Submitted by: Donald Hank Posted: 18 Aug 2011 06:38 PM PDT   The bad news about the economy just keeps rolling in. If this is an economic recovery, what in the world is the next "recession" going to look like? Today there was another huge truckload of bad economic news. The stock market had another 400 point "correction", applications for unemployment benefits are up again, inflation is higher than expected, home sales have dropped again and Europe is coming apart at the seams. The financial markets have been in such a state of chaos recently that days like today don't even seem "unusual" anymore. But we should all be alarmed at what is happening. We haven't seen anything quite like this since the darkest days of 2008 and 2009. If more bad news keeps pouring in, we may soon have a very real panic on our hands.I would have thought that my article yesterday, "20 Signs That The World Could Be Headed For An Economic Apocalypse In 2012", would have contained enough bad economic news to last for a while. But today there was another huge bumper crop of depressing numbers. Are you ready for the carnage? *The Dow fell 419 points today. That was a 3.7% drop. The S&P 500 shot down 4.5% and the Nasdaq plummeted by a whopping 5.2%. *European bank stocks got absolutely hammered. *The number of Americans applying for unemployment benefits jumped back above 400,000 last week. *The recent inflation numbers have really taken analysts by surprise. The consumer price index rose at a 6.0% annual rateduring the month of July. As I mentioned yesterday, the producer price index in the U.S. has increased at an annual rate of at least 7.0% for the last three months in a row. So now we have high unemployment and high inflation. Oh goody! All of this stagflation is almost enough to make one nostalgic for the 1970s. *The housing market is getting even worse. According to the National Association of Realtors, sales of previously owned homesdropped 3.5 percent during July. That was the third decline in the last four months. Sales of previously owned homes are even lagging behind last year's pathetic pace. Mortgage rates are now the lowest they have been since the 1950s, but there are very few interested buyers in the marketplace. *The Philadelphia Fed's latest survey of regional manufacturing activity was absolutely nightmarish.....
*Morgan Stanley now says that the U.S. and Europe are "hovering dangerously close to a recession" and that there is a good chance we could enter one at some point in the next 6 to 12 months. All of this bad news is sending the price of gold through the roof. The price of gold soared to a brand new all-time high of$1,829.70 an ounce on Thursday morning. So far, the price of gold is up almost 30 percent in 2011. Meanwhile, millions of average American families are deeply suffering and are desperately hoping that things won't get even worse. Everywhere you turn, there is a tremendous amount of stress in the air. According to the New York Times, 25 million Americans "could not find full-time jobs last month". As the economy crumbles, good paying full-time jobs are becoming increasingly scarce. People are hurting and they are looking for leadership. Well, Barack Obama is running around the country promising that he will unveil some "solutions" very shortly. So what are those solutions going to include? Well, the plans are still in the development stage, but the Obama administration is reportedly considering the following.... -The creation of a new government agency that will be dedicated to job creation. This will entail more government spending and more government paper pushers, but it will probably not do much to create good paying full-time jobs. -Pushing even more free trade agreements through Congress. That way even more of our good jobs can be shipped to countries on the other side of the globe where paying slave wages to workers is still legal. -A "reverse boot camp" that will train military veterans for civilian jobs. That sounds like a good idea, but we already have millions and millions of highly trained Americans that can't get jobs. -An extension of the payroll tax cut for at least another year. That will put more money into the pockets of U.S. workers, but it will also mean less revenue for the federal government. The existing payroll tax cut has not exactly resulted in a "jobs boom", but removing that tax cut is certainly not going to help the economy either. -An extension of long-term unemployment benefits.. Yes, that will help the unemployed survive and will give them some money to spend into the economy, but it will not create many jobs for them. Plus it will put the government into even more debt. -The creation of an infrastructure bank. Like most of the proposals above, this will entail even more government spending. I know that a "shovel-ready" joke is called for about now, but I can't think of one at the moment. The ironic thing is that Barack Obama is riding around on his multistate "jobs tour" in a $1.2 million bus that was made in Canada. You just can't make this stuff up. Things have gotten so bad out there that even Wal-Mart is suffering now. Sales at Wal-Mart stores that have been open for at least a year have fallen for nine quarters in a row. Not that anyone should have much sympathy for Wal-Mart, but it is a sign of just how bad things are getting out there. So is there much hope for the future? Well, considering the fact that only 32 percent of 15-year-olds in the United States are proficient in math, things don't look good. Our education system is a joke, tens of thousands of factories have already closed, more are closing every day, millions of jobs have been shipped overseas and most of our politicians are either incompetent or corrupt (or both). So you would think that with all of our problems, authorities would be focused on the big issues. But no, time after time they just keep picking on average Americans. For example, a woman that lives in the Salem, Oregon area that is fighting terminal bone cancer tried to raise some money for her medical bills by holding a few garage sales on the weekends. Well, the authorities in Salem got wind of this and now they are shutting her down. This is absolutely unbelievable. A video news report about this incident is posted below.... Massive fraud and corruption at the big banks caused a worldwide financial crisis in 2008 and yet not a single Wall Street executive has gone to prison because of it. Yet a cancer-stricken lady tries to hold a few yard sales to pay her bills and authorities come down on her like a ton of bricks. Does that seem fair to you? Our world is getting crazier every day. The bad news is going to keep pouring in. Global financial markets are being held together with chicken wire and duct tape. At some point the pyramid of corruption and con games is going to come crashing down. If you still have faith in the system, you are not very wise. We are heading for an economic collapse that will be absolutely unprecedented, and you need to be getting prepared. |
Posted: 17 Aug 2011 06:56 PM PDT   If you thought that 2011 was a bad year for the world economy, just wait until you see what happens in 2012. The U.S. and Europe are both dealing with unprecedented debt problems, the financial markets are flailing about wildly, austerity programs are being implemented all over the globe, prices on basics such as food are soaring and a lot of consumers are flat out scared right now. Many analysts now fear that a "perfect storm" could be brewing and that we could actually be headed for an economic apocalypse in 2012. Hopefully that will not happen. Hopefully our leaders can keep the global economy from completely falling apart. But right now, things don't look good. After a period of relative stability, things are starting to become unglued once again. The next major financial panic could literally happen at any time. Sadly, if we do see an economic apocalypse in 2012, it won't be the wealthy that suffer the most. It will be the poor, the unemployed, the homeless and the hungry that feel the most pain..The following are 20 signs that we could be headed for an economic apocalypse in 2012.... #1 Back in 2008 we saw major rioting around the world due to soaring food prices, and now global food prices are on the rise again. Global food prices in July were 33 percent higher than they were one year ago. Price increases for staples such as maize (up 84 percent), sugar (up 62 percent) and wheat (up 55 percent) are absolutely devastating poverty-stricken communities all over the planet. For example, one expert is warning that 800,000 children living in the Horn of Africa could die during this current famine. #2 The producer price index in the U.S. has increased at an annual rate of at least 7.0% for the last three months in a row. We are starting to see huge price increases all over the place. For example, Starbucks recently jacked up the price of a bag of coffee by 17 percent. If inflation keeps accelerating like this we could be facing some very serious problems by the time 2012 rolls around. #3 The U.S. "Misery Index" (unemployment plus inflation) recently hit a 28 year high and many believe that it is going to go much, much higher. #4 Jared Bernstein, the former chief economist for Vice President Joe Biden, says that the unemployment rate in this countrywill not go below 8% before the 2012 election. In fact, Bernstein says that "the most optimistic forecast would be for about eight-and-a-half percent." #5 Working class jobs in the United States continue to disappear at an alarming rate. Back in 1967, 97 percent of men with a high school degree between the ages of 30 and 50 had jobs. Today, that figure is 76 percent. #6 There are all kinds of indications that U.S. economic growth is about to slow down even further. For example, pre-orders for Christmas toys from China are way down this year. #7 One recent survey found that 9 out of 10 U.S. workers do not expect their wages to keep up with the rising cost of basics such as food and gasoline over the next year. #8 U.S. consumer confidence is now at its lowest level in 30 years. #9 Today, an all-time record 45.8 million Americans are on food stamps. It is almost inconceivable that the largest economy on earth could have so many people dependent on the government for food. #10 As the economy crumbles, we are also witnessing the fabric of society beginning to come apart. The recent flash mobcrimes that we are starting to see all over America are just one example of this. #11 Some desperate Americans are already stealing anything that they can get their hands on. For example, according to the American Kennel Club, dog thefts are up 32 percent this year. #12 Small businesses all over the United States are having a really difficult time getting loans right now. Perhaps if the Federal Reserve was not paying banks not to make loans things would be different. #13 The U.S. national debt is like a giant boulder that our economy must constantly carry around on its back, and it is growing by billions of dollars every single day. Right now the debt of the federal government is $14,592,242,215,641.90. It has gone up by nearly 4 trillion dollars since Barack Obama took office. S&P has already stripped the U.S. of its AAA credit rating, and more downgrades are certain to come if the U.S. does not get its act together. #14 Tensions between the United States and China are rising again. A new opinion piece on chinadaily.com is calling for the Chinese government to use its holdings of U.S. debt as a "financial weapon" against the United States if the U.S. follows through with a plan to sell more arms to Taiwan. The U.S. and China are the two biggest economies in the world, so any trouble between them would mean economic trouble for the rest of the globe as well. #15 Most state and local governments in the U.S. are deep in debt and flat broke. Many of them are slashing jobs at a feverish pace. According to the Center on Budget and Policy Priorities, state and local governments have eliminated more than half a million jobs since August 2008. UBS Investment Research is projecting that state and local governments in the U.S. will cut450,000 more jobs by the end of 2012. How those jobs will be replaced is anyone's guess. #16 The U.S. dollar continues to get weaker and weaker. This is renewing calls for a new global currency to be created to replace the U.S. dollar as the reserve currency of the world. #17 The European sovereign debt crisis continues to get worse. Countries like Portugal, Italy and Greece are on the verge of an economic apocalypse. All of the financial problems in Europe are even beginning to affect the core European nations. For example, German industrial production declined by 1.1% in June. There are all kinds of signs that the economy of Europe is slowing down and is heading for a recession. French President Nicolas Sarkozy and German Chancellor Angela Merkel are proposing that a new "economic government" for Europe be set up to oversee this debt crisis, but nothing that the Europeans have tried so far has done much to solve things. #18 The Federal Reserve is so desperate to bring some sort of stability to financial markets that it has stated that it will likelykeep interest rates near zero all the way until mid-2013. The Federal Reserve is operating in "panic mode" almost constantly now and they are almost out of ammunition. So what is going to happen when the real trouble starts? #19 Central banks around the world certainly seem to be preparing for something. According to the World Gold Council, central banks around the globe purchased more gold during the first half of 2011 than they did all of last year. #20 Often perception very much influences reality. One recent survey found that 48 percent of Americans believe that it is likely that another great Depression will begin within the next 12 months. If people expect that a depression is coming and they quit spending money that actually increases the chance that an economic downturn will occur. There is already a tremendous amount of economic pain on the streets of America, but unfortunately it looks like things may get even worse in 2012. The once great economic machine that was handed down to us by our forefathers is falling to pieces all around us and we are in debt up to our eyeballs. The consequences of our bad economic decisions are hurting some of the most vulnerable members of our society the most. As the following video shows, large numbers of formerly middle class Americans are now living in their cars or sleeping in the streets.... It is a crying shame what is happening out there on the streets of America today. Please say a prayer for all of those that are sleeping in cars or tents or under bridges tonight. Soon even more Americans will be joining them. |
Posted: 16 Aug 2011 06:19 PM PDT   In the United States today, we are being taxed into oblivion, yet it is being done so stealthily that most Americans don't even realize what is happening. Most people are fixated on federal income tax rates, but the federal income tax is only one of the dozens of different taxes that each of us pay each year.. The politicians have learned that people get really upset when income tax rates are raised, so they have found hundreds of other ways to raise taxes on us. What most taxpayers in the United States today are facing is "death by a thousand cuts". When you add up all forms of taxation from all levels of government, approximately 40 percent of all the income in the country is taken in as taxes by government. Large numbers of Americans end up paying well over 50 percent of their income in taxes, and many of them don't even realize that it is happening. We truly are being taxed into oblivion, and yet the politicians just keep coming back for more.On all levels, government just keeps growing, and all of this government has got to be paid for somehow. Politicians have become masters at finding ways to tax us so that we won't even feel it. They have an endless hunger to spend more money, and they depend on us to feed that addiction. Today, the combination of federal government spending, state government spending and local government spending now accounts for a larger share of U.S. GDP than at any other time in our history. Yes, federal income tax rates were significantly higher 30 or 40 years ago. But virtually every other tax you can think of has gone way up since then or did not exist back then. Federal income taxes definitely still hurt, but the reality is that where we really get hit is in all of the other taxes that we pay. American families pay Social Security taxes, Medicare taxes, state income taxes, sales taxes, property taxes, death taxes, various excise taxes, gasoline taxes, tire taxes, utility taxes, liquor taxes, telephone taxes and cigarette taxes just to name a few. The truth is that there are dozens and dozens of different taxes that most Americans pay each year, and there are a whole bunch of others that get passed on to us through businesses that we deal with. Speaking of cigarette taxes, there is legislation in Congress right now that would send taxes on tobacco products absolutely skyrocketing yet again.. I don't smoke and I never will smoke, but I find the attack on smokers by our politicians to be seriously offensive. If smoking is legal, then leave them alone. Don't tax them into oblivion just because you don't like what they are doing. An excerpt from S. 1403 (The IDEA Full Funding Act) is posted below. You will notice that a portion of this legislation even refers to itself as the "Saving Lives by Lowering Tobacco Use Act". They are openly admitting that they want to make tobacco so expensive that people cannot afford to use it....
You can view the full text of this legislation right here. Please notice that some of the tax increases are absolutely mind blowing. For example, the tax rate on pipe tobacco is going from 2.8311 cents to $49.55. Now that is a tax increase you can really sink your teeth into. We are seeing "quiet" tax increases like this happen on every level of government all over the United States. Of course I haven't even mentioned all of the fines and fees and "registration" charges that state and local governments are hitting us with. Have you gone to renew your car registration lately? In some states (such as California) the fees have gotten absolutely ridiculous. Speaking of California, it looks like they are getting ready to target cellphone users once again. According to USA Today, California is getting ready to seriously jack up the fines for talking on a cellphone while driving....
Yes, talking on a cellphone while driving is dangerous. But hitting people with tickets of $300, $400 or even $500 is not about safety. It is all about revenue generation. Right now we are seeing an epidemic of speed traps all over the country. State and local governments are desperate for money, and they see speeders as an easy source of revenue. You can read more about this phenomenon right here. Speaking of "revenue", that seems to have become Barack Obama's new favorite word lately. He seems absolutely obsessed with raising more money for the federal government. The Obamacare law was absolutely packed to the gills with new taxes, but now he wants even more. Yes, it is true that the wealthy are getting away with murder under our current tax system. I find it highly offensive that many people that make millions of dollars each year are able to find ways to pay much, much smaller percentages of their incomes in taxes than I do. But raising tax rates isn't going to solve the problem. Those that are masters at avoiding taxes are going to continue to do so. Meanwhile, middle class Americans and small businesses will continue to get bled to death. Our current tax system is fundamentally broken and needs to be completely thrown out and replaced. However, no system is going to work until the federal government gets a handle on its spending addiction. In the past couple of years, spending by the federal government as a share of GDP has been the highest that it has been since World War II. You would think that there should be plenty of fat to trim, but as the recent debt ceiling deal clearly demonstrated, our politicians do not intend to significantly reduce government spending. They are just going to keep borrowing, spending and finding more ways to tax us. All of this nonsense in Washington D.C. is part of the reason why Americans are so displeased with Congress at this point. According to Gallup, 84 percent of Americans now disapprove of the way Congress is doing its job, which is a brand new all-time high. The truth is that sending more money to Washington D.C. is not going to "fix" things. The federal government has multiplied in size over the past several decades, and yet the number of poor people just continues to increase. Giving the poor more handouts may ease their suffering for a little while, but it is not the solution to their problems. What they really need are good jobs, but our politicians have very busy setting up unfair trade agreements that allow millions of our jobs to be shipped overseas, and they continue to suffocate businesses in this country with mountains of ridiculous regulations. No, the people that truly benefit when more money flows to the federal government are the fatcats that live and work around Washington D.C. The past few decades have been a bonanza for government contractors, lobbyists and lawyers in the D.C. area. According to the Washington Post, those living in the Washington D.C. metropolitan area now have a higher median household income than anyone else in the country....
There is a ton of money in the D.C. area. I know. I used to work there. Approximately one third of the GDP of the region comes from spending by the federal government. Even during this recent economic downturn, the Washington D.C. region continues to do really, really well.. So, no, raising taxes is not going to fix what ails us. It would just feed the monster that we have created in Washington. We are already being taxed into oblivion. Middle class America can't take much more of this. We need to change our entire approach to taxation in this country, because right now our tax system is fundamentally unfair and it is not working. |
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