  The only real question is when it will happen.  Many believe that the current global debt super cycle began when the Federal Reserve was established in 1913.  Central banks are designed to create debt, and since 1913 the U.S. national debt has gotten more than 6800 times larger.  But of course it is not just the United States that is in this sort of predicament.  At this point more than 99 percent of the population of the entire planet lives in a nation that has a debt-creating central bank, and as a result the whole world is drowning in debt.

When people tell me that things are going to “get better” in 2017 and beyond, I find it difficult not to roll my eyes.  The truth is that the only way we can even continue to maintain our current ridiculously high debt-fueled standard of living is to grow debt at a much faster pace than the economy is growing.  We may be able to do that for a brief period of time, but giant financial bubbles like this always end and we will not be any exception.

Barack Obama and his team understood what was happening, and they were able to keep us out of a horrifying economic depression by stealing more than nine trillion dollars from future generations of Americans and pumping that money into the U.S. economy.  As a result, the federal government is now 20 trillion dollars in debt, and that means that the eventual crash is going to be far, far worse than it would have been if we would have lived within our means all this time.

Corporations and households have been going into absolutely enormous amounts of debt as well.  Corporate debt has approximately doubled since the last financial crisis, and U.S. consumers are now more than 12 trillion dollars in debt.

When you add all forms of debt together, America’s debt to GDP ratio is now about 352 percent.  I think that the following illustration does a pretty good job of showing how absolutely insane that is…

If your brother earns $100,000 in annual income and borrowed $10,000 on his credit card, he could consume $110,000 worth of stuff.  In this example, his debt to his personal GDP is just 10%.  But what if he could get more credit year after year and reached a point where his total debt reached $352,000 but his income remained the same.  His personal debt-to-GDP ratio would now be 352%.

If he could borrow at super low interest rates, maybe he could sustain the monthly loan payments. Maybe?  But how much more could he possibly borrow?  What lender would lend him more?  And what if those low rates began to rise?  How much debt can his $100,000 income cover?  Essentially, he has reached the end of his own debt cycle.

The United States is certainly not alone in this regard.  When you look all over the industrialized world, you see similar triple digit debt to GDP figures.

When this current debt super cycle ultimately ends, it is going to create economic pain on a scale that will be unlike anything that we have ever seen before.  The following comes from King World News…

That is the inevitable consequence of 100 years of credit expansion from virtually nothing to $250 trillion, plus global unfunded liabilities of roughly $500 trillion, plus derivatives of $1.5 quadrillion. This is a staggering total of $2.25 quadrillion. Therefore, the question is not what could go wrong since it is guaranteed that all these liabilities will implode at some point. And when they do, it will bring misery to the world of a magnitude that no one could ever imagine. It is of course very difficult to forecast the end of a major cycle. As this is unlikely to be a mere 100-year cycle but possibly a 2000-year cycle. It is also impossible to forecast how long the decline will take. Will it be gradual like the Dark Ages, which took 500 years after the fall of the Roman Empire? Or will the fall be much faster this time due to the implosion of the biggest credit bubble in world history? The latter is more likely, especially since the bubble will become a lot bigger before it implodes.

And there are certainly lots of signs that a global slowdown is already beginning.  For example, global trade growth has fallen below 2 percent for only the third time since the year 2000.  On each of the other occasions, we witnessed a horrible recession take place.  For more signs that economic conditions are deteriorating, please see my previous article entitled “Recession 2017? Things Are Happening That Usually Never Happen Unless A New Recession Is Beginning“.

Of course much of the globe is already in the midst of a horrible economic crisis.  Brazil is in the middle of their worst recession ever, and people are literally starving in Venezuela.  A new round of debt problems has erupted in Europe, with Greece, Portugal and Italy being the latest flashpoints.

Just like in 2007, many are mocking the idea that the a major economic downturn is coming to the United States.  They believe that the ridiculously high stock market valuations of today can stick around indefinitely, and they are putting their faith in politicians.

But it won’t be too long before a new economic crisis begins in America and the kind of civil unrest that I portray in “The Beginning Of The End” erupts all across the country.

I just don’t understand why more people cannot see this.  Government debt, corporate debt and consumer debt have all been growing much, much faster than the overall economy.  Can someone please explain to me how that could possibly be sustainable in the long-term?

Someone that I considered to be a mentor but that has since passed away once said that things would seem like they would be getting better for a little while before the next crash comes.

And it turned out that he was precisely correct.  We are in a season of time when economic conditions have appeared to be getting a little bit better in the United States, and this has blinded so many people to the truth of what is about to happen to us.

Generation Snowflake: Percentage Of Young Adults Living With Their Parents Hasn’t Been This High Since 1940

snowflake-public-domainHave we failed this generation of young adults by not equipping them to be able to handle the harsh realities of the real world?  According to the Wall Street Journal, the percentage of Americans in the 18 to 34-year-old age bracket that are currently living with their parents hasn’t been this high in 75 years.  At this point nearly 40 percent of our young adults in that age range are living at home, and many are concerned that this could have some alarming implications for the future of our nation.

In the United States today, more than 60 million people live in multi-generational households, and it is a good thing to have a tight family.  But at some point young adults need to learn how to live their own independent lives, and in millions of cases this independence is being delayed or is never happening at all.

There are many factors involved in this trend.  First of all, there is truly a lack of good jobs despite what we are being told about an “economic recovery”.  Millions of young adults are graduating from college only to discover that there is a very limited number of good jobs available for our college graduates.  So some college graduates are able to secure the types of jobs that they were hoping for, but millions of others are not.

Normally when a recession ends, the percentage of young adults living with their parents starts to go back down.  But this has not happened this time around.  Instead, the percentage of young adults that live at home has just continued to rise…

The trend runs counter to that of previous economic cycles, when after a recession-related spike, the number of younger Americans living with relatives declined as the economy improved.

The result is that there is far less demand for housing than would be expected for the millennial generation, now the largest in U.S. history. The number of adults under age 30 has increased by 5 million over the last decade, but the number of households for that age group grew by just 200,000 over the same period, according to the Harvard Joint Center for Housing Studies.

Another major factor in all of this is the fact that Americans are getting married later in life than ever before and they are having fewer kids than previous generations.

In the old days, people got married young and they set up their own households even if they were dirt poor.  But these days we have hordes of single young adults that are perfectly content to sit at home and sponge off of Mommy and Daddy.

There seems to be a real lack of toughness to this generation of young adults, and many that have perceived this lack of toughness have resorted to referring to them as “Generation Snowflake”.  Over the past 12 months this term has become so common that the Guardian has dubbed it “the defining insult of 2016″…

Until very recently, to call someone a snowflake would have involved the word “generation”, too, as it was typically used to describe, or insult, a person in their late teens or early 20s. At the start of November, the Collins English Dictionary added “snowflake generation” to its words of the year list, where it sits alongside other vogue-ish new additions such as “Brexit” and “hygge”. The Collins definition is as follows: “The young adults of the 2010s, viewed as being less resilient and more prone to taking offence than previous generations”. Depending on what you read, being part of the “snowflake generation” may be as benign as taking selfies or talking about feelings too much, or it may infer a sense of entitlement, an untamed narcissism, or a form of identity politics that is resistant to free speech.

The phrase came to prominence in the UK at the beginning of 2016, after Claire Fox, director of the thinktank Institute of Ideas, used it in her book I Find That Offensive to address a generation of young people whom she calls “easily offended and thin-skinned”.

Of course there are exceptions.  I have some close friends that are young adults in this age range, and they are extraordinary people.

But overall, we seem to have dramatically failed this generation.  Maybe it is because we tend to baby our children from a very early age, and we want to protect them from danger so much that we never allow them to be exposed to the challenges that they need to face in order to toughen up and mature.

And it certainly doesn’t help that many of our young adults enter “the real world” already drowning in tens of thousands of dollars of debt.  According to CNN, about 70 percent of all college graduates in the U.S. will leave school with student loan debt, and the average loan balance for those college graduates is approximately $28,950.  Paying off student loan debt can be extremely painful, and it can be financially crippling for young people that are just trying to start their new lives.

When our high school kids are looking toward the future, we very much encourage them to go to the very best schools that they can possibly get into, and we tell them to not even worry about the cost.  We promise them that there will be plenty of good jobs once they graduate, and we push them into these loans without even warning them to consider the future implications.

According to a stunning article in the Wall Street Journal, many Baby Boomers are actually having money taken out of their Social Security checks because of unpaid student loans.  So when you go into student loan debt, it can literally haunt you for the rest of your life…

The government has collected about $1.1 billion from Social Security recipients of all ages to go toward unpaid student loans since 2001, including $171 million last year, the Government Accountability Office said Tuesday. Most affected recipients in fiscal year 2015—114,000—were age 50 or older and receiving disability benefits, with the typical borrower losing about $140 a month. About 38,000 were above age 64.

The report highlights the sharp growth in baby boomers entering retirement with student debt, most of it borrowed years ago to cover their own educations but some used to pay for their children’s schooling. Overall, about seven million Americans age 50 and older owed about $205 billion in federal student debt last year. About 1 in 3 were in default, raising the likelihood that garnishments will increase as more boomers retire.

What we are doing is clearly not working, but I am not particularly optimistic that this system will be fixed any time soon.

If you are a young person, you need to have a solid plan before pursuing an expensive college education.  Many young people just major in anything that they want without even considering if it will lead to a good career.  And instead of working hard to graduate in four years, many decide that they want to stretch the “college experience” out for five or six years so that they can party as much as possible before entering the real world.

The real world is a cold, cruel place, and if you start your new life drowning in debt that is just going to make things even more difficult for you.

On a personal note, I want to thank everyone that has supported the growth of The Most Important News.  It is a central news hub where you can find all of my articles, posts by incredible guest authors and many of the key news stories from all over the globe all gathered in one place.  Some technical issues have forced the site to be down for extended periods of time lately, but now it is being migrated to a much more powerful server.  I will not be updating it during the migration, but I should resume a normal posting schedule again very soon.

And I would like to thank all of my readers for making 2016 an absolutely amazing year.  I love you all, and I wish you all the very best as we head into what should prove to be a very “interesting” 2017.

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