Tag Archives: Michael T. Snyder

The US economy is doing fine and recovering nicely? Then how do you explain these facts?

No, the economy is most definitely not “recovering”.  Despite what you may hear from the politicians and from the mainstream media, the truth is that the U.S. economy is in far worse shape than it was prior to the last recession.

We are still pretty much where we were when the last recession finally ended.  When the financial crisis of 2008 struck, it took us down to a much lower level economically.  Thankfully, things have at least stabilized at this much lower level.  For example, the percentage of working age Americans that are employed has stayed  remarkably flat for the past four years.  We should be grateful that things have not continued to get even worse.  It is almost as if someone has hit the “pause button” on the U.S. economy.  But things are definitely not getting better, and there are a whole host of signs that this bubble of false stability will soon come to an end and that our economic decline will accelerate once again.  The following are 17 facts that prove the U.S. economy is absolutely NOT just fine…

#1  The homeownership rate in the United States has dropped to the lowest level in 19 years.

#2  Consumer spending for durable goods has dropped by 3.23 percent since November.  This is a clear sign that an economic slowdown is ahead.

#3  Major retailers are closing stores at the fastest pace that we have seen since the collapse of Lehman Brothers.

#4  According to the Bureau of Labor Statistics, 20 percent of all families in the United States do not have a single member that is employed.  That means that one out of every five families in the entire country is completely unemployed.

#5  There are 1.3 million fewer jobs in the U.S. economy than when the last recession began in December 2007.  Meanwhile, our population has continued to grow steadily since that time.

#6  According to a new report from the National Employment Law Project, the quality of the jobs that have been “created” since the end of the last recession does not match the quality of the jobs lost during the last recession…

  • Lower-wage industries constituted 22 percent of recession losses, but 44 percent of recovery growth.
  • Mid-wage industries constituted 37 percent of recession losses, but only 26 percent of recovery growth.
  • Higher-wage industries constituted 41 percent of recession losses, and 30 percent of recovery growth.

#7  After adjusting for inflation, men who work full-time in America today make less money than men who worked full-time in America 40 years ago.

#8  It is hard to believe, but 62 percent of all Americans make $20 or less an hour.

#9  Nine of the top ten occupations in the U.S. pay an average wage of less than $35,000 a year.

#10  The middle class in Canada now makes more money than the middle class in the United States does.

#11  According to one recent study, 40 percent of all Americans could not come up with $2000 right now even if there was a major emergency.

#12  Less than one out of every four Americans has enough money put away to cover six months of expenses if there was a job loss or major emergency.

#13  An astounding 56 percent of all Americans have subprime credit in 2014.

#14  As I stated recently, there are now 49 million Americans dealing with food insecurity.

#15  Ten years ago, the number of women in the U.S. that had jobs outnumbered the number of women in the U.S. on food stamps by more than a 2 to 1 margin.  But now the number of women in the U.S. on food stamps actually exceeds the number of women that have jobs.

#16  69 percent of the federal budget is spent either on entitlements or on welfare programs.

#17  The number of Americans receiving benefits from the federal government each month exceeds the number of full-time workers in the private sector by more than 60 million.

Taken individually, those numbers are quite remarkable. Taken collectively, they are absolutely breathtaking. Yes, things have been improving for the wealthy for the last several years.  The stock market has soared to new record highs and real estate prices in the Hamptons have skyrocketed to unprecedented heights.

But that is not the real economy.  In the real economy, the middle class is being squeezed out of existence.  The quality of our jobs is declining and prices just keep rising.  This reality was reflected quite well in a comment that one of my readers left on one of my recent articles

It is getting worse each passing month. The food bank I help out, has barely squeaked by the last 3 months. Donors are having to pull back, to take care of their own families. Wages down, prices up, simple math tells you we can not hold out much longer. Things are going up so fast, you have to adopt a new way of thinking. Example I just had to put new tires on my truck. Normally I would have tried to get by to next winter. But with the way prices are moving, I decide to get them while I could still afford them. It is the same way with food. I see nothing that will stop the upward trend for quite a while. So if you have a little money, and the space, buy it while you can afford it. And never forget, there will be some people worse off than you. Help them if you can.

And the false stock bubble that the wealthy are enjoying right now will not last much longer.  It is an artificial bubble that has been pumped up by unprecedented money printing by the Federal Reserve, and like all bubbles the Fed creates, it will eventually burst.

None of the long-term trends that are systematically destroying our economy have been addressed, and none of our major economic problems have been fixed.  In fact, as I showed in this recent article, we are actually in far worse shape than we were just prior to the last major financial crisis.

Let us hope that this current bubble of false stability lasts for as long as possible. But let us not be deceived into thinking that it is permanent.

[by Michael Snyder, writing for THE ECONOMIC COLLAPSE Blog]

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As always, posted for your edification and enlightenment by

NORM ‘n’ AL, Minneapolis
normal@usa1usa.com
612.239.0970

 

 

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The American middle class is slowly disappearing. Where is it going? Downhill, to join the poverty-stricken…

Family Dollar is closing 370 stores Family Dollar closing stores When I learned of this, I was quite stunned. I knew that retailers that serve the middle class were really struggling right now, but I had no idea that things had gotten so bad for low end stores like Family Dollar. In the post-2008 era, dollar stores had generally been one of the few bright spots in the retail industry. As millions of Americans fell out of the middle class, they were looking to stretch their family budgets as far as possible, and dollar stores helped them do that. It would be great if we could say that the reason why Family Dollar is doing so poorly is because average Americans have more money now and have resumed shopping at retailers that target the middle class, but that is not happening. Rather, as you will see later in this article, things just continue to get even worse for Americans at the low end of the income scale. I was also surprised to learn that Coldwater Creek is closing all of their stores

Women’s clothing retailer Coldwater Creek Inc. on Friday filed for Chapter 11 bankruptcy after failing to find a buyer said it plans to close its stores by early summer. Coldwater Creek joins other retailers to seek protection from creditors in recent months as consumers keep a lid on spending. The company said it plans to wind down its operations over the coming months and begin going-out-of-business sales in early May, before the traditionally busy Mother’s Day weekend. Coldwater Creek, which has 365 stores and employs about 6,000 people, has five stores in Maryland.

I remember browsing through a Coldwater Creek with my wife and mother-in-law just last year. At the time, my mother-in-law was excited about getting one of their catalogs. But now Coldwater Creek is going out of business, and all that will be left of that store is a big, ugly, empty space. Of course the fact that a couple of major retailers are closing stores is nothing new. This kind of thing happens year after year. But what we are witnessing right now is really quite startling. So many retailers are closing so many stores that it is being called a “retail apocalypse”. In a previous article entitled “This Is What Employment In America Really Looks Like…“, I detailed how major U.S. retailers have already announced the closing of thousands of stores so far this year.  If the economy really was “getting better”, this should not be happening. So why are so many stores closing? Well, the truth is that it is because the middle class is dying. With each passing day, more Americans lose their place in the middle class and fall into poverty. The following is an excerpt from the story of one man that this has happened to. His recent piece in the Huffington Post was entitled “Next Friday, I’ll Be Living In My Car“…

For the past 13 years, I’ve mostly been doing facility management in several locations across the state. After the position turned into more of a sales role, they laid me off. Since then, I’ve been looking to find any type of work. I’ve applied for food stamps, and I’m waiting for that. I’m mostly eating soup from a food pantry. I’ve been on several interviews — second, third, fourth interviews — and just haven’t been able to land a job for whatever reason. I definitely have the qualifications and the experience. Last week, I had a job offer that I thought was secure, and we were talking my work schedule. They decided to call me back and go with an assistant rather than a manager. For a number of applications, I’ve dumbed down my resume. I don’t even go with a resume sometimes, just because I don’t want them to know that I’m educated and have a master’s degree. It shoots me in the foot. They don’t want me because they don’t think I’m going to stay. I don’t blame them.I was making six figures at $60-70 an hour. Now, I’m looking for a $10 an hour job.

There are millions upon millions of Americans that can identify with what that man is going through. Once upon a time, they were living comfortable middle class lifestyles, but now they will take any jobs that they can get. Just today I came across a statistic that shows the massive shift that is happening in this country. A decade ago, the number of women working outnumbered the number of women on food stamps by more than a 2 to 1 margin. But now the number of women on food stamps actually exceeds the number of women that have jobs. Wow. How could things have changed so rapidly over the course of just one decade? And sadly, things continue to go downhill. Every day in America, more good jobs are being sent out of the country or are being replaced by technology. I really like how James Altucher described this trend the other day…

Technology, outsourcing, a growing temp staffing industry, productivity efficiencies, have all replaced the middle class. The working class. Most jobs that existed 20 years ago aren’t needed now. Maybe they never were needed. The entire first decade of this century was spent with CEOs in their Park Avenue clubs crying through their cigars, “how are we going to fire all this dead weight?”. 2008 finally gave them the chance. “It was the economy!” they said. The country has been out of a recession since 2009. Four years now. But the jobs have not come back. I asked many of these CEOs: did you just use that as an excuse to fire people, and they would wink and say, “let’s just leave it at that.” I’m on the board of directors of a temp staffing company with one billion dollars in revenues. I can see it happening across every sector of the economy. Everyone is getting fired. Everyone is toilet paper now. Flush.

There is so little loyalty in corporate America these days. If you work for a major corporation, you could literally lose your job at any moment. And you can be sure that there is someone above you that is trying to figure out a way to accomplish the tasks that you currently perform much more cheaply and much more efficiently. Most big corporations don’t care if you are personally successful or if you are able to take care of your family. What they want is to get as much out of you as possible for as little money as possible. This is a big reason why 62 percent of all Americans make $20 or less an hour at this point. The quality of our jobs is going down, but the cost of living just keeps going up. Just look at what is happening to food prices. For a detailed examination of this, please see my previous article entitled “Why Meat Prices Are Going To Continue Soaring For The Foreseeable Future“. As the middle class slowly dies, less people are able to afford to buy homes. Mortgage originations at major U.S. banks have fallen to a record low, and the percentage of Americans that live in “high-poverty neighborhoods” is rising rapidly

An estimated 12.4 million Americans live in economically devastated neighborhoods, according to American Community Survey data collected from 2008 to 2012. That’s an 11 percent jump from the previous survey, conducted from 2007 to 2011. Even more startling, it’s a 72 percent increase in the population of high-poverty neighborhoods since the 2000 Census.

If nothing is done about the long-term trends that are slowly strangling the middle class to death, all of this will just be the beginning. We will see millions more Americans lose their jobs, millions more Americans lose their homes and millions more Americans living in poverty. The United States is being fundamentally transformed, and very few people are doing much of anything to stand in the way of this transformation. Decades of incredibly foolish decisions are starting to catch up with us, and unless something dramatic is done right away, all of these problems will soon get much, much worse.

[by Michael Snyder, writing for THE ECONOMIC COLLAPSE blog]

 

NORM ‘n’ AL Note: Be sure to see our next blog article, too, for more facts on the same subject.

 

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As always, posted for your edification and enlightenment by

NORM ‘n’ AL, Minneapolis
normal@usa1usa.com
612.239.0970

 

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Alarming new report from the US Dept. of Agriculture: 31 percent of food in the USA is wasted…

According to a stunning new report from the U.S. Department of Agriculture, nearly a third of all food produced in the United States gets wasted.

How does 31 percent of our food get wasted?

We are probably the most wasteful society in the history of the planet, and we are also one of the most gluttonous.  More than 35 percent of all Americans are considered to be officially “obese” by the Centers for Disease Control and Prevention.  Unfortunately, this era of gluttony and taking food for granted will soon be coming to an end.  Thanks to crippling drought in key growing areas and other extremely bizarre weather patterns, a massive food crisis is beginning to emerge all over the planet.  If you don’t think that this is going to affect you, then you simply are not paying attention. Approximately half of all produce grown in the United States comes from the state of California, and right now California is suffering through the worst stretch of drought on record.  Food prices are going to start soaring, and that is going to affect the household budget of every family in America.

Needless to say, a time is coming when Americans will not waste food so recklessly.  But for the moment, we still have a tremendous amount of disrespect for the value of food.  According to the U.S. Department of Agriculture, we waste a staggering 133 billion pounds of food each year

Nearly a third of the 430 billion pounds of food produced for Americans to eat is wasted, a potential catastrophe for landfills and a wake-up call to officials scrambling to feed the hungry, according to a stunning new report from the Department of Agriculture.

The just-issued report revealed that in 2010, 31 percent, or 133 billion pounds, of food produced for Americans to eat was wasted, either molded or improperly cooked, suffered “natural shrinkage” due to moisture loss, or because people became disinterested in what they purchased.

Not that we need to stuff any more food into our mouths.  As I mentioned above, we have an epidemic of obesity in this nation.  In fact, the CDC says that 35 percent of the entire population is “obese”…

Meanwhile, according to the Centers for Disease Control and Prevention, more than one-third of US adults (35.7 percent) are obese, which is perhaps the best argument that Americans can offset a large part of the food waste problem by simply eating less. The estimated annual medical cost of obesity in the US was $147 billion in 2008; the costs of providing medical assistance for individuals who are obese were $1,429 higher than those of normal weight, thereby placing an enormous strain on healthcare costs.

Since we are such gluttons and we are so incredibly wasteful, we should have plenty of food to share with those in need, right?

Unfortunately, we are also extremely greedy and greatly lacking in compassion.

As I have written about previously, feeding the homeless has been banned in cities all over the nation, and other cities have passed regulations that greatly discourage the feeding of the homeless

Feeding the homeless is about to get harder as a new policy is set to begin this Saturday, Feb. 15, in Columbia, SC. Charities and non-profits will be required to pay a fee and obtain a permit 15 days in advance in order to feed the homeless in parks.

One impacted charity that was interviewed by the Free Times, Food Not Bombs, has been serving food to the homeless in Finlay Park every Sunday for 12 years. The group’s organizer, Judith Turnipseed, noted that the group has an impeccable track record and always tidies up after the meal. But with the new crackdown, Food Not Bombs will have to pay at least $120 per week for the right to feed the homeless.

Since the Columbia City Council approved its exile plan in August, the city has been trying to herd its homeless people to a shelter on the outskirts of town and keep them away from downtown. If charities continue to provide food in downtown parks, the thinking goes, it will allow homeless people to continue to live downtown, rather than being forced to leave.

What is wrong with us?

While we stuff our faces with more french fries and chicken wings, we have an appalling lack of compassion for those that are not able to take care of themselves.

Nearly a third of this food will be wasted...

Perhaps we deserve what is coming.

The horrible drought that never seems to end is rapidly turning much of the western half of the country into a barren wasteland.

You can see some incredible before and after photos of the drought in California right here.

If a miracle does not happen, the upcoming growing season is going to be absolutely disastrous.  As I have written about previously, California farmers have already decided to allow half a million acres of farmland to sit idle this year because of the extremely dry conditions.

And it certainly does not help that the government has decided to cut off water supplies to many of the farmers.  The following is an excerpt from a recent article by Holly Deyo

Government has lost its mind. It is no more evident than their decision last week to cut off water to America’s food basket. Squeezed by the worst-ever drought in the state’s history, California is dying of thirst. Crushing news was delivered to farmer’s thatno water would be coming from the Federal government. This dreaded decision was compounded by the Sierra Mountains getting just 25% of normal snowpack. There is no water to replenish already dangerously low reservoirs, so no water for farmers.

Needless to say, there are a lot of farmers that are going to be absolutely crippled by this.  The following is from Fox News

A federal agency’s recent announcement that the California’s Central Valley will get zero percent water allocation this year was devastating for farmers already dealing with the worst drought seen in decades.

One of the world’s most productive agricultural regions, the enormous valley is reeling after the driest year in more than a century. But last week, the Department of Interior’s Bureau of Reclamation, which supplies water to a third of the irrigated farmland in California through a 500-mile network of canals and tunnel, said it won’t be able to deliver any of the water sought by farmers.

“It goes beyond devastation, you’re going to see farms that have been in business 30 and 40 years, they do not have any water, they are out of business,” said Dennis Falaschi, general manager of the Panoche Water District.

If California produces much less food than it normally does, that means that food prices are going to start skyrocketing.  Here is more from Holly Deyo

As one Millennium-Ark reader pointed out in an email last week, after the jump in beef prices, people will look to chicken, pork, fish and turkey. Chicken is already up though not as much as beef.  This will, in turn, drive up their costs and affect availability of these other meats. Keep in mind that California also produces all of these proteins plus lamb. Then consider this: Ag Specialists Warn of Higher Wheat Prices Due to Drought. It’s not just beef, weather is clobbering food from all angles.

And please keep in mind that the total size of the U.S. cattle herd has already been shrinking for seven years in a row, and that it is now the smallest that it has been since 1951.

But back in 1951, the size of the U.S. population was less than half of what it is today.

For much more on the emerging food crisis, please see this video.

Let us certainly hope and pray that the drought in California ends soon and that things get back to normal.

But I wouldn’t count on that.

According to National Geographic, the scientific experts that have studied these things tell us that it has been quite common throughout history for that region of North America to suffer through extended droughts that last for a decade or more.

One drought even lasted for about 200 years.

So the current drought in California might end next year. Or it might last for the rest of our lifetimes. We simply do not know.

But what does seem clear is that the days of taking our food for granted will soon be coming to an end.

[by Michael Snyder, writing for ECONOMIC COLLAPSE]

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As always, posted for your edification and enlightenment by

NORM ‘n’ AL, Minneapolis
normal@usa1usa.com
612.239.0970

 

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China now making a power move against the US dollar…

In order for our current level of debt-fueled prosperity to continue, the rest of the world must continue to use our dollars to trade with one another and must continue to buy our debt at ridiculously low interest rates.  Of course the number one foreign nation that we depend on to participate in our system is China.  China accounts for more global trade than anyone else on the planet(including the United States), and most of that trade is conducted in U.S. dollars.  This keeps demand for our dollars very high, and it ensures that we can import massive quantities of goods from overseas at very low cost.  As a major exporting nation, China ends up with gigantic piles of our dollars.  They lend many of those dollars back to us at ridiculously low interest rates.  At this point, China owns more of our national debt than any other country does.  But if China was to decide to quit playing our game and started moving away from U.S. dollars and U.S. debt, our economic prosperity could disappear very rapidly.  Demand for the U.S. dollar would fall and prices would go up.  And interest rates on our debt and everything else in our financial system would go up to crippling levels.  So it is absolutely critical to our financial future that China continues to play our game.

Unfortunately, there are signs that China has now decided to start looking for a smooth exit from the game.  In November, I wrote about how the central bank of China has announced that it is “no longer in China’s favor to accumulate foreign-exchange reserves”.  That means that the pile of U.S. dollars that China is sitting on is not going to get any higher.

In addition, China has signed a whole host of international currency agreements with other nations during the past couple of years which are going to result in less U.S. dollars being used in international trade.  You can read about many of these agreements in this article.

This week, we learned that China started to dump U.S. debt during the month of December.  Many have imagined that China would try to dump a flood of our debt on to the market all of a sudden once they decided to exit, but that simply does not make sense.  Instead, it makes sense for China to dump a bit of debt at a time so that the market will not panic and so that they can get close to full value for the paper that they are holding.

As Bloomberg reported the other day, China dumped nearly 50 billion dollars of U.S. debt during the month of December…

China, the largest foreign U.S. creditor, reduced holdings of U.S. Treasury debt in December by the most in two years as the Federal Reserve announced plans to slow asset purchases.

The nation pared its position in U.S. government bonds by $47.8 billion, or 3.6 percent, to $1.27 trillion, the largest decline since December 2011, according to U.S. Treasury Department data released yesterday.

This is how I would do it if I was China.  I would try to dump 30, 40 or 50 billion dollars a month.  I would try to make a smooth exit and try to get as much for my U.S. debt paper as I could.

So if China is not going to stockpile U.S. dollars or U.S. debt any longer, what is it going to stockpile?

It is going to stockpile gold of course.  In fact, China has been voraciously stockpiling gold for quite some time, and their hunger for gold appears to be growing.

According to Bloomberg, more than 80 percent of the gold that was exported from Switzerland last month went to Asia…

Switzerland sent more than 80 percent of its gold and silver bullion and coin exports to Asia last month, the Swiss Federal Customs Administration said today in an e-mailed report. It imported most from the U.K.

Hong Kong was the top destination at 44 percent on a value basis, with India at 14 percent, the Bern-based customs agency said in its first breakdown of the gold trade data since 1980. Singapore accounted for 8.6 percent of exports, the United Arab Emirates 7.9 percent and China 6.3 percent.

When China imports gold, most of it goes through Hong Kong.  We know that imports of gold from Hong Kong into China are at an all-time record high, but we don’t know exactly how much gold China has accumulated at this point because they quit reporting that to the rest of the world a number of years ago.

When it comes to global finance, China is playing chess and the United States is playing checkers.  China knows that gold is a universal currency that will hold value over the long-term.  As the paper currencies of the world race toward collapse, China could end up holding most of the real money and that would be a huge game changer when they finally reveal that fact…

The announcement of China’s new gold hoard will send shockwaves through the financial markets, and make China and the Chinese yuan (their national currency) even bigger players at the international table.

International banking expert James Rickards compared it to a game of Texas Hold ‘Em poker:

“You want a big pile of chips. The U.S. has a big pile of chips, Europe has a big pile of chips. The U.S. has 8,000 tonnes [metric tons] of gold, 17 members of the euro system have 10,000 tonnes. China at 1,000 tonnes is not a player, but at 5,000 tonnes, they are a player.”

There are some really good points made in the quote above, but I do take exception with a couple of things.  First of all, I believe that China now has far more than 5,000 tons of gold.  Secondly, I seriously doubt that the U.S. still actually has 8,000 tons of gold or that Europe still actually has 10,000 tons of gold.

As China (and eventually the rest of the world) moves away from a U.S.-based financial system, the consequences are going to be dramatic.

For instance, right now the average rate of interest that the U.S. government pays on debt is just 2.477 percent.  That is ridiculously low and it is way below the real rate of inflation.  It is simply not rational for anyone to lend the U.S. government money so cheaply, and at some point we are going to see a dramatic shift.

When that day arrives, interest rates are going to rise dramatically.  And if the average rate of interest on U.S. government debt rises to just 6 percent (and it has been much higher than that in the past), we will be paying out more than a trillion dollars a year just in interest on the national debt.

Even more frightening is what a rapidly changing interest rate environment would mean for our banking system.  There are four large U.S. banks that each have exposure to derivatives in excess of 40trillion dollars.  You can find the identity of those banks right here.  Interest rate derivatives make up the biggest chunk of those derivatives contracts.  As John Embry told King World News just the other day, when that bubble bursts the carnage is going to be unprecedented…

“Stockman brought up a brilliant point, the fact that we have hundreds of trillions of dollars of interest rate swaps, which are polluting the world’s banking system. If we see growing volatility in interest rates, and I think that’s inevitable with what’s going on, that would cause spasms in the financial system. And if something goes wrong in the derivatives market, Heaven help us because the leverage that is imparted to the banking system through these derivatives is unholy.”

Unfortunately, very few of the “experts” will ever see this crash coming.

Very few of them saw it coming in 2000.

Very few of them saw it coming in 2008.

And very few of them will see it coming this time.

I really like what Paul B. Farrell had to say about this…

Early warnings of a crash are dismissed over and over (“just a temporary correction”). They gradually numb us about the inevitable. Time after time we forget history’s lessons. Until finally a big surprise catches us totally off-guard. Financial historian Niall Ferguson put it this way: Before the crash, our world seems almost stationary, deceptively so, balanced, at a set point. So that when the crash finally hits — as inevitably it will — everyone seems surprised. And our brains keep telling us it’s not time for a crash.

Till then, life just goes along quietly, hypnotizing us, making us vulnerable, till a shocker like Lehman Brothers upsets the balance. Then, says Ferguson, the crash is “accelerating suddenly, like a sports car … like a thief in the night.” It hits. Shocks us wide awake.

Don’t let the upcoming crash take you by surprise.

The warning signs are very clear.

Get ready while you still can.

[by Michael Snyder, writing for The Economic Collapse blog]

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As always, posted for your edification and enlightenment by

NORM ‘n’ AL, Minneapolis
normal@usa1usa.com
612.239.0970

 

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The fire of global economic crisis is beginning to heat up…

These are the signs that problems lie ahead:

If you have been waiting for the “global economic crisis” to begin, just open up your eyes and look around.  Most Americans tend to ignore what happens in the rest of the world because they consider it to be “irrelevant” to their daily lives, but the truth is that the massive economic problems that are currently sweeping across Europe, Asia and South America are going to be affecting all of us here in the U.S. very soon.  Sadly, most of the big news organizations in this country seem to be more concerned about the fate of Justin Bieber’s wax statue in Times Square than about the horrible financial nightmare that is gripping emerging markets all over the planet.  After a brief period of relative calm, we are beginning to see signs of global financial instability that are unlike anything that we have witnessed since the financial crisis of 2008.  As you will see below, the problems are not just isolated to a few countries.  This is truly a global phenomenon.

Global crisis beginning to heat up...

Over the past few years, the Federal Reserve and other global central banks have inflated an unprecedented financial bubble with their reckless money printing.  Much of this “hot money” poured into emerging markets all over the world.  But now that the Federal Reserve has begun “tapering” quantitative easing, investors are taking this as a sign that the party is ending.  Money is being pulled out of emerging markets all over the globe at a staggering pace and this is creating a tremendous amount of financial instability.  In addition, the economic problems that have been steadily growing over the past few years in established economies throughout Europe and Asia just continue to escalate.  The following are 20 signs that the global economic crisis is starting to catch fire…

#1 The unemployment rate in Greece has hit a brand new record high of 28 percent.

#2 The youth unemployment rate in Greece has hit a brand new record high of 64.1 percent.

#3 The percentage of bad loans in Italy is at an all-time record high.

#4 Italian industrial output declined again in December, and the Italian government is on the verge of collapse.

#5 The number of jobseekers in France has risen for 30 of the last 32 months, and at this point it has climbed to a new all-time record high.

#6 The total number of business failures in France in 2013 was even higher than in any year during the last financial crisis.

#7 It is being projected that housing prices in Spain will fall another 10 to 15 percent as their economic depression deepens.

#8 The economic and political turmoil in Turkey is spinning out of control.  The government has resorted to blasting protesters with pepper spray and water cannons in a desperate attempt to restore order.

#9 It is being estimated that the inflation rate in Argentina is now over 40 percent, and the peso isabsolutely collapsing.

#10 Gangs of armed bandits are roaming the streets in Venezuela as the economic chaos in that troubled nation continues to escalate.

#11 China appears to be very serious about deleveraging.  The deflationary effects of this are going to be felt all over the planet. The following is an excerpt from Ambrose Evans-Pritchard’s recent article entitled “World asleep as China tightens deflationary vice“…

China’s Xi Jinping has cast the die. After weighing up the unappetising choice before him for a year, he has picked the lesser of two poisons.

The balance of evidence is that most powerful Chinese leader since Mao Zedong aims to prick China’s $24 trillion credit bubble early in his 10-year term, rather than putting off the day of reckoning for yet another cycle.

This may be well-advised for China, but the rest of the world seems remarkably nonchalant over the implications.

#12 There was a significant debt default by a coal company in China last Friday

A high-yield investment product backed by a loan to a debt-ridden coal company failed to repay investors when it matured last Friday, state media reported on Wednesday, in the latest sign of financial stress in China’s shadow bank sector.

#13 Japan’s Nikkei stock index has already fallen by 14 percent so far in 2014.  That is a massive decline in just a month and a half.

#14 Ukraine continues to fall apart financially

The worsening political and economic circumstances in Ukraine has prompted the Fitch Ratings agency to downgrade Ukrainian debt from B to a pre–default level CCC. This is lower than Greece, and Fitch warns of future financial instability.

#15 The unemployment rate in Australia has risen to the highest level in more than 10 years.

#16 The central bank of India is in a panic over the way that Federal Reserve tapering is effecting their financial system.

#17 The effects of Federal Reserve tapering are also being felt in Thailand

In the wake of the US Federal Reserve tapering, emerging economies with deteriorating macroeconomic figures or visible political instability are being punished by skittish markets. Thailand is drifting towards both these tendencies.

#18 One of Ghana’s most prominent economists says that the economy of Ghana will crash by June if something dramatic is not done.

#19 Yet another banker has mysteriously died during the prime years of his life.  That makes five“suspicious banker deaths” in just the past two weeks alone.

#20 The behavior of the U.S. stock market continues to parallel the behavior of the U.S. stock market in 1929.

Yes, things don’t look good right now, but it is important to keep in mind that this is just the beginning.

This is just the leading edge of the next great financial storm.

The next two years (2014 and 2015) are going to represent a major “turning point” for the global economy.  By the end of 2015, things are going to look far different than they do today.

None of the problems that caused the last financial crisis have been fixed.  Global debt levels have grown by 30 percent since the last financial crisis, and the too big to fail banks in the United States are 37 percentlarger than they were back then and their behavior has become even more reckless than before.

As a result, we are going to get to go through another “2008-style crisis”, but I believe that this next wave is going to be even worse than the previous one.

So hold on tight and get ready.  We are going to be in for quite a bumpy ride.

[by Michael T. Snyder, writing for The Economic Collapse Blog]

……………………………..

As always, posted for your edification and enlightenment by

NORM ‘n’ AL, Minneapolis
normal@usa1usa.com
612.239.0970

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