Economy

The economic implosion of 2020: Job losses ramp up again as millions of Americans continue to slide into poverty

October 15, 2020October 15, 2020 by Michael

The mainstream media keeps trying to convince us that things are about to get a whole lot better for the U.S. economy, but instead they just keep getting worse. On Thursday, we learned that another 898,000 Americans filed new claims for unemployment benefits last week. That was the highest number that we have seen since August, and it is yet more evidence that a new wave of layoffs has begun. But according to the experts that the mainstream media relies upon, this wasn’t supposed to happen. According to them, the number of Americans filing for unemployment benefits was supposed to be steadily tapering off as the U.S. economy shifted into recovery mode. Unfortunately for all of us, those experts have been dead wrong.

Yesterday, I wrote about the decline of the middle class in our country, and here in 2020 this pandemic has greatly accelerated that process.

In fact, one new study has found that almost 8 million more Americans have plunged into poverty just since May…

Nearly 8 million Americans have slid into poverty since May, according to a Columbia University study reported by the New York Times.

Why it matters:The researchers found that the monthly poverty rate for September was higher than rates during April or May, and it also topped pre-crisis levels, “[d]ue to the expiration of the CARES Act’s stimulus checks and $600 per week supplement to unemployment benefits.”

And another study discovered that 6 million more Americans fell into poverty in just the last three months…

A separate study by researchers at Notre Dame and the University of Chicago, found that 6 million people have slipped into poverty in the last three months, per the Times.

Our hearts should be breaking because of what is going on all over the country right now.

Millions upon millions of hard working people have lost their jobs and can’t find new ones. As a result, they have lost the comfortable middle class lifestyles that they once enjoyed and have now joined the ranks of the poor.

But the official government numbers don’t look that bad because millions of those people are not even categorized as “unemployed”. Instead, many of the workers that have lost their jobs during this pandemic have been thrown into a category that is called “not in the labor force”.

In order to have faith in the official government numbers, you have got to believe that more than 100 million working age Americans are “not in the labor force” because they don’t want to work.

It is such a sham. Why don’t we just put every single American that is not working into the “not in the labor force” category so that we can have 0.0 percent unemployment?

Wouldn’t that be wonderful?

Of course the truth is that more Americans are being laid off with each passing day. Over the past few weeks, some of the most iconic companies in the entire nation have been letting workers go…

Further, companies have begun initiating layoffs on a trajectory similar to traditional recessions, economists said, as slowdowns in consumer demand (rather than state-mandated shutdowns) lead them to cut jobs or close for good.

Companies such as Allstate, American Airlines, Disney, Royal Dutch Shell and United Airlines have each announced plans to cut thousands of workers in recent weeks.

Some parts of the country have been hit much harder than others by this economic downturn.

For instance, tourism has dried up almost completely in Las Vegas, and this week there have been more layoff announcements…

The Tropicana Las Vegas has given notice to 828 employees that they are being laid off beginning Thursday, Oct. 15.

And layoffs at two Paris Las Vegas restaurants are coming soon as notices have been filed with the state. Mon Ami Gabi intends to lay off 96 employees, and the Eiffel Tower Restaurant will lay off 53 employees. Both moves are scheduled to happen on Dec. 16, and the layoffs will be permanent.

In the end, most of the jobs that have been lost in Las Vegas will never come back until the tourists return, and that is simply not going to be happening for the foreseeable future.

Next door, the state of California has been absolutely devastated by this crisis as well.

If you can believe it, one out of every four Californians received unemployment benefits between March and July. The state may have more billionaires than anywhere else in the country, but according to the U.S. Census Bureau it also has the highest poverty rate…

Home to 166 billionaires, who made over $235 billion since the beginning of the pandemic, the Golden State also has the highest poverty rate: 17.2% when adjusted for the cost of living, according to a recent Census Bureau analysis.

That means that almost one out of every five people in the entire state of California is living in poverty right now.

If this is what a “recovery” looks like, I would hate to see what the “bad times” are going to look like.

And without a doubt, economic conditions are definitely going to get worse than they are now.

So many families in California are just barely scraping by from month to month, and more of them are falling into poverty every day. In fact, even USA Today is admitting that “California’s middle class isn’t done shrinking”…

To many, the streets of the Bay Area are renowned for the enduring homelessness crisis as much as for the renowned tech giants of Silicon Valley. In-between, California’s middle class isn’t done shrinking; teachers, artists, waiters and gig workers are awaiting their fate, often one government program away from having to take a minimum-wage job — or lose their homes.

It is kind of ironic. Many of those that live in California like to lecture the rest of us about “wealthy inequality”, but it is worse in their state than anywhere else.

Those at the very, very top of the pyramid are thriving (for now), but meanwhile countless others are falling out of the middle class.

It is like a really perverse game of musical chairs. Every time the music stops, more people lose their seats and the middle class shrinks some more.

Sadly, I think that this process is going to accelerate even more in 2021, and that is really bad news for millions upon millions of middle class American families that are deeply struggling right now.

***Michael’s new book entitled “Lost Prophecies Of The Future Of America” is now available in paperback and for the Kindle on Amazon.***

About the Author: My name is Michael Snyder and my brand new book entitled “Lost Prophecies Of The Future Of America” is now available on Amazon.com. In addition to my new book, I have written four others that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing the books you help to support the work that my wife and I are doing, and by giving it to others you help to multiply the impact that we are having on people all over the globe. I have published thousands of articles on The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I always freely and happily allow others to republish my articles on their own websites, but I also ask that they include this “About the Author” section with each article. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help. During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with as many people as we possibly can.

Goodbye Middle Class: Half Of All American Workers Made Less Than $34,248.45 Last Year

October 14, 2020 by Michael

If you are making less than $3,000 a month, you have plenty of company, because about half of the country is in the exact same boat. The Social Security Administration just released new wage statistics for 2019, and they are pretty startling. To me, the most alarming thing in the entire report is the fact that the median yearly wage was just $34,248.45 last year. In other words, half of all American workers made less than $34,248.45 in 2019, and half of all American workers made more than $34,248.45. That isn’t a whole lot of money. In fact, when you divide $34,248.45 by 12 you get just $2,854.05. Needless to say, it is not easy to survive in America today on just $2,854.05 a month, and this may help to explain why we have been seeing so many people fall out of the middle class in recent years.

And of course all of the figures that I am sharing with you in this article are just for 2019. This year, we have seen more than 63 million Americans file new claims for unemployment benefits as the U.S. economy has imploded during this pandemic, and so the final wage numbers for 2020 could be quite a bit worse than the numbers for 2019 were. Please keep that in mind as you go through the rest of this article.

Once upon a time in America, a single income could easily support a middle class household in most cases, but those days are long gone.

The cost of living has been rising far faster than our paychecks have, and as a result many Americans have been working themselves to the bone just to survive financially from month to month.

To give you an idea of just how bad things have gotten, I would like to share with you some key numbers from the report that the Social Security Administration just released…

-32.26 percent of American workers made less than $20,000 last year.

-44.79 percent of American workers made less than $30,000 last year.

-56.46 percent of American workers made less than $40,000 last year.

-65.91 percent of American workers made less than $50,000 last year.

Today, the poverty level for a household of five in the United States is $30,680.

That means that close to half of all workers in this country do not even make enough to get a family of five above the poverty level.

Wow.

There are tens of millions of Americans that are referred to as “the working poor” because they are living in poverty even though they are employed and are working extremely hard. Many of you that are reading this article know exactly what I am talking about. Some of you are working way more than 40 hours a week, and yet there never seems to be enough money at the end of the month.

Sadly, the truth is that our system has evolved in a manner that makes it almost impossible for most Americans to ever build up much wealth.

If you are making the median monthly wage of just $2,854.05, there simply is not going to be much left over after all of the bills are paid. First of all, you are going to need some place to live. In the middle of the country you may be able to find something habitable for under $1,000 a month, but in most of our major metropolitan areas that simply is not going to be realistic.

Secondly, you are going to need to pay your utility bills. If you can keep the combined cost of your power, water, phone, television and Internet bills to about $250 a month, you are doing quite well.

Thirdly, you will need a vehicle in order to get around, and these days it is hard to buy or lease a vehicle for less than $300 a month. In addition, you will also need insurance, and that will set you back even more.

Fourthly, you will need health insurance. If you are young and single, maybe you can find a plan for just a few hundred dollars a month, but most Americans pay far more.

Fifthly, you will probably want to eat, and that will cost you several hundred dollars a month as well.

At this point almost all of your money is already gone, and there are so many expenses that I haven’t even mentioned yet.

And of course you never even started with $2,854.05 in the first place, because all sorts of taxes were taken out of your paycheck before you even got it.

Are you starting to understand why so many families in America are deeply, deeply struggling today?

We have an economy that works for those at the very top of the food chain, but pretty much everyone else is desperately trying to stay afloat.

And now we have entered an economic downturn during which tens of millions of Americans have lost their jobs. According to John Williams of shadowstats.com, if honest numbers were being used the real unemployment rate in the U.S. would be 26.9 percent right now, and that would rival the worst levels that we witnessed during the Great Depression of the 1930s.

Others have come up with similar numbers. For example, Axios is reporting that the “true unemployment rate” in the United States is currently 26.1 percent…

A person who is looking for a full-time job that pays a living wage — but who can’t find one — is unemployed. If you accept that definition, the true unemployment rate in the U.S. is a stunning 26.1%, according to an important new dataset shared exclusively with “Axios on HBO.”

No matter how you want to crunch the numbers, everyone should be able to agree that millions upon millions of Americans are really hurting financially and are deeply concerned about the future.

And they have good reason to be concerned about the future, because our economic system is in the process of imploding.

For decades, the greatest debt bubble in the history of the world allowed us to enjoy a level of debt-fueled prosperity that was far greater than we actually deserved.

Now the party is ending, and our society is going to experience an enormous amount of pain as everything changes.

***Michael’s new book entitled “Lost Prophecies Of The Future Of America” is now available in paperback and for the Kindle on Amazon.***

Goodbye Middle Class: 50 Percent Of American Workers Make Less Than 33,000 Dollars A Year

October 22, 2019October 22, 2019 by Michael

The truth is that most American families are deeply struggling, but you hardly ever hear this from the mainstream media. Yes, about 10 percent of all American workers are making $100,000 or more a year, but most of those high paying jobs are concentrated in the major cities along the east and west coasts. For much of the rest of the country, these are very challenging times as the cost of living soars but their paychecks do not. According to the Social Security Administration, the median income in the United States last year was just $32,838.05. In other words, 50 percent of American workers made more than $32,838.05 and 50 percent of American workers made less than $32,838.05 in 2018. Let’s be generous and round that number up to $33,000, and when you break it down on a monthly basis it comes to just $2,750 a month. Of course nobody can support a middle class lifestyle for a family of four on $2,750 a month before taxes, and so in most families more than one person is working these days. In fact, in many families today more than one person is working multiple jobs in a desperate attempt to make ends meet, and it still is often not quite enough.

If you want to look at the Social Security wage statistics for yourself, you can find them right here. As you will see, I am not making these numbers up.

These days many would have us feel bad if we are not making at least $100,000 a year, but according to the report only about 10 percent of all American workers make that much money.

Instead, most Americans are in what I would call “the barely getting by” category. Here are some key facts that I pulled out of the report…

-33 percent of all American workers made less than $20,000 last year.

-46 percent of all American workers made less than $30,000 last year.

-58 percent of all American workers made less than $40,000 last year.

-67 percent of all American workers made less than $50,000 last year.

That means that approximately two-thirds of all American workers are making $4,000 or less a month before taxes.

Ouch.

But these numbers help us to understand why survey after survey has shown that most Americans are living paycheck to paycheck. After paying the bills, there just isn’t much money left for most of us.

And for an increasing number of Americans, even paying the bills has become exceedingly difficult. In fact, a brand new report from UBS says that 44 percent of all U.S. consumers “don’t make enough money to cover their expenses”…

Low-income consumers are struggling to make ends meet despite the “greatest economy ever,” and if a recession strikes or the employment cycle continues to decelerate — this could mean the average American with insurmountable debts will likely fall behind on their debt servicing payments, according to a UBS report, first reported by Bloomberg.

UBS analyst Matthew Mish wrote in a recent report that 44% of consumers don’t make enough money to cover their expenses.

That means that about half the country is flat broke and struggling just to survive financially.

Of course those at the top of the economic food chain often don’t have a lot of sympathy for those that are hurting. Many of them have the attitude that those that are struggling should just go out and get one of the “good jobs” that the mainstream media is endlessly touting.

But most jobs in the United States are not “good jobs”.

Today, the poverty level for a household of four in the United States is $25,750. More than 40 percent of the workers in this country make less than that each year.

Starting a business is always an option, but that takes money, and thanks to government regulations it is harder than ever to run a small business successfully.

Just look at what is happening to our dairy farmers. There are few occupations that are more quintessentially “American” than being a dairy farmer, and since most people drink milk and eat cheese, you would think that it would be a pretty safe profession.

But instead, dairy farms are shutting down at a pace that is absolutely chilling all over the nation. For example, just check out what has been going on in Wisconsin…

Wisconsin lost another 42 dairy farms in July, and since January 1, has lost 491 farms, reports the Wisconsin Department of Agriculture, Trade and Consumer Protection.

At this rate, the Dairy State could lose 735 dairy farms this year, which would be a decline of 9%. In 2018, the state lost 691 farms, a rate of decline of 7.9%.

Over the last decade the state has lost more than 5,000 farms, or 40% of its licensed dairy farms. To state the obvious, the current rate of exits is more than double that of the last decade.

So why is this happening?

Government.

In profession after profession, government control freaks have made it nearly impossible to make a living, and this has pushed the percentage of Americans that are self-employed to historic lows.

If you are struggling right now, I want you to know that you are not alone. There are tens of millions of other Americans that are really hurting in this economy, and the bad news is that economic conditions will soon get a lot worse.

But you can make it through whatever is ahead. You just have to keep believing.

A lot of people accuse me of spreading “doom and gloom”, but that is not true at all. There is hope in understand what is happening, and there is hope in getting prepared for the hard times that are ahead. When you take steps to prepare, you are telling yourself and everyone around you that you believe that you can make it through the storm that is coming.

Or you could just have blind faith in the system, even though it is exceedingly obvious that the system is crumbling all around us. Those that are blindly trusting the system to take care of them are building their dreams on a foundation of sand, and when the waves come crashing in those dreams are going to get washed away very quickly.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. I am the publisher of The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I can only allow this to happen if this “About the Author” section is included with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. This article may contain opinions on political matters, but it is not intended to promote the candidacy of any particular political candidate. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.

This Wasn’t Supposed To Happen: U.S. Employment Growth Just Plunged To The Lowest Level In 9 Years

June 5, 2019 by Michael

If the U.S. economy was heading into a recession, we would expect to see a slowdown in the employment numbers, and that is precisely what is happening. According to payroll processing firm ADP, the U.S. economy only added 27,000 new jobs in May, and that is way below the number that is needed just to keep up with population growth. Of course some in the mainstream media are attempting to put a positive spin on this, but there really is no denying that this is a truly awful number. In fact, we have not seen a number this bad in more than 9 years…

Job creation skidded to a near-halt in May in another sign that the U.S. economic momentum is slowing.

Companies added just 27,000 new positions during the month, according to a report Wednesday from payroll processing firm ADP and Moody’s Analytics that was well below Dow Jones estimates of 173,000.

The reading was the worst since around the time the economic expansion began and the jobs market bottomed in March 2010 with a loss of 113,000.

9 years is a very long time, but this terrible employment number is perfectly consistent with all of the other horrible economic numbers that have been rolling in lately.

Time after time in recent weeks I have been using phrases such as “since the last recession” to describe what we are witnessing. The U.S. economy has not been in such rough shape in nearly a decade, and things just keep getting worse.

So how did Wall Street respond to the latest employment news?

Actually, stock prices surged, because investors are super excited about the prospect that the Federal Reserve could soon lower interest rates…

Stocks added to strong week-to-date performance on Wednesday as investors grew even more confident that the Federal Reserve will lower interest rates this year to reignite an economy wounded by trade battles.

The Dow Jones Industrial Average rose 207.39 points to 25,539.57, while the S&P 500 advanced 0.8% to 2,826.15. The Nasdaq Composite closed 0.6% higher at 7,575.48.

Pushing interest rates all the way to the floor certainly helped the stock market recover after the last recession, but this time around there is a major twist.

The U.S. is currently engaged in a major trade war with China, and the normal tools that the Fed utilizes may not be powerful enough to overcome the negative effects of such a conflict.

And to make things worse, now the U.S. is also starting a trade war with Mexico. On Wednesday, President Trump made it clear that “not nearly enough” progress had been achieved during negotiations with Mexican officials…

President Donald Trump said “not nearly enough” progress was made in talks with Mexico to mitigate the flow of undocumented migrants and illegal drugs, raising the likelihood that the U.S. will follow through with tariffs next week.

So tariffs will be slapped on Mexican goods starting on Monday, and President Trump seems quite excited about this…

“If no agreement is reached, Tariffs at the 5% level will begin on Monday, with monthly increases as per schedule,” Trump tweeted Wednesday. “The higher the Tariffs go, the higher the number of companies that will move back to the USA!”

Of course the Mexicans will almost certainly retaliate, and both countries will start seeing higher prices and significant job losses.

In fact, one study has concluded that the U.S. economy could lose more than 400,000 jobs as a result of these tariffs on Mexico. The following comes from CNN…

If the 5% US tariff on all goods from Mexico takes effect and is maintained, more than 400,000 jobs in the United States could be lost, an analysis released this week found.

The tariffs on Mexico, set to go in effect on Monday, would cost Texas alone more than 117,000 jobs, according to the analysis by The Perryman Group, an economic consulting firm. Texas is Mexico’s largest export market, making the two economies closely intertwined.

And the truth is that those numbers could actually be on the low side.

According to Marc Thiessen, a trade war with Mexico would literally put millions of U.S. jobs at risk…

Indeed, Mexican tariffs could be even more devastating for Americans than those imposed on China. Deutsche Bank estimates the tariffs could raise the average price of automobiles sold in the United States by $1,300. Indeed, U.S. and Mexican auto-supply chains are so deeply integrated that many parts cross the border multiple times before they end up in a finished vehicle — which means they would be hit by tariffs multiple times, compounding costs. Ten million U.S. workers’ jobs depend on this supply chain; tariffs would put those jobs at risk, including those of the “forgotten Americans” in the industrial Midwest whose jobs Trump vowed to protect.

We shall see what happens, but the outlook for the U.S. economy for the rest of this year is not good at all, and beyond that things look exceedingly grim.

Hopefully I am wrong, but it certainly appears that a major economic downturn is developing just in time for the 2020 presidential election.

There is one more thing that I would like to mention before I wrap up this article. This week, a Russian news source reported that Russia and China “will sign an agreement” regarding the use of their own national currencies in bilateral trade with one another…

Russia and China will sign an agreement on possible payments in national currencies. A decree of the Russian government on signing of a relevant agreement with the Chinese side was released on the official portal of legal information on Wednesday.

According to the draft decree approved through that government document, “settlements and payments for goods, service and direct investments between economic entities of the Russian Federation and the People’s Republic of China are made in accordance with the international practice and the legislation of the sides’ states with the use of foreign currency, the Russian currency (rubles) and the Chinese currency (yuan).”

In other words, they are dumping the dollar in favor of their own national currencies when trading with each other. This is a direct threat to the international dominance of the U.S. dollar, and other countries have been discussing similar moves.

For decades, the U.S. dollar has essentially been a global currency. More dollars are actually used outside of the United States than within this country, and most Americans don’t realize that.

This has given us some enormous advantages in the global marketplace, and it could be just a matter of time before those advantages begin to disappear.

Things that used to take months or years to happen are now happening in a matter of days. The pace of change is really picking up, and right now the momentum of events is heading in a direction that is definitely not favorable to the United States.

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

Goodbye Middle Class: The Percentage Of Wealth Owned By The Top 10% Just Got Even BIGGER

June 4, 2019June 4, 2019 by Michael

The middle class in America is being systematically eviscerated, and it is getting worse with each passing year. As you will see below, one new study has found that 10 percent of Americans now own 70 percent of all the wealth. Once upon a time, the United States had the largest and most vibrant middle class in the history of the world, but pretty soon we are just going to have the ultra-wealthy and everyone else. Our system has been designed to funnel as much wealth as possible to the very top of the financial pyramid, and that means that most of the rest of us are deeply struggling. And when you are just barely getting by from month to month, all it takes is one bad break to knock you completely out of the middle class and into poverty.

I have been chronicling the demise of the middle class for many years, but I didn’t know that the numbers had gotten this bad. According to a study that was recently conducted by the Federal Reserve, the percentage of wealth controlled by the top 10 percent of U.S. households has shot up from 60 percent in 1989 to 70 percent today…

Deutsche Bank’s Torsten Sløk says that the distribution of household wealth in America has become even more disproportionate over the past decade, with the richest 10% of U.S. households representing 70% of all U.S. wealth in 2018, compared with 60% in 1989, according to a recent study by researchers at the Federal Reserve.

The study finds that the share of wealth among the richest 1% increased to 32% from 23% over the same period.

The ironic thing is that the Federal Reserve has actually done much to cause this high concentration of wealth among the elite. In response to the last financial crisis, the Federal Reserve pumped unprecedented amounts of money into the financial system, and this has created the greatest stock market bubble in our history…

The Dow Jones Industrial Average DJIA, +2.06% has climbed nearly 300% since its closing low in March 2009, the S&P 500 index SPX, +2.14% has climbed 325%, while the Nasdaq Composite Index COMP, +2.65% has soared 535% over the same period.

Meanwhile, wages have stagnated for ordinary Americans. According to the Social Security Administration, the median yearly wage in the United States is currently just $30,533. In other words, 50 percent of all American workers make at least that much per year, and 50 percent of all American workers make that much or less per year.

$30,533 a year breaks down to approximately $2,500 per month, and you simply can’t support a middle class lifestyle for a typical American family on $2,500 a month.

Meanwhile, the cost of living for middle class families has exploded higher over the past few decades…

Everyday expenses continue to rise, and as the shadow inflation increases, it also threatens to wipe out the middle class – what’s left of it anyway. In fact, middle-class life is now 30% more expensive than it was 20 years ago, according to a separate report by CNBC. The cost of things such as college, housing, and child care has risen precipitously: Tuition at public universities doubled between 1996 and 2016 and housing prices in popular cities have quadrupled, Alissa Quart, author and executive director of the Economic Hardship Reporting Project, tells CNBC Make It.

As the cost of living has risen faster than our incomes have, more Americans have been squeezed out of the middle class with each passing month.

As a result, an increasing number of Americans have become financially dependent on the government, and our rapidly expanding welfare state is a big reason why the federal government is now 22 trillion dollars in debt.

Of course many Americans are no longer able to make it at all, and the ranks of the homeless are swelling all over the nation. In fact, we just got some brand new numbers about the growth of homelessness in the Los Angeles area that are absolutely eye-popping…

The number of homeless people counted across Los Angeles County jumped 12% over the past year to nearly 59,000, with more young and old residents and families on the streets, officials said Tuesday.

The majority of the homeless were found within the city of Los Angeles, which saw a 16% increase to 36,300, the Los Angeles Homeless Services Authority said in presenting January’s annual count to the county Board of Supervisors.

Yes, it is true that we have a record number of millionaires on the west coast in 2019, but meanwhile our major west coast cities are being transformed into rotting, decaying nightmares right in front of our eyes.

During a recent interview with Laura Ingraham, Dr. Drew Pinsky admitted that there is “a complete breakdown of the basic needs of civilization in Los Angeles right now”…

“We have a complete breakdown of the basic needs of civilization in Los Angeles right now,” Pinsky told host Laura Ingraham. “We have the three prongs of airborne disease, tuberculosis is exploding, (and) rodent-borne. We are one of the only cities in the country that doesn’t have a rodent control program, and sanitation has broken down.”

Pinsky’s comments followed news that Los Angeles police officer had contracted typhoid fever, a rare and life-threatening illness that fewer than 350 Americans contract each year.

Los Angeles had a typhus outbreak last summer and will likely have another this summer, Pinsky said. Meanwhile, bubonic plague – a pandemic that killed tens of millions of people during the 14th century – is “likely” already present in Los Angeles, Pinsky added.

Despite all of our great wealth and despite all of our advanced technology, this is what life is like in our second largest city right now.

And if things are degenerating this badly during stable times, what are things going to look like once our society plunges into chaos?

Ultimately, the American Dream is about being self-sufficient. Most people want to be able to work hard and provide a nice life for their families, but that is becoming harder and harder to do.

No matter which political party has been in power in Washington, the middle class has continued to shrink and more wealth and power has become concentrated in the hands of the elite.

Now we stand on the precipice of the next major economic downturn, and many are deeply concerned about what that is going to mean for the future of our society.

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

June 3, 2019 by Michael

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

May 28, 2019 by Michael

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Even Before The Recession Has Officially Begun, Some Large U.S. Firms Are Laying Off Thousands Of Workers

May 20, 2019 by Michael

If the U.S. economy is “booming” and very bright days are ahead, then why are many large U.S. corporations laying off thousands of workers? Layoffs are starting to come fast and furious now, and this is happening even though the coming recession has not even officially started yet. Of course many are convinced that we are actually in a recession at this moment. In fact, according to John Williams of shadowstats.com if the government was actually using honest numbers they would show that we have been in a recession for quite some time. But the narrative that the mainstream media keeps feeding us is that the U.S. economy is “doing well” and that the outlook for the future is positive. Well, if that is true then why are big companies laying off so many workers right now?

Let’s start by talking about Ford Motor Company. On Monday, they announced that they will be laying off approximately 7,000 workers…

Ford Motor said Monday that it is laying off about 7,000 managers and other salaried employees, about 10% of its white-collar workforce across the globe, as part of a restructuring plan designed to save the No. 2 automaker $600 million annually.

The cuts, some of which were previously announced by the company, will be completed by August, Ford CEO Jim Hackett said in an email to employees Monday.

If the U.S. economy was about to take off like a rocket, this move doesn’t make any sense at all.

But if we are headed into a recession, this move makes perfect sense.

Another large firm that is laying off thousands of workers is Nestle…

Nestle SA’s U.S. unit will dismiss about 4,000 workers as it stops delivering frozen pizza and ice cream directly to stores and transitions to a warehouse model that’s becoming an industry standard for Big Food companies looking to trim costs.

And we also recently learned that 3M is planning to get rid of about 2,000 workers…

3M plans to cut 2,000 globally as part of a restructuring due to a slower-than-expected 2019.

The maker of Post-it notes, industrial coatings and ceramics said Thursday that the move is expected to save about $225 million to $250 million a year. The St. Paul Minnesota-based company anticipates a pretax charge of about $150 million, or 20 cents per share, this year.

Did you catch that part about these layoffs being due to “a slower-than-expected 2019”?

Unfortunately, things are slow for a lot of companies out there these days.

Another company that is dumping a large number of workers is MGM Resorts…

MGM Resorts International MGM, -2.09% plans to cut about 1,000 positions by the end of the current quarter amid a cost-cutting and operational overhaul that calls for fewer managers across its properties.

That figure includes some 254 positions that the company moved to eliminate last week.

In addition, Dressbarn just announced that all of their stores will be closing…

Dressbarn is closing all of its stores.

The women’s retailer announced Monday “plans to commence a wind-down of its retail operations, including the eventual closure of its approximately 650 stores.”

I am not sure how many employees they have per store, but even if it is just a handful we are talking about the loss of thousands of jobs.

The U.S. economy has been slowing down for months, and now the complete breakdown of trade talks with China threatens to plunge us into a prolonged trade war. As I noted in another article, a couple of different studies have concluded that an extended trade war could literally cost our economy millions of lost jobs.

And once the job losses start rolling, they can really get out of hand very quickly. We saw this in 2008, and it is just a matter of time until we see it happen again.

On Sunday, a reader sent me an article about a factory closing that was happening in her neck of the woods in Pennsylvania. One worker that was laid off said that the closure of the facility “was the final kick in the gut”…

Robert and Brooks Gronlund, owners of Wood-Mode Inc., wrote a text to workers Friday, saying they “are extremely appreciative” of the employees’ contributions and commitments. The company owners then confirmed all of them were terminated, as were their benefits.

“It was the final kick in the gut,” Michele Sanders, a 22-year employee of the company, said Saturday.

The privately-owned company in Kreamer, which produced custom wood cabinets, shut its doors Monday, leaving nearly 1,000 people without jobs. The abrupt closure of the plant stunned workers and community leaders.

So now almost 1,000 people do not have a way to support themselves and their families.

We are talking about hard working people with real hopes and real dreams.

Kreamer is a very small town. According to Wikipedia, only 773 people live within the city limits, and so obviously there are not a lot of employment opportunities in the town.

And if those workers are anything like the rest of the U.S. population, most of them were probably living paycheck to paycheck.

I keep encouraging my readers to build an emergency fund, because you never know when you will be next on the employment chopping block. I personally know a number of people that have just lost their jobs, and it can be an absolutely devastating experience.

Unfortunately, it looks like what we have witnessed so far is just the beginning. All of the numbers tell us that economic activity is slowing down, and so we should all get ready to potentially face a rapidly deteriorating economic environment during the second half of 2019.

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