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20 Shocking New Economic Records That Were Set In 2010

2010 was quite a year, wasn’t it?  2010 will be remembered for a lot of things, but for those living in the United States, one of the main things that last year will be remembered for is economic decline.  The number of foreclosure filings set a new record, the number of home repossessions set a new record, the number of bankruptcies went up again, the number of Americans that became so discouraged that they simply quit looking for work reached a new all-time high and the number of Americans on food stamps kept setting a brand new record every single month.  Meanwhile, U.S. government debt reached record highs, state government debt reached record highs and local government debt reached record highs.  What a mess!  In fact, even many of the “good” economic records that were set during 2010 were indications of underlying economic weakness.  For example, the price of gold set an all-time record during 2010, but one of the primary reasons for the increase in the price of gold was that the U.S. dollar was rapidly losing value.  Most Americans had been hoping that 2010 would be the beginning of better times, but unfortunately economic conditions just kept getting worse.

So will things improve in 2011?  That would be nice, but at this point there are not a whole lot of reasons to be optimistic about the economy.  The truth is that we are trapped in a period of long-term economic decline and we are now paying the price for decades of horrible decisions.

Amazingly, many of our politicians and many in the mainstream media have declared that “the recession is over” and that the U.S. economy is steadily improving now.

Well, if anyone tries to tell you that the economy got better in 2010, just show them the statistics below.  That should shut them up for a while.

The following are 20 new economic records that were set during 2010….

#1 An all-time record of 2.87 million U.S. households received a foreclosure filing in 2010.

#2 The number of homes that were actually repossessed reached the 1 million mark for the first time ever during 2010.

#3 The price of gold moved above $1400 an ounce for the first time ever during 2010.

#4 According to the American Bankruptcy Institute, approximately 1.53 million consumer bankruptcy petitions were filed in 2010, which was up 9 percent from 1.41 million in 2009.  This was the highest number of personal bankruptcies we have seen since the U.S. Congress substantially tightened U.S. bankruptcy law several years ago.

#5 At one point during 2010, the average time needed to find a job in the United States had risen to an all-time record of 35.2 weeks.

#6 Back in 1970, 25 percent of all jobs in the United States were manufacturing jobs. Today, only 9 percent of the jobs in the United States are manufacturing jobs, which is believed to be a new record low.

#7 The number of Americans working part-time jobs “for economic reasons” was the highest it has been in at least five decades during 2010.

#8 The number of American workers that are so discouraged that they have given up searching for work reached an all-time high near the end of 2010.

#9 Government spending continues to set new all-time records.  In fact, at the moment the U.S. government is spending approximately 6.85 million dollars every single minute.

#10 The number of Americans on food stamps surpassed 43 million by the end of 2010.  This was a new all-time record, and government officials fully expect the number of Americans enrolled in the program to continue to increase throughout 2011.

#11 The number of Americans on Medicaid surpassed 50 million for the first time ever in 2010.

#12 The U.S. Census Bureau originally announced that 43.6 million Americans are now living in poverty and according to them that was the highest number of Americans living in poverty that they had ever recorded in 51 years of record-keeping.  But now the Census Bureau says that they miscalculated and that the real number of poor Americans is actually 47.8 million.

#13 According to the FDIC, 157 banks failed during 2010.  That was the highest number of bank failures that the United States has experienced in any single year during the past decade.

#14 The Federal Reserve brought in a record $80.9 billion in profits during 2010.  They returned $78.4 billion of that to the U.S. Treasury, but the real story is that thanks to the Federal Reserve’s continual debasement of our currency, the U.S. dollar was worth less in 2010 than it ever had been before.

#15 It is projected that the major financial firms on Wall Street will pay out an all-time record of $144 billion in compensation for 2010.

#16 Americans now owe more than $881 billion on student loans, which is a new all-time record.

#17 In July, sales of new homes in the United States declined to the lowest level ever recorded.

#18 According to Zillow, U.S. housing prices have now declined a whopping 26 percent since their peak in June 2006.  Amazingly, this is even farther than house prices fell during the Great Depression.  From 1928 to 1933, U.S. housing prices only fell 25.9 percent.

#19 State and local government debt reached at an all-time record of 22 percent of U.S. GDP during 2010.

#20 The U.S. national debt has surpassed the 14 trillion dollar mark for the first time ever and it is being projected that it will soar well past 15 trillion during 2011.

There are some people that have a hard time really grasping what statistics actually mean.  For people like that, often pictures and charts are much more effective.  Well, that is one reason I like to include pictures and graphs in many of my articles, and below I have posted my favorite chart from this past year.  It shows the growth of the U.S. national debt from 1940 until today.  I honestly don’t know how anyone can look at this chart and still be convinced that our nation is not headed for a complete financial meltdown….

Economic War

Most Americans have no idea what an “economic war” is, and even fewer realize that economic warfare is being waged against the United States right now.  For generations, it has been drummed into our heads that “free trade” is always a good thing and that truly free trade will always benefit both sides in the long run.  None of our universities teach that trade can actually also be used as a brutally effective weapon of warfare and that economic warfare can bring down entire societies.  Nowhere in the mainstream media will you even get a hint that other nations are purposely trying to damage the U.S. economy for their own benefit.  But in a world where a “shooting war” with the United States is virtually unthinkable, those that wish to damage the U.S. must resort to other means to accomplish their goals.

The American people need to wake up and stop being so naive.  The truth is that much of the rest of the world absolutely hates our guts.  They resent our dominance and they are tired of us imposing our will on the rest of the globe.  For generations, Americans have been taught to view themselves as “the good guys”, but the sad fact of the matter is that most of the rest of the world does not view us as “the good guys” anymore.

In fact, there are quite a few nations out there that would actively like to do us harm.

So if they can’t shoot at us, then how can they harm us?

Well, they can try to destroy us financially and economically.

Today, major exporting nations around the globe are draining the United States of wealth, they are stealing our industries and they are feeding our national debt addiction.

For some of these nations, they may not actively want to destroy our economy, but they sure do want to steal what we have got.  They are more than happy to keep trading with us as long as they keep getting wealthier and their national economic infrastructure continues to get built up.  The fact that their economies are getting stronger at the expense of the U.S. economy is not really a huge concern for nations in this category.

However, there are also quite a few nations that do actively wish to do harm to the United States.  If trading with the United States will cause the U.S. to become poorer and to go into more debt, then that is a tool that they can use to reduce the power and influence of the Americans in the world.

Is this something that really happens?  Yes.  Do yourself a favor some time and read some economic articles and research papers from the other side of the world.  In some of these countries they are not afraid to openly talk about economic war.

So what are some of the goals of economic warfare?

Well, when it comes to the United States, the goal is to induce big corporations (or even entire industries) to leave the U.S. and set up shop somewhere else.  The idea is that the economic infrastructure of the United States will decline while the economic infrastructure of the “attacking nation” will be built up.  The jobs and wealth creation that once were a benefit to America will now benefit someone else.

Another goal is to transfer wealth from the target country (the United States) to the attacking country.  Each month the United States buys tens of billions of dollars more stuff from the rest of the world than they buy from us.  Each month we send them big chunks of our national wealth and they send us oil and cheap plastic trinkets which we greedily consume.  As this continues month after month after month, the rest of the world is getting richer while the United States is becoming poorer.

In a desperate attempt to maintain our standard of living, our federal government, our state governments and even our local governments are going into insane amounts of debt.  Debt is another tool of economic warfare.  As we continue to borrow trillions of dollars from the rest of the world, the ability of the United States to exert power and control over those nations diminishes.

The eventual goal of waging economic warfare against the United States is to make us so impoverished and so far in debt that our entire financial system crashes.  If the U.S. experiences a “financial armageddon”, it will greatly reduce America’s place in the world.  It could ultimately lead to the collapse of the U.S. government.  Other nations (or organizations) that wish to have more power would then be able to fill the void that would be created.

So what are the tools of economic warfare?

One is currency manipulation.  By keeping national currencies at an artificially low level, major exporting nations make their own exports much more attractive, thus stimulating job growth and wealth creation in their own nations.

Another tool of economic war is government subsidization of industries.  Virtually all governments do this to some degree these days, but some take it much farther than others.

For example, there are some governments in Asia that will openly pump huge piles of government money into industries that are considered to be of “national interest”.  There is simply no way that western industries can compete on an equal footing against that kind of unfair advantage.

In the United States, companies face one of the highest overall tax rates in the world, they face mountains of ridiculous regulations and they have to provide health care and retirement benefits for their employees.  But in other areas of the world the government takes care of health care for everyone, regulations are much less strict and corporate tax rates are much lower.

Is it any wonder why so many U.S. companies are having such a hard time today?

Another weapon of economic warfare is technology theft.

U.S. companies spend billions upon billions of dollars developing new technology that gets “stolen” one way or another by many foreign governments.

For example, there is one major Asian nation that offers huge tax incentives and kickbacks to big companies to get them to come over and set up shop there.  But these companies are also required to train and hire local workers and they must agree to certain “technology disclosures”.

Well, after a time the host nation sets us their own “domestic competitors” using the technology that they have acquired from the foreign company.  Then the “domestic competitors” are tremendously subsidized and are given huge advantages that the original foreign company simply cannot compete with.  Eventually the “domestic competitors” become the dominant players in the market.

This is happening over and over and over.  Companies are shutting down operations in the United States and are opening up facilities in other nations where the labor is much cheaper, where regulations are not nearly as suffocating and where taxes are much lower.  However, once these other nations learn the technology and are able to set up “domestic competitors”, the original companies are learning that maybe it wasn’t such a sweet deal they were being offered after all.

As the U.S. is being stripped of industry and is being deindustrialized, the American middle class is being absolutely devastated.  Since the year 2000, we have lost 10% of our middle class jobs.  In the year 2000 there were about 72 million middle class jobs in the United States but today there are only about 65 million middle class jobs.  Sadly, the millions of jobs that have been sent overseas are never coming back.

Meanwhile, our national wealth is being drained from our bank accounts.  Back in 1985, the U.S. trade deficit with one particular Asian nation was just 6 million dollars for the entire year.  But for this past August alone, the trade deficit with that same nation was over 28 billion (that’s billion with a “b”) dollars.

In other words, the U.S. trade deficit with that one Asian nation in August was more than 4,600 times larger than the U.S. trade deficit with that Asian nation was for the entire year of 1985.

So how are we maintaining our high standard of living if we are shipping all of our wealth overseas?

Well, what we are doing is going back to all those nations where we have sent our wealth and we are begging them to loan it back to us.

Our federal government now owes trillions of dollars to major exporting nations.  Our state governments also owe insane amounts of money to major exporting nations.  We are in debt up to our eyeballs and it gets worse every single year.

Meanwhile, our national economic infrastructure is being absolutely ripped to shreds….

*Back in 1970, 25 percent of all jobs in the United States were manufacturing jobs. Today, only 9 percent of the jobs in the United States are manufacturing jobs.

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

*Since 2001, over 42,000 U.S. factories have closed down for good.

*As of the end of 2009, less than 12 million Americans worked in manufacturing.  The last time that less than 12 million Americans were employed in manufacturing was in 1941.

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

The sad truth is that the U.S. is being dominated even in very high-tech industries.  The major exporting nations are becoming rich by creating wealth and we are becoming poor by voraciously consuming wealth.

Unfortunately, some of the major exporting nations that we have a massively imbalanced trade relationship with are doing this to us on purpose.  They see our weakness and the are taking advantage of it.  They believe that it is in their own national interests to make the United States weaker.

Sadly, a very significant percentage of those that will read this article will not believe it.  Most Americans have been so brainwashed when it comes to trade that they could never even conceive that it could possibly be used as a weapon of economic war.

But the truth is that there are even many prominent Americans that openly talk of weakening the U.S. economy and of reducing the standard of living of the U.S. middle class so that we can be more easily merged into the emerging global economic system.

It is time to wake up.  The United States is under economic attack.

More jobs are going to leave the United States this month.  More factories are going to leave the United States this month.  Tens of billions more dollars of our national wealth is going to be transferred out of the country this month.  Our federal, state and local governments are all going to go into more debt to foreigners this month.

Month after month after month this goes on.  It is being done by design.

Perhaps when the entire U.S. financial system collapses the American people will finally begin to understand.  The truth is that the greatest threats to our national security are not some impoverished goat herders hiding out in caves in Afghanistan.  Rather, the cold, hard reality of the situation is that our national economic infrastructure is being ripped apart and stolen right in front of our eyes and we have become so dumbed-down that we don’t even understand what is happening.

If you want to see “the future of America”, just tour some of the formerly great industrial centers of the upper Midwest some time.  Ask yourself why “the greatest economy on earth” has so many abandoned factories and boarded-up homes.  There are many decaying communities across America right now that are so depressing that the moment you enter them you get the sense that all of the hope has been sucked right out of them.

The U.S. economy is under attack and it is dying.  We are being looted and pillaged from coast to coast.  This is really happening.

So what do you think about all of this?  Please feel free to leave a comment with your opinion below….

George Soros: The United States Must Stop Resisting The Orderly Decline Of The Dollar, The Coming Global Currency And The New World Order

In the video you are about to see, George Soros talks about “the creation of a New World Order”, he discusses the need for a “managed decline” of the U.S. dollar and he talks at length of the global need for a true world currency. So just who is George Soros? Well, he is a billionaire “philanthropist” who came to be known as “the Man Who Broke the Bank of England” when he raked in a staggering one billion dollars during the 1992 “Black Wednesday” currency crisis. These days Soros is most famous for being perhaps the most “politically active” (at least openly) billionaire in the world. His Open Society Institute is in more than 60 countries and it spends approximately $600 million a year promoting the ideals that Soros wants promoted. Soros and his pet organizations have played a key role in quite a few “revolutions” around the globe over the last several decades, but these days the main goal of George Soros is to bring political change to the United States.

So exactly what is it that George Soros is trying to accomplish? Well, in a nutshell, what he wants is a Big Brother-style one world government based on extreme European-style socialism, strict population control and the radical green agenda. It would be a world where the state tightly regulates everything that we do for the greater benefit of the environment and of society as a whole.

However, Soros is not the “mastermind of the New World Order” that some have tried to make him out to be.  The truth is that to those in the international banking elite, Soros is considered to be something of a “black sheep” and an “outsider”.  Much of what Soros is trying to accomplish lines up with the goals of the international banking elite, but what they don’t like is that Soros won’t stop publicly talking about a global currency and a “New World Order”.  Of course the international banking elite very much want a global currency and a “New World Order”, but what they don’t need is a “squeaky wheel” like Soros running around drawing unneeded attention to those goals.

Also, Soros does not seem to understand that both sides of the political spectrum in the United States are deeply influenced by the international banking elite.  Sadly, the truth is that the same handful of elitist organizations has dominated the cabinets of every single president that we have had since World War II.  If you doubt this, just check out how many members of each presidential administration over the last 40 years have belonged to either the Council on Foreign Relations, the Trilateral Commission or the Bilderberg Group.  If you have never looked into this before, you will be absolutely shocked.  No matter what president we elect, it is always the exact same organizations that always dominate their cabinets.

But Soros still seems very much trapped within the left/right paradigm and he seems absolutely obsessed with destroying the Republican Party.  For example, Soros spent an insane amount of money attempting to defeat George W. Bush back in 2004.  According to the Center for Responsive Politics, George Soros donated $23,581,000 during that election cycle to political organizations that were trying to keep Bush from being reelected.

Soros has also been a tremendous backer of Barack Obama, although lately Soros seems a bit disenchanted with him.  Through organizations such as the Center for American Progress and MoveOn.org, Soros is constantly trying to influence the state of American politics.

So what is George Soros thinking about these days?  Well, in the video posted below you will see Soros discussing “an orderly decline” of the U.S. dollar, the coming global currency and the importance of the New World Order….

Did you noticed how uncomfortable Soros was when he was saying the term “New World Order”?

The truth is that he knows exactly what that phrase means.  He knows that it is a phrase that he probably shouldn’t say and that will get a lot of attention.

But he said it anyway.

Soros also seemed a bit uncomfortable as he discussed “an orderly decline” of the U.S. dollar.

Soros has been saying the the U.S. dollar needs to go down for quite a while now, and he speaks of the coming fall of the dollar as if it is inevitable.

The only thing that Soros seems to fear is that the “managed decline” of the dollar could “get out of hand” and could lead to global financial chaos.

Soros even had the gall to say that having the dollar be the reserve currency of the world is not in our national interest and that a move to a global currency is “a healthy, if painful, adjustment” that we are just going to have to endure for the greater good of the world economy.

But shouldn’t the American people have something to say about all of this?

Perhaps the American people do not want a “managed decline” of the U.S. dollar.

Perhaps the American people do not want any part of a new “global currency”.

Perhaps the American people do not want any part of a “New World Order”.

But to men like George Soros, it doesn’t really matter what “the little people” think.  In the world that Soros lives in, those with overwhelming amounts of money and power know what is best for the rest of us, and if “the little people” don’t seem to want to go along initially then public opinion can be bought if you just spend enough money.

The sad truth is that we already live in a global economy.  Just go into just about any store across the United States and start picking up products to see where they were made.  Very few of the things we buy are still made in the United States.

Today, labor is a global commodity.  American workers must now directly compete for jobs with those making slave labor wages in China and India.  The fact that millions of U.S. jobs are being offshored and outsourced does not bother advocates of globalism at all because it is supposedly a beneficial thing for the overall global economy.

And most Americans have little to no idea just how much influence international organizations such as the United Nations, the World Bank, the IMF and the WTO have over our daily lives.

The truth is that we already live in a world that has been deeply, deeply integrated.  As this continues, at some point it will only seem “natural” for America to agree to a true global currency and full global political integration.

Let us hope that day never arrives.  Or at least let us hope that the American people wake up enough to not just go passively into a “New World Order”.

A global economy is bad for America and a global government would be really bad for America.

But perhaps you disagree.  Perhaps you believe that integrating our economy, our currency and our government with the rest of the world would be a wonderful thing.  If that is the case, please feel free to leave a comment explaining exactly why globalism is such a wonderful thing for all of us….

The Shadow Banking System: A Third Of All The Wealth In The World Is Held In Offshore Banks

You and I live in a totally different world than the ultra-rich and the international banking elite do.  Many of them live in a world where they simply do not pay income taxes.  Today, it is estimated that a third of all the wealth in the world is held in offshore banks.  So why is so much of the wealth of the globe located in places such as Monaco, the Cayman Islands, Bermuda, the Bahamas, and the Isle of Man?  It isn’t because those are fun places to visit.  It is to avoid taxes.  The super wealthy and the international banking elite think that it is really funny that our paychecks are constantly being drained by federal taxes, state taxes and Social Security taxes while they literally pay nothing at all.  These incredibly rich elitists make a ton of money doing business in wealthy western nations and then they transfer virtually all of their profits offshore where they don’t have to contribute any of it in taxes.  It works out really great for them, but it sucks for the rest of us.

It is estimated that approximately $1.4 trillion is held in offshore banks in the Cayman Islands alone. According to an article in Forbes magazine, there is a total of approximately 15 trillion to 20 trillion dollars in offshore bank accounts, brokerage accounts and hedge fund portfolios.

A recent article in the Guardian stated that a third of all the wealth on the entire globe is held in offshore banks and that the vast majority of international banking transactions take place in these tax havens….

On a conservative estimate, a third of the world’s wealth is held offshore, with 80% of international banking transactions taking place there. More than half the capital in the world’s stock exchanges is “parked” offshore at some point.

All of the biggest banks in the world are involved in playing this game.  All of them have big branches in these various tax havens.  All of them work very hard to ensure that the tax burdens on their ultra-rich clients are as light as possible.

Nobody knows for sure how much money big governments around the globe are missing out on from all this tax avoidance, but everyone agrees the number is huge.  It is at least in the hundreds of billions of dollars every single year.

It is a shadow banking system that most Americans don’t know anything about. Most Americans don’t have the resources to be able to set up shell companies in half a dozen different countries so that they can “filter” their profits.  Most Americans don’t know a thing about complicated tax avoidance plans that tax lawyers use such as the “Double Irish” and the “Dutch Sandwich”.  Most Americans would have no idea how to eventually have most of the money that they make end up in Bermuda so that it can avoid taxes.

No, most Americans just go to work every week and have their hard earned paychecks raped by an oppressive taxation system.

To the ultra-wealthy and the international banking system we are all just a bunch of suckers.  In fact, a big portion of our taxes ends up going into their pockets to pay the interest on all of the government debt that they are holding.

When the global elite decide that they want to do some “social engineering” inside the big countries where they operate, they just set up tax-free “charitable trusts” that usually aren’t very “charity-oriented” at all.  Rather, many of these “charitable trusts” push the various radical political and social agendas that many of these elitists love to promote.

Examples of this include The Rockefeller Foundation and The Ford Foundation.  George Soros also loves to use entities like these to push his various agendas.

The wealthy know how to play the game.  For most of the rest of us, the game kicks our behinds.

So for those who are constantly screaming “tax the rich”, the cold, hard truth of the matter is that those who are truly ultra-rich know how to escape just about any oppressive tax regime you may set up.  They are light years ahead of the rest of us in knowing how to play the game.

What are you going to do?

Kick them out of the country?

Yeah, they will be really sad to spend even more time down in Bermuda or in the Cayman Islands.

Are you going to kick out any company that has any stock holders that have offshore bank accounts?

Well, you would have to kick out virtually every single major corporation in the United States.

This is just another example of how deeply flawed our system of income taxation really is.

Do you want to become a master of the tax code?

You might want to set aside some time for reading.

A lot of time.

The income tax code and its associated regulations contain well over 7 million words and are more than seven times longer than the Bible.

The IRS employs more than 90,000 people and it costs more than 11 billion dollars a year to operate.

Talk about a colossal waste of resources.

Meanwhile, the ultra-rich are just parking all of their money in Bermuda and the Caymans and are laughing at all the rest of us.

It would be hard to understate just how much influence and power all of this offshore money has.  The ultra-wealthy and the elite international bankers own many of our largest corporations, they exert influence over central banks, they control big media outlets and they “contribute money” (bribes) to political campaigns.

The elite are always two steps ahead of any new laws that get passed.  They are masters at moving money around.  They will quickly find a half dozen ways around any new law that you could possibly dream up.

Most of us never even get to meet any of these incredibly wealthy individuals.  They don’t attend the local church or go shopping down at the local shopping mall.

No, the global elite generally live in very exclusive gated estates or hang out at the most expensive private resorts.  They don’t spend a lot of time mixing with the rabble.

It turns out that life is pretty good when you have a ton of money coming in and you pay next to nothing in taxes.

So the next time you get your paycheck and you see that a half a dozen things have been taken out of it, take a few moments to think of the global elite that don’t pay any taxes at all and see how that makes you feel.

Hopefully when enough Americans get mad enough and start demanding change, the current income tax system will be scrapped for good and something much more equitable will be put in place instead.

Currency War

Are you ready for a currency war?  Well, buckle up, because things are about to get interesting.  This week Japan fired what is perhaps the opening salvo in a new round of currency wars by publicly intervening in the foreign exchange market for the first time since 2004.  Japan’s bold 12 billion dollar move to push down the value of the yen made headlines all over the world.  Japan’s economy is highly dependent on exports and the Japanese government was becoming increasingly alarmed by the recent surge in the value of the yen.  A stronger yen makes Japanese exports more expensive for other nations and thus would harm Japanese industry.  But Japan is not the only nation that is ready to go to battle over currency rates.  The governments of the U.S. and China continue to exchange increasingly heated rhetoric regarding currency policy.  In Europe, there is growing sentiment that the euro needs to be devalued in order to help European exports become more competitive.  In addition, exporters all over the world are already loudly complaining about the possibility that the Federal Reserve is about to unleash another round of quantitative easing.  Virtually all major exporting nations want the value of the U.S. dollar to remain high so that they can keep flooding us with lots of cheap goods.  The sad reality is that our current system of globalized trade rewards exporting nations that have weak currencies, and many nations have now shown that they are willing to take the gloves off to make certain that their national currencies do not appreciate in value by too much.

Some nations have been involved in open currency manipulation for some time now.  For example, Singapore is well known for intervening in the foreign exchange market in order to benefit exporters.  Also, the Swiss National Bank experienced losses equivalent to about 15 billion dollars trying to stop the rapid rise of the Swiss franc earlier this year.

But as we race toward the end of 2010, currency manipulation is becoming a major issue on the world stage.

Rumors that the Federal Reserve is considering a substantial new round of quantitative easing is already causing many major exporting nations around the world to howl in outrage. 

Why?

Well, quantitative easing by the Federal Reserve could put substantial downward pressure on the value of the dollar and that would make exports significantly more expensive in the United States.  The reality is that even a relatively small change in the value of the U.S. dollar can have a major impact on exporters.

But what could really set off a massive currency war is the ongoing dispute between the U.S. and China.

For years, China has kept the value of their currency artificially low.  Even though China has made a few small moves toward a more free-floating currency policy, at this point China’s currency is still pretty much pegged to the U.S. dollar.  It is estimated that the Chinese government is keeping China’s currency at a value about 40 percent lower than what it should be.  This is essentially a de facto subsidy to China’s exporters.

This has enabled China to flood the United States with cheap goods and it is killing entire industries in the United States.  Americans have loved rushing out to Wal-Mart to get super low prices on all kinds of stuff, but in the process we have slowly but surely been shipping our manufacturing base and our standard of living over to China.

In recent years both the Bush administration and the Obama administration have been whining about this currency manipulation by China, but both administrations have stopped short of taking any real action.

But are there now signs that the Obama administration is going to get serious and start a currency war? 

Well, last week Barack Obama did send the head of his national council of economic advisers, Larry Summers, to Beijing to discuss currency issues.

But what can we do other than whine at this point?

Are we willing to start a trade war?

Considering the fact that China holds nearly a trillion dollars worth of U.S. Treasuries, that probably would not go so well for us.

Even though China’s currency manipulation is absolutely raping the U.S. economy, China has so much leverage over us at this point that it isn’t even funny.

For example, China has almost a complete and total monopoly on rare earth elements.  If China totally cut off the supply of rare earth elements, we would have no hybrid car batteries, flat screen televisions, cell phones or iPods.  Not only that, but rare earth elements are used by the U.S. military in radar systems, missile-guidance systems, satellites and aircraft electronics.

But something has to be done.  Essentially we are caught between a rock and a hard place.

Today, the United States spends approximately $3.90 on Chinese goods for every $1 that the Chinese spend on goods from the United States. 

Last month, the monthly trade deficit with China was approximately 26 billion dollars.  For the year, the trade deficit with China will be somewhere in the neighborhood of 300 billion dollars or so.  The transfer of wealth to China that represents is absolutely mind blowing.

The U.S. economy is getting poorer and the Chinese economy is getting richer each and every month.

We are in decline and China is on the rise.  In fact, one prominent economist is projecting that the Chinese economy will be three times larger than the U.S. economy by the year 2040.

This would not have ever happened if we had not put up with China’s open and blatant currency manipulation all this time.

But now they have us over a barrel and standing up to China would be incredibly painful for the U.S. economy in the short-term.

So will we actually see a currency war break out soon?

Well, it seems almost a certainly that countries throughout the world will continue to manipulate their currencies in order to gain a competitive advantage, but if you are waiting for the Obama administration to truly stand up to China you are probably going to be waiting for a very, very long time.

Even Tony Robbins Is Warning That An Economic Collapse Is Coming

It seems like almost everyone is warning of a coming economic collapse these days.  Do you remember Tony Robbins?  He is probably the world’s best known “motivational speaker” and his infomercials dominated late night television during the 80s and 90s.  He was always urging all of us to “unleash the power within” and to take charge of our lives.  Well guess what?  Now Tony Robbins is warning that an economic collapse is coming. In fact, he has issued a special video warning about what he believes is about to happen. Considering the incredible connections that he has at the highest levels of the financial world, it makes a lot of sense to consider what he is trying to warn us about. Robbins says that a “major retracement” is coming to financial markets and that the coming collapse is going to be a “painful process” as we go through it.  Those familiar with Tony Robbins know that he always goes out of his way to stress the positive, so if even he is openly warning the public about a coming economic nightmare than you know that things are starting to get really, really bad out there.

The video that Tony Robbins published where he gives his economic warning is posted in two parts below.  This is unlike any Tony Robbins video that you have ever seen before and it is absolutely jaw dropping….  

Part 1:

Part 2:

So is Tony Robbins right about what is coming?

Yup.

An economic collapse is coming.

You need to get prepared.

For those not familiar with my previous articles, let’s review just some of the reasons why America is headed towards an economic nightmare of unprecedented proportions….

The National Debt – The U.S. government has accumulated a national debt that is rapidly approaching the 14 trillion dollar mark.  According to Democrat Erskine Bowles, one of the heads of Barack Obama’s national debt commission, if we continue on the path we are on the U.S. government will be spending $2 trillion just for interest on the national debt by 2020.

State And Local Debt – Many of America’s state and local governments may be in even worse financial shape than the federal government is.  In fact, some state and local governments are in such a financial mess that they have starting cutting off even the most essential services.

Consumer Debt – The total amount of consumer debt that Americans have accumulated now stands at approximately 11.7 trillion dollars. 

The Trade Deficit – The U.S. trade deficit has exploded to nightmarish proportions over the past two decades.  Every single month tens of billions more dollars flows out of the country than flows into it.  The rest of the world is literally bleeding us dry in slow motion.

No Jobs – Today it takes the average unemployed American over 8 months to find a job.  The number of Americans receiving long-term unemployment benefits has risen over 60 percent in just the past year.

The Credit Crunch – The U.S. is experiencing a credit crunch unlike anything it has seen since the Great Depression.  Lending has really, really dried up, but without loans our economic system cannot function properly.

The Housing Crisis – Even with mortgage rates at historic lows, a shockingly low number of Americans are buying houses.  There has been a total collapse in home sales since the home buyer tax credit expired.  At the same time, mortgage defaults, foreclosures and home repossessions by banks continue to set new all-time records. 

Rising Bankruptcies – Nationwide, bankruptcy filings rose 20 percent in the 12-month period ending June 30th.

Rising Poverty – One out of every eight Americans and one out of every four American children are now on food stamps.  Approximately 50 million Americans couldn’t even afford to buy enough food to stay healthy at some point last year.

The Coming Pension Crisis – America is facing a pension crisis that is so nightmarish that it is almost impossible to adequately describe it.  State and local government pension plans are woefully underfunded, dozens of large corporate pension plans either have collapsed or are on the verge of collapsing, Social Security is a complete and total financial disaster and about half of all Americans essentially have nothing saved up for retirement.

The Derivatives Bubble – Our financial system has become a gigantic gambling parlor and we have allowed a horrific derivatives bubble to develop that could destroy the entire world economy if it ever bursts.  Nobody knows exactly how big the derivatives bubble is, but low estimates place it at around 600 trillion dollars and high estimates put it at around 1.5 quadrillion dollars.  Once that bubble pops there simply will not be enough money in the entire world to fix it.

The Federal Reserve – The Federal Reserve has devalued the U.S. dollar by over 95 percent since 1913 and it has been used to create the biggest mountain of government debt in the history of the world.  There are many economists who would argue that the Federal Reserve is at the very core of our economic problems.

As we get even closer to the economic abyss that we are racing towards, even more big names such as Tony Robbins will come forward with warnings.

The truth is that these problems did not develop overnight, and they are not going to be solved overnight either. 

Perhaps our economic future is best summed up by this one statement that economist Paul Krugman recently made….

“America is now on the unlit, unpaved road to nowhere.”

It would be great if I could write about America’s bright economic future and the unlimited prosperity that is ahead for all of us, but that would be a lie.

We are headed for an economic collapse.

It is going to be painful.

It is time to get prepared.

15 Economic Statistics That Just Keep Getting Worse

A little over a week ago, U.S. Treasury Secretary Timothy Geithner penned an article for the New York Times entitled “Welcome To The Recovery” in which he touted the great strides that the U.S. economy was making.  But with unemployment still dangerously high and with foreclosures and personal bankruptcies continuing to set all-time records, should we really be talking about a “recovery”?  The truth is that the numbers don’t lie, and statistic after statistic shows that the economic fundamentals continue to get progressively worse.  The U.S. government can continue to try to pump up with economy with more debt, but the reality is that there is not going to be a legitimate “recovery” until consumer spending rebounds.  Consumer spending makes up the vast majority of U.S. GDP.  But without good jobs, consumers are not going to be able to spend money.  Unfortunately, our jobs base continues to be erode as millions upon millions of middle class jobs are shipped over to China, India and dozens of third world nations by the global predator corporations that now dominate the world economy.

The U.S. government cannot create real wealth out of thin air.  It can borrow even more money and flood the economy with even more paper currency, but the short-term “buzz” that creates does absolutely nothing to solve our long-term economic problems.

It is the private sector that actually creates wealth.  But unfortunately, over the last several decades we have allowed that wealth to become highly concentrated.  Now the giant global predator corporations have decided that American workers aren’t really that desirable after all.  They are slowly taking away their factories and their offices and they are moving them to where people are willing to work for one-tenth the pay. 

So where does that leave middle class American “consumers”?

Well, it leaves us in a world of hurt.

The following are 15 key economic statistics that just keep getting worse and which reveal the horrific economic plight in which we now find ourselves…. 

1 – The number of Americans who are receiving food stamps rose to a new all-time record of 40.8 million in May.  The number of Americans receiving food stamps has set a new all-time record for 18 months in a row.  But there is every indication that things are going to get even worse.  The U.S. Department of Agriculture projects that the number of Americans on food stamps will increase to 43 million in 2011. 

2 – The U.S. economy lost 131,000 more jobs during the month of July.  But the truth is that the U.S. economy has been bleeding jobs for a long time.  According to one analysis, the United States has lost 10.5 million jobs since 2007.  Meanwhile, immigrants (both legal and illegal) continue to pour into this nation in unprecedented numbers.

3 – Americans who are out of work are finding it incredibly difficult to get back into the workforce.  In the United States today, the average time needed to find a job has risen to an all-time record of 35.2 weeks.

4 – The U.S. government keeps trying to pump up the economy with debt, and in the process things are getting wildly out of control.  According to a U.S. Treasury Department report to Congress, the U.S. national debt will top $13.6 trillion this year and climb to an estimated $19.6 trillion by 2015.

5 – The interest on all of this debt is becoming increasingly oppressive.  As of July 1st, the U.S. government had spent $355 billion so far in 2010 on interest payments to the holders of the national debt.  The total for 2010 should be somewhere in the neighborhood of $700 billion.  According to Erskine Bowles, one of the heads of Barack Obama’s national debt commission, the U.S. government will be spending $2 trillion just on interest on the national debt by 2020.  Keep in mind that the entire U.S. government budget is less than $4 trillion for the entire year of 2010.

6 – If the U.S. government was forced to use GAAP accounting principles (like all publicly-traded corporations must), the annual U.S. government budget deficit would be somewhere in the neighborhood of $4 trillion to $5 trillion.

7 – Social Security will pay out more in benefits in 2010 than it receives in payroll taxes.  This was not supposed to happen until at least 2015.  In the years ahead, these new “Social Security deficits” are projected to be absolutely catastrophic. 

8 – There are simply far too many retirees and not nearly enough workers to support them.  Back in 1950 each retiree’s Social Security benefit was paid for by 16 workers.  Today, each retiree’s Social Security benefit is paid for by approximately 3.3 workers.  By 2025 it is projected that there will be approximately two workers for each retiree.

9 – Wealth continues to become highly concentrated at the top.  Since 1973, the average CEO’s salary has increased from 26 times the median income to over 300 times the median income.

10 – According to a poll taken in 2009, 61 percent of Americans “always or usually” live paycheck to paycheck.  That was up significantly from 49 percent in 2008 and 43 percent in 2007.

11 – The Mortgage Bankers Association recently announced that more than 10% of all U.S. homeowners with a mortgage had missed at least one mortgage payment during the January to March time period.  That was a new all-time record and represented an increase from 9.1 percent a year ago.

12 – A recent survey of last year’s college graduates found that 80 percent moved right back home with their parents after graduation.  That was up substantially from 63 percent in 2006.

13 – During the first quarter of 2010, the total number of loans that are at least three months past due in the United States increased for the 16th consecutive quarter.

14 – The total number of U.S. bank failures passed the 100 mark in July of this year.  In 2009, the total number of U.S. bank failures did not pass the century barrier until October.

15 – The U.S. dollar continues to rapidly decline in value.  An item that cost $20.00 in 1970 would cost you $112.35 today.  An item that cost $20.00 in 1913 would cost you $440.33 today.

Any rational observer (and clearly U.S. Treasury Secretary Timothy Geithner does not qualify) can see that the foundations of the U.S. economy are coming apart.  The rapidly accumulating mountain of debt that has fueled our “prosperity” is impossible to repay and is going to progressively choke the life out of our economic system.  The good jobs that we have allowed to be shipped out of our country are never coming back.  Every single day, more wealth flows out of this country than flows into it.

Anyone who claims that things are getting “better” is either ignorant, completely deluded or is purposely lying. 

The U.S. economy is not getting “better”.

The U.S. economy is dying.

You should adjust your plans accordingly.

Foreclosures Continue To Dramatically Increase In 2010

In a very alarming sign for the U.S. economy, foreclosures have continued to dramatically increase in 2010.  But there has been a shift.  Back in 2007 and 2008, experts tell us that most foreclosures were due to toxic mortgages.  People were being suckered into mortgages that they couldn’t afford with “teaser rates” or with payments that would dramatically escalate after a few years, and when those mortgages reset, the people who had agreed to them no longer could make the payments.  But now RealtyTrac says that unemployment has become the major reason for foreclosures.  Millions of Americans have become chronically unemployed during the economic downturn and many of them are losing their homes as a result.  But whatever the cause, one thing is certain – foreclosures have continued to skyrocket at a staggering rate.

According to a new report from RealtyTrac, foreclosure filings climbed in 75% of the nation’s metro areas during the first half of 2010.  At a time when the Obama administration believes that we are “turning the corner”, things just seem to get even worse. 

Some areas of the country continue to be complete and total disaster areas when it comes to real estate.  For example, you have got to feel really sorry for anyone trying to sell a house down in Florida right now.  According to RealtyTrac, Florida led the way with nine of the top 20 metro foreclosure rates in the country during the first half of 2010.

Ouch.

But the worst city for foreclosures continues to be Las Vegas.

According to RealtyTrac spokesman Rick Sharga, unemployment has replaced bad loans as the number one cause of foreclosures there….

“Las Vegas has seamlessly shifted from having a high level of foreclosures due to bad loans to defaults caused by a high level of unemployment.”

But other cities with high unemployment rates are having huge problems as well.

For those who believe that the economy is supposed to be “improving”, it must seem really odd that foreclosure rates in major cities such as Chicago continue to soar.

RealtyTrac says that foreclosure filings in Chicago have increased 23 percent year-over-year to one out of every 48 households.

But it isn’t just cities like Las Vegas and Chicago that are nightmares right now.

The truth is that this is a national crisis.

The Mortgage Bankers Association recently announced that more than 10% of all U.S. homeowners with a mortgage had missed at least one mortgage payment during the January to March time period.  That was a new all-time record and represented an increase from 9.1 percent a year ago.

Unfortunately, new all-time records are being set all over the place….

*The number of home foreclosures set a record for the second consecutive month in May.

*Banks repossessed 269,962 U.S. homes during the second quarter of 2010, which was a new all-time record.

*As of March, U.S. banks had an inventory of approximately 1.1 million foreclosed homes, which was a new record and which was up 20 percent from a year ago.

So is there any hope that things are going to get better soon?

Well, according to RealtyTrac’s CEO James Saccacio, that depends on the U.S. economy….

“The fragile stability achieved in many local housing markets hinges on improvements in the underlying economy, specifically job growth. If unemployment remains persistently high and foreclosure prevention efforts only delay the inevitable, then we could continue to see increased foreclosure activity and a corresponding weakness in home prices in many metro areas.”

Without good jobs, the American people are not going to be able to pay their mortgages.

So are the millions upon millions of jobs that have been lost coming back soon?

No, unfortunately they are not.

As we discussed at length in a previous article, the big global corporations that dominate our economy are figuring out that they don’t really need the rest of us anymore.  The American worker is becoming obsolete.  After all, why pay an American ten times as much to do the same job?  Big corporations can hire two people in China or India to do the same job and still pocket 80% of the difference.

In addition, big corporations don’t really need the headache of making employer contributions to Social Security, setting up benefit packages and pension plans or of trying to comply with the thousands upon thousands of ridiculous regulations that the U.S. government continues to spew out.

At this point, the American worker has become extremely unattractive for large corporations, and so jobs will continue to migrate to other areas of the world.

We allowed our politicians to merge us into a “global economy”, so now we are all going to have to deal with being part of a “global workforce”.

As jobs continue to be offshored and outsourced, more Americans are going to become unemployed and the foreclosure crisis is going to continue to be a nightmare.

It would be nice to put a positive spin on all of this, but there isn’t one.

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