Wednesday, July 31, 2013

44 Facts About The Death Of The Middle Class That Every American Should Know

Michael Snyder
Economic Collapse
July 31, 2013

What is America going to look like when the middle class is dead?  Once upon a time, the United States has the largest and most vibrant middle class in the history of the world.  When I was growing up, it seemed like almost everyone was “middle class” and it was very rare to hear of someone that was out of work.  Of course life wasn’t perfect, but most families owned a home, most families had more than one vehicle, and most families could afford nice vacations and save for retirement at the same time.  Sadly, things have dramatically changed in America since that time.  There just aren’t as many “middle class jobs” as there used to be.  In fact, just six years ago there were about six million more full-time jobs in our economy than there are right now.  Those jobs are being replaced by part-time jobs and temp jobs.  The number one employer in America today is Wal-Mart and the number two employer in America today is a temp agency (Kelly Services).  But you can’t support a family on those kinds of jobs.  We live at a time when incomes are going down but the cost of living just keeps going up.  As a result, the middle class in America is being absolutely shredded and the ranks of the poor are steadily growing.  The following are 44 facts about the death of the middle class that every American should know…

1. According to one recent survey, “four out of five U.S. adults struggle with joblessness, near poverty or reliance on welfare for at least parts of their lives”.
2. The growth rate of real disposable personal income is the lowest that it has been in decades.
3. Median household income (adjusted for inflation) has fallen by 7.8 percent since the year 2000.
4. According to the U.S. Census Bureau, the middle class is taking home a smaller share of the overall income pie than has ever been recorded before.
5. The home ownership rate in the United States is the lowest that it has been in 18 years.
6. It is more expensive to rent a home in America than ever before.  In fact, median asking rent for vacant rental units just hit a brand new all-time record high.
7. According to one recent survey, 76 percent of all Americans are living paycheck to paycheck.
8. The U.S. economy actually lost 240,000 full-time jobs last month, and the number of full-time workers in the United States is now about 6 million below the old record that was set back in 2007.
9. The largest employer in the United States right now is Wal-Mart.  The second largest employer in the United States right now is a temp agency (Kelly Services).
10. One out of every ten jobs in the United States is now filled through a temp agency.
11. According to the Social Security Administration, 40 percent of all workers in the United States make less than $20,000 a year.
12. The ratio of wages and salaries to GDP is near an all-time record low.
13. The U.S. economy continues to trade good paying jobs for low paying jobs.  60 percent of the jobs lost during the last recession were mid-wage jobs, but 58 percent of the jobs created since then have been low wage jobs.
14. Back in 1980, less than 30% of all jobs in the United States were low income jobs.  Today, more than 40% of all jobs in the United States are low income jobs.
15. At this point, one out of every four American workers has a job that pays $10 an hour or less.
16. According to one study, between 1969 and 2009 the median wages earned by American men between the ages of 30 and 50 declined by 27 percent after you account for inflation.
17. In the year 2000, about 17 million Americans were employed in manufacturing.  Today, only about 12 million Americans are employed in manufacturing.
18. The United States has lost more than 56,000 manufacturing facilities since 2001.
19. The average number of hours worked per employed person per year has fallen by about 100 since the year 2000.
20. Back in the year 2000, more than 64 percent of all working age Americans had a job.  Today, only 58.7 percent of all working age Americans have a job.
21. When you total up all working age Americans that do not have a job, it comes to more than 100 million.
22. The average duration of unemployment in the United States isnearly three times as long as it was back in the year 2000.
23. The percentage of Americans that are self-employed has steadily declined over the past decade and is now at an all-time low.
24. Right now there are 20.2 million Americans that spend more than half of their incomes on housing.  That represents a 46 percent increase from 2001.
25. In 1989, the debt to income ratio of the average American family was about 58 percent.  Today it is up to 154 percent.
26. Total U.S. household debt grew from just 1.4 trillion dollars in 1980 to a whopping 13.7 trillion dollars in 2007.  This played a huge role in the financial crisis of 2008, and the problem still has not been solved.
27. The total amount of student loan debt in the United States recently surpassed the one trillion dollar mark.
28. Total home mortgage debt in the United States is now about 5 times larger than it was just 20 years ago.
29. Back in the year 2000, the mortgage delinquency rate was about 2 percent.  Today, it is nearly 10 percent.
30. Consumer debt in the United States has risen by a whopping1700% since 1971, and 46% of all Americans carry a credit card balance from month to month.
31. In 1999, 64.1 percent of all Americans were covered by employment-based health insurance.  Today, only 55.1 percent are covered by employment-based health insurance.
32. One study discovered that approximately 41 percent of all working age Americans either have medical bill problems or are currently paying off medical debt, and according to a report published in The American Journal of Medicine medical bills are a major factor inmore than 60 percent of all personal bankruptcies in the United States.
33. Each year, the average American must work 107 days just to make enough money to pay local, state and federal taxes.
34. Today, approximately 46.2 million Americans are living in poverty.
35. The number of Americans living in poverty has increased by more than 15 million since the year 2000.
36. Families that have a head of household under the age of 30 have a poverty rate of 37 percent.
37. At this point, approximately 25 million American adults are living with their parents.
38. In the year 2000, there were only 17 million Americans on food stamps.  Today, there are more than 47 million Americans on food stamps.
39. Back in the 1970s, about one out of every 50 Americans was on food stamps.  Today, about one out of every 6.5 Americans is on food stamps.
40. Right now, the number of Americans on food stamps exceeds the entire population of the nation of Spain.
41. According to one calculation, the number of Americans on food stamps now exceeds the combined populations of “Alaska, Arkansas, Connecticut, Delaware, District of Columbia, Hawaii, Idaho, Iowa, Kansas, Maine, Mississippi, Montana, Nebraska, Nevada, New Hampshire, New Mexico, North Dakota, Oklahoma, Oregon, Rhode Island, South Dakota, Utah, Vermont, West Virginia, and Wyoming.”
42. At this point, more than a million public school students in the United States are homeless.  This is the first time that has ever happened in our history.  That number has risen by 57 percent since the 2006-2007 school year.
43. According to U.S. Census data, 57 percent of all American children live in a home that is either considered to be “poor” or “low income”.
44. In the year 2000, the ratio of social welfare benefits to salaries and wages was approximately 21 percent.  Today, the ratio of social welfare benefits to salaries and wages is approximately 35 percent.
And not only is the middle class being systematically destroyed right now, we are also destroying the bright economic future that our children and our grandchildren were supposed to have by accumulating gigantic mountains of debt in their names.  The following is from a recent articleby Bill Bonner
Today, the U.S. lumbers into the future with total debt equal to about 350% of GDP. In Britain and Japan, the total is over 500%. Debt, remember, is the homage that the future pays to the past. It has to be carried, serviced… and paid. It has to be reckoned with… one way or another.
And the cost of carrying debt is going up! Over the last few weeks, interest rates have moved up by about 15% — an astounding increase for the sluggish debt market. How long will it be before long-term borrowing rates are back to “normal”?
At 5% interest, a debt that measures 3.5 times your revenue will cost about one-sixth of your income. Before taxes. After tax, you will have to work about one day a week to keep up with it (to say nothing of paying it off!).
That’s a heavy burden. It is especially disagreeable when someone else ran up the debt. Then you are a debt slave. That is the situation of young people today. They must face their parents’ debt. Even serfs in the Dark Ages had it better. They had to work only one day out of 10 for their lords and masters.
We were handed the keys to the greatest economic machine in the history of the planet and we wrecked it.
As young people realize that their futures have been destroyed, many of them are going to totally lose hope and give in to despair.
And desperate people do desperate things.  As our economy continues to crumble, we are going to see crime greatly increase as people do what they feel they need to do in order to survive.  In fact, we are already starting to see this happen.  Just this week, CNBC reported on the raging epidemic of copper theft that we are seeing all over the nation right now…
Copper is such a hot commodity that thieves are going after the metal anywhere they can find it: an electrical power station in Wichita, Kan., or half a dozen middle-class homes in Morris Township, N.J.Even on a Utah highway construction site, crooks managed to abscond with six miles of copper wire.
Those are just a handful of recent targets across the U.S. in the $1 billion business of copper theft.
“There’s no question the theft has gotten much, much worse,” said Mike Adelizzi, president of theAmerican Supply Association, a nonprofit group representing distributors and suppliers in the plumbing, heating, cooling and industrial pipe industries.
The United States once had the greatest middle class in the history of the world, but now it it dying.
This is causing a tremendous amount of anger and frustration to build in this nation, and when the next major wave of the economic collapse strikes, a lot of that anger and frustration will likely be unleashed.
The American people don’t understand that these problems have taken decades to develop.  They just want someone to fix things.  They just want things to go back to the way that they used to be.
Unfortunately, the great economic storm that is coming is not going to be averted.
Get ready while you still can.  Time is running out.

Related posts:
  1. Saving Money? Not In This Economy – 22 Facts That Prove Middle Class Families Are Being Savagely Crushed
  2. The Middle Class In America Is Being Wiped Out – Here Are 60 Facts That Prove It
  3. 18 Sobering Facts Which Prove That The Middle Class Is Not Being Included In This “Economic Recovery”
  4. Middle Class Areas Shrink As Income Gap Grows, New Report Finds
  5. Rampant Unemployment = The Death Of The Middle Class

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Tuesday, July 30, 2013

VIDEO: The Carbon Tax Scam Will Be The Biggest Transfer of Wealth in History



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Big Banks Manipulated Energy Markets In California and the Midwest … Ripping Off Tens of Millions of Dollars in 9 Months

 Washington’s Blog
July 30, 2013

Energy Markets Are Manipulated

The Federal Energy Regulatory Commission says that JP Morgan has massively manipulated energy markets in  California and the Midwest, obtaining tens of millions of dollars in overpayments from grid operators between September 2010 and June 2011.
As shown below, big banks have manipulated virtually every other market as well – both in the financial sector and the real economy – and broken virtually every law on the books.

Commodities Are Manipulated

The big banks and government agencies have been conspiring to manipulate commodities prices for decades.
The big banks are taking over important aspects of the physical economy, including uranium mining, petroleum products, aluminum, ownership and operation of airports, toll roads, ports, and electricity.
And they are using these physical assets to massively manipulate commodities prices … scalping consumers of many billions of dollars each year.

Interest Rates Are Manipulated

Interest rates are rigged:
Derivatives Are Manipulated

The big banks have long manipulated derivatives … a $1,200 Trillion Dollar market.
Indeed, many trillions of dollars of derivatives are being manipulated in the exact same same way that interest rates are fixed: through gamed self-reporting.

Currency Markets Are Rigged

Currency markets are massively rigged.

Gold and Silver Are Manipulated

The Guardian and Telegraph report that gold and silver prices are “fixed” in the same way as interest rates and derivatives – in daily conference calls by the powers-that-be.

Oil Prices Are Manipulated

Oil prices are manipulated as well.

Everything Can Be Manipulated through High-Frequency Trading

Traders with high-tech computers can manipulate stocksbonds, options, currencies and commodities. And see this.

Manipulating Numerous Markets In Myriad Ways

The big banks and other giants manipulate numerous markets in myriad ways, for example:
  • Engaging in mafia-style big-rigging fraud against local governments. See thisthis and this
  • Shaving money off of virtually every pension transaction they handled over the course of decades, stealing collectively billions of dollars from pensions worldwide. Details hereherehereherehere,herehereherehereherehere and here
  • Pledging the same mortgage multiple times to different buyers. See thisthisthisthis and this. This would be like selling your car, and collecting money from 10 different buyers for the same car
  • Pushing investments which they knew were terrible, and then betting against the same investments to make money for themselves. See thisthisthisthis and this
  • Engaging in unlawful “Wash Trades” to manipulate asset prices. See thisthis and this
  • Participating in various Ponzi schemes. See thisthis and this
  • Bribing and bullying ratings agencies to inflate ratings on their risky investments
The Big Picture
The big picture is simple:
  • The big banks manipulate every market they touch
  • The government has given the banks huge subsidies … which they are using for speculation and other things which don’t help the economy. In other words, propping up the big banks by throwing money at them doesn’t help the economy
  • The big banks own the D.C. politicians … so Congress and the White House won’t do anything unless the people force change
Related posts:
  1. Sprott Berates Berkshire’s Buffoons And Says “All Markets Are Manipulated”
  2. The Federal Reserve Is Paying Banks NOT To Lend 1.8 Trillion Dollars To The American People
  3. Money Markets Ease on Unlimited Dollars Pledge
  4. Top Banking Analyst: Subsidies to Giant Banks Exceed $780 Billion Dollars Per YEAR
  5. Manipulated U.S. Rates Seesaw Gold Prices

Friday, July 19, 2013

The Welfare States of America: Government food aid recipients now outnumber full-time private sector workers

Ethan A. Huff
Natural News
July 19, 2013

For the first time in history, the number of people in the United States receiving assistance from the federal government to pay for food has exceeded the number of full-time, private sector workers, according to new data released by the U.S. Department of Agriculture (USDA). Based on the latest available figures, the overall number of food welfare recipients today exceeds the number of regular working folks by nearly four million, and the gap is continuing to widen.
An ominous foretelling of America’s dire future, the more than 101 million people in America currently receiving government food aid represent nearly one third of the overall U.S. population. Comparatively, less than one third of the entire U.S. population, or roughly 97 million people, currently has a viable, full-time job, according to the U.S. Bureau of Labor Statistics (BLS), and this figure has been on the decline in recent years.
“The U.S. Department of Agriculture estimates that a total of 101,000,000 people currently participate in at least one of the 15 food programs offered by the agency, at a cost of $114 billion in fiscal year 2012,” explains one report on the announcement. “Of the 101 million receiving food benefits, a record 47 million Americans participated in the Supplemental Nutrition Assistance Program (SNAP), commonly known as food stamps.”
What this all means, of course, is that our once great nation, built by hard-working, innovative, and creative individuals from all walks of life, has devolved into one of the worst kinds of nanny states imaginable. Sure, there are still millions of honest, industrious people that are actually producing things and contributing positively to society. But these folks are increasingly having to bear the load of the welfare crowd, the ranks of which are constantly expanding.
“As noted, John Q Public has been reduced to ‘either a mouth to be fed, a pocket to be picked, or a political obstacle to be finessed, nothing more,’” writes Debra Heine for Breitbart.com about this unraveling of American society.

Many welfare recipients now have higher ‘incomes’ than the actual workers subsidizing their handouts

And how right she is, as the average “poor” household on government assistance today now receives about $168 per day from taxpayers, according to a recent report by TownHall.com. These welfare payments, which cover not only food costs but also housing, childcare, and healthcare, average out to about $30 per hour for a 40 work week, which is far more than what millions of working individuals and families make per week.

“The median wage for non-welfare recipients is $25 per hour but because they pay taxes, unlike welfare recipients, the wage is bumped down to $21 per hour,” writes Katie Pavlich for TownHall.com. “Taxpayers are no longer simply helping the poor, they’re subsidizing the lives of welfare recipients at a better rate than their own.”
In other words, the working class is now collectively forking over more of its earnings to sustain the welfare class, and much of this is being distributed in the form of food stamps and other food assistance. And if this trend continues, society will eventually reach a breaking point in which there are no longer enough actual contributors to support all the takers.
“[F]or increasingly more it is now more lucrative — in the form of actual disposable income — to sit, do nothing, and collect various welfare entitlements, than to work,” explains ZeroHedge.com. “For every 1.25 employed persons in the private sector, 1 person receives welfare assistance or works for the government.”

Sources for this article include:
http://www.breitbart.com
http://townhall.com
http://www.zerohedge.com

Related posts:
  1. Government Dependents Outnumber Those With Private Sector Jobs In 11 U.S. States
  2. Welfare recipients trade in food stamps for cash to buy illicit street drugs, weapons
  3. Welfare, food stamp recipients could soon be required to get microchipped with RFID tags
  4. Food Stamp Recipients at Record 41.8 Million Americans in July, U.S. Says
  5. Outrageous! The Government Is Giving Out Free Cell Phones And Free Cell Phone Minutes To Welfare Recipients

11 Depressing Stats About Detroit

SAM RO
Business Insider
July 19, 2013

Earlier today, Detroit filed for Chapter 9 bankruptcy, the largest municipal bankruptcy in history.
Municipal bond experts Peter Hayes and James Schwartz of Blackrock published a brief analytical note earlier this month titled “Distress In Detroit.” In it they offered some stats that would make anyone cringe.
Here are eleven of them:
  1. Detroit’s population has plunged 63% since 1950.
  2. …and it’s down 26% since 2000.
  3. The unemployment rate hit a high of 27.8% in July 2009.
  4. As of April 2013, the unemployment rate was at 16%.
  5. Even though the population fell 63% since 1950, the municipal workforce fell by just 40%, adding to the strain on public finances.
  6. Detroit has the highest violent crime rate of any large U.S. city
  7. …it’s five times higher than the national average.
  8. 40% of the city’s street lights don’t work.
  9. 78,000 structures and 66,000 lots are abandoned.
  10. Arson accounts for 1,000 of 12,0000 fires per year.
  11. …60% of those arson fires are in dilapidated or empty buildings.
Read Hayes & Schwartz note at BlackRock.com.

Obama To Detroit: “No Bailout For You”

Zero Hedge
July 19, 2013

While in the past President Obama has been more that willing to throw good money after bad and “refuse to let Detroit go bankrupt,” it seems when push comes to shove – under the intense scrutiny of a nation awash in scandal, a drastically bifurcated congress – that despite the imploring from local congressmen for “moar” already - that the savior of the city will not this time ride to the rescue on his white horse. In a statement, the White House said they “are monitoring the situation in Detroit closely,” with no hint – just as they have made clear for months – of any sort of Federal bailout.
As USA Today notesthe federal government provided federal loans to prevent New York City from declaring bankruptcy during the 1970s. But times have changed; the federal government has debt and financial problems of its own, and a Detroit bailout could run into significant opposition in Congress and cause serious damage in the Muni market.
While the GM debacle put pensioners ahead of creditors, it would be unprecedentedly bad for the massive Muni bond market should Obama acquiesce and change the law once again to put pensioners ahead of GOs…

The White House statement on Detroit.
 ”The president and members of the president’s senior team continue to closely monitor the situation in Detroit.
While leaders on the ground in Michigan and the city’s creditors understand that they must find a solution to Detroit’s serious financial challenge, we remain committed to continuing our strong partnership with Detroit as it works to recover and revitalize and maintain its status as one of America’s great cities.”
Translation: ”sorry guys, you’re on your own on this one!”

Congressman Asks Obama For “Immediate Support” With Detroit Bankruptcy

Zero Hedge
July 19, 2013

Four years ago he bailed out the city’s automotive industry, and a whole lot of union votes. Moments ago, Obama was just called in again, this time to bail out the entire city. “Representative Chaka Fattah (D-PA), a leader of the Congressional Urban Caucus, sent a letter to President Obama today calling on the Administration to lend a helping hand to Detroit, Michigan following the news that the city has filed for bankruptcy.” So will the president play favorites? Or will the municipal bailout begin where the private sector bailout ended? And since bailouts tend to be contagious, if and when Obama does “lend a helping hand” to Detroit, paid for by all US taxpayers, which city, or rather cities, will demand the same treatment? And how long until other people’s money finally runs out?
From PR Newswire
Urban Caucus Leader Calls on Federal Government to Support Detroit
Congressman Fattah asks the President to act immediately to help the City of Detroit.
Representative Chaka Fattah (D-PA), a leader of the Congressional Urban Caucus, sent a letter to President Obama today calling on the Administration to lend a helping hand to Detroit, Michigan following the news that the city has filed for bankruptcy.
In the correspondence, Fattah requests the Administration intercede to make certain that Detroit’s future is secure and hopeful. He asks the President to bring together members of his cabinet and members of the White House Council on Strong Cities, Strong Communities to work together to analyze Detroit’s fiscal situation and intervene on the city’s behalf.
Fattah said in his letter, “I understand the important role cities play in the economic vitality of metropolitan regions and our nation as a whole. Our cities serve as economic engines leading to innovations, job creation and growth. Moreover, cities like Detroit are strategically aligned, within their respective regions, to attract economic opportunities for their surrounding areas. As such, we must do all we can to protect these cities and work toward their prosperity.
Fattah stands ready to work with John Conyers and the rest of the Michigan delegation on this important issue.
Elsewhere, the parodies have already begun:


Thursday, July 18, 2013

The “McDonald’s Budget”: Laughably Unrealistic But Also Deeply Tragic

Michael Snyder
Economic Collapse
July 18, 2013

Can you support a family on $2,000 a month?  Recently, McDonald’s and Visa teamed up to launch a website that is intended to help employees of McDonald’s manage their money.  The aspect of the website that is getting a tremendous amount of national attention is the “McDonald’s Budget” which is a sample monthly budget which is designed to help workers plan their spending.  You can see a copy of it for yourself right here.  This budget is laughably unrealistic, but it is also deeply tragic, because there are tens of millions of American workers that are actually trying to raise families on this kind of an income.
The first thing that you will notice about the McDonald’s Budget is that it expects workers to have two jobs.  It is an open admission that working at McDonald’s is not enough to survive.  So this budget assumes that the worker will take on a second job which will pay nearly as much as the first one does.  Assuming that both jobs pay about the minimum wage, the budget will require about 70 to 80 hours of work every week.
People can put in those kind of hours for a time, but after a while your body starts to break down.  I have been there, and I have known many others that have been there.
But let’s assume that the hypothetical worker that this budget is for can work that many hours indefinitely.  The budget assumes a yearly income of about $24,000 after taxes, and that would make it a fairly typical budget for a typical working class American.
In the United States today, 47 percent of all U.S. workers make less than $25,000 a year before taxes.  So millions upon millions of U.S. workers are trying to make ends meet each month on very limited incomes.
Does the “McDonald’s Budget” provide any solutions for those workers?
Well, this budget allocates $0 for food, so if you plan on following this budget you might want to anticipate fasting a lot each month.
This budget also allocates $0 for gasoline.  So either you will have to ride a bicycle or walk everywhere you go.
This budget does not allocate any money for clothing either.  If you really need something to wear, perhaps you can take some cash from the “monthly spending money” category and go down to the local thrift store and get something.
In addition, this budget has no money for water, no money for child care and you might as well forget about saving for retirement.  But if you work yourself 70 to 80 hours a week, you probably won’t even make it to retirement age anyway.
So what are some of the things that actually are in the budget?
Well, it allocates $20 a month for health insurance.
Wow – where can I sign up for that health insurance plan?
As the Washington Post noted, nobody is going to be able to get health insurance that cheaply…
Low-income individuals receive assistance from Medicaid, but an after-tax income of $24,720 would put Medicaid out of reach in most states. The same point will likely apply to the subsidies offered by Obamacare: An individual with an income of $17,000 in California will be able to get a basic health insurance plan at no cost, but an individual making $28,000 will have to pay at least $137 per month.
So even a young, healthy person will have to pay $100 or more for an individual health insurance policy in most circumstances. Perhaps McDonalds is tacitly admitting that many low-income workers, including McDonalds employees, can’t afford health insurance and simply make do without it.
The original version of the budget also assumed that the worker would spend zero dollars a month on “heating”.
Perhaps McDonald’s just expects their workers to freeze all winter.
 
The new version of the budget now allocates $50 a month for heating.  Perhaps that may work for the state of Florida, but anyone that lives in a northern state knows that it takes a whole lot more than that just to heat up your home to a level that is barely livable during the winter.
This budget is absolutely crazy.  But perhaps even more patronizing then the budget itself is the following statement that is made on the website: “You can have almost anything you want as long as you plan ahead and save for it.”
Oh really?
Do they expect anyone to actually fall for that line?
Don’t get me wrong.  Working at McDonald’s is great for some people.  I worked there myself when I was in high school.  But the vast majority of adult Americans need jobs that will enable them to take care of their families.  And those kinds of jobs are rapidly disappearing.
Last month, the U.S. economy lost 240,000 full-time jobs.  We are about 6 million full-time jobs below the all-time record that was set back in 2007.  For much more on this, please see my previous article entitled: “The Decline Of Breadwinner Jobs Has Resulted In The Longest Bread Lines In American History“.
Today, one out of every four American workers has a job that pays $10 an hour or less.  A lot of very talented people are cutting hair, flipping burgers or working for temp agencies.  Those people should be doing something that takes advantage of their skills and abilities, but the U.S. economy is not producing enough of those kinds of jobs anymore.
Unfortunately, this is only just the beginning.  The next major wave of the economic collapse is rapidly approaching, and when it strikes unemployment in this country is going to get much worse.
So don’t put all of your faith in the system, because the system is failing.  Even if you do have a good job right now, you could lose it at any moment.
Whatever you can do to become more independent of the system is a good thing.  For example, starting up a side business is a wonderful thing.  It takes a tremendous amount of effort, but nobody can fire you if you are the boss.
So what do you think of the “McDonald’s Budget”?  Please feel free to share your opinion by posting a comment below…

Wednesday, July 17, 2013

Nothing Can Stop It: “An Economic Collapse that is Going to be Worse than 1929″

Mac Slavo
SHTFPlan.com
July 17, 2013

Before anybody in America ever cared about AIG, credit markets or bailouts, Karl Denninger had warned that the fuse was burning and had “gone inside the box.” This was in September of 2008, about a month before the bottom fell out of global markets and the giant kaboom was heard ’round the world. He had repeatedly sounded the alarm. A “credit event” was coming, and it couldn’t be stopped. No one listened.
The aftermath of the credit detonation that followed will go down in history as one of the most severe economic crises since the Great Depression.
Now, nearly 5 years on, we’re right back to where we started. In fact, we’re much worse off than ever before and in all likelihood we’re going to experience an event so severe it’ll make the Great Depression look like a picnic.
The time is fast approaching when the US government, the Federal Reserve and private banking conglomerates lose control of the entire system. When that occurs, confidence by the public, as well as our foreign creditors, will be lost.
And according to Karl Denninger, the math says it’s going to happen within two years time.
Employers are cutting full-time employees back to part-time to avoid the requirement of providing health insurance under Obama Care.  Trader Karl Denninger says, “As the Obama Administration runs against the economic reality of what they passed, they are now trying to find ways to dodge it. . . .The Obama Administration’s reaction to this has been to unilaterally, and by the way illegally, put off the imposition of mandate.”  
This is not going to save the teetering economy as Denninger contends, “Bernanke has lost control of the bond market and, in general, his policy. . . . The reality is the Fed is not in charge, and when that confidence level breaks, you are going to see all hell break loose.”
Denninger goes on to predict, “We are setting up for a collapse that is going to be worse than 1929, and it’s going to come sometime within the next two years.  It could come as soon as the next couple of months, but it is going to happen, and there’s nothing that is going to stop it.”
Karl Denninger with Greg Hunter’s USA Watchdog
Join Greg Hunter as he goes One-on-One with Karl Denninger of Market-Ticker.org:



Denninger and many others who had warned us what was coming were right on target with their forecasts. They’re warning us again.
We can bury our heads in the sand.
We can hope for change.
We can pretend that the people in Washington and Wall Street have our best interests at heart.
None of it will help. The math is clear. The system is broken.
The pain is coming.
You’d better be getting prepared for it, because the end game is 100% guaranteed.

Report: Brinks Vaults Are Being Depleted: “This Has the Appearance of a Run On the Bank”

Mac Slavo
SHTFPlan.com
July 16, 2013

The price of gold and silver has seen a massive decline as of late, prompting one analyst to suggest that there is no compelling fundamental reason to own precious metals and the only thing investors can do now is “hope and panic, in that order.”
But while current prices and technical charts may leave some with the feeling that gold’s bull run is over and the bubble has popped, others are scooping up as much yellow and silver metal as they can find, and in some cases they’re doing it by the tens of thousands of ounces.
According to recent data from the Chicago Mercantile Exchange, private investors are rapidly exchanging their paper holdings and turning them into deliverable physical assets, an indication that the purported ‘free market’ price for gold on global exchanges is grossly undervalued.
Brinks is now being depleted.  
They have gone from 447,199 on July 3rd to 134,525 on July 9th which is a drop of 312,674 oz.
If this is correct, then this is a decline of 70 percent in the gold held in private accounts at Brinks in just one week.
If this is data is correct, it would not be too much of a stretch to say that this has the appearance of ‘a run on the bank.’
Jesse’s Cafe Americain via Steve Quayle
Commodities guru Doug Casey recently noted that it costs mining companies about $1200 an ounce to get gold out of the ground. Given that the price of gold is hovering right at that amount as of this writing it should be obvious that the going price for gold at this time is not sustainable. Either demand has waned and gold producers are going to be closing up shop soon because their business models will not be able to function under these prices, or we’re set to see prices bounce back significantly in coming months and years.
If we are to believe that investors are losing interest in precious metals, then how is it possible that major gold retailers like JM Bullion were reporting weeks-long delivery delays citing “astounding volume” from the retail sector?
Even the US Mint has seen such high demand (118% increase year-over-year) that they have actually suspended the sale of some of their gold American Eagles because they are unable to source the gold blanks required to strike the coins.
Obviously what mainstream analysts are reporting and what is happening in the real world are two different things, as evidenced by the large scale physical deliveries being reported around the globe.
The price of gold may have dropped 25% in the last 12 months, but a similar scenario unfolded from 1975 to 1976 when gold dropped nearly 50%, only to recover and go to new highs, quadrupling in value over the subsequent five years.
We’ve noted previously that the volatility in financial markets will be so extreme that even gold investors will be shaken.
If there’s one thing that should be clear, it’s that the global economic crisis is nowhere close to be resolved, and recovery could be a decade or more away. In fact, chances are we have yet to see the worst of it.
It is during environments exactly like these – when the people fear their government and lose confidence in its ability to mitigate crises – that precious metals become the investment asset of last resort.
It has happened throughout history. And it’s happening right now.

Treasury: Debt Has Been Exactly $16,699,396,000,000.00 for 56 Days

Terence P. Jeffrey
CNS News
July 16, 2013

According to the Daily Treasury Statement for July 12, which the U.S. Treasury released this afternoon, the federal debt that is currently subject to a legal limit of $16,699,421,095,673.60 has stood at exactly $16,699,396,000,000.00 for 56 straight days.
That means that for 56 straight days the federal debt has remained approximately $25 million below the legal limit.
Even though the portion of the federal debt that is subject to a legal limit has not changed in almost two months, the Treasury has continued to sell bills, notes and bonds at a value that exceeds the value of the bills, notes and bonds it has been redeeming.
The “public debt subject to limit”–as the Treasury calls the portion of the federal debt that is legally limited by Congress–first hit $16,699,396,000,000.00 at the close of business on May 17.

Full article here

Employers start slashing jobs ahead of Obamacare implementation

J. D. Heyes
Natural News
July 16, 2013

As we have reported regularly here at Natural News, Obamacare – which takes effect in its entirety January 1 – is going to be a mega-disaster for Americans. The law will create long lines at doctor’s offices; it will create – and then worsen – a shortage of primary care physicians and providers; it will not control costs, as advertised; it will cause insurance rates to go up (which is already happening); and – perhaps most important – it will even worsen unemployment and underemployment in America.

Per the Washington Post‘s Ed Rogers:
Right now, small businesses across America are making the final determinations on how to reduce the working hours of their employees so fewer employees qualify for the mandated, employer-provided health insurance. Employers are also deciding whether it makes more economic sense to pay a fine to the government or pay for healthcare benefits for their employees. What this means is that hundreds of thousands – and perhaps even millions – of Americans will learn that they are being dismissed from their employer’s healthcare coverage.

‘No one is talking’

Rogers, along with other writers, analysts and policy experts, say the coming tsunami of “healthcare pink slips” are most likely coming by late summer/early fall. When that happens, many Americans will be shoved into healthcare exchanges established by the law and will – for the first time – have to start writing a check for their health insurance (especially younger, healthier Americans). And that will reduce take-home pay, which means “the negative effects on personal income and the overall economy will be undeniable,” Rogers writes.
“Sometime next year, before the elections, the penalties associated with not having or providing health insurance will begin to pour in. Will the fines come in the mail? Will you be able to appeal? What happens if someone doesn’t pay? No one knows. Or, no one who knows is talking. The consequences of ObamaCare are being hidden,” he says.
It should be noted that this is what happens when one party or the other controls the lawmaking branches of power (the Legislative and Executive branches) – often we get bad law. During President Bush’s first term, in response to the 9/11 attacks, dominant Republicans passed the USA Patriot Act, the impetus of which has been responsible for the NSA’s sustained spying on Americans during the Obama administration.

As far as Obamacare goes, Democrats own it; where once they sang its praises as a “reform measure” that would make healthcare cheaper and more accessible, now – as the news about its eventual roll-out gets worse – they are being silent about its coming consequences.
As far as hurting employment, a recent poll of small business owners found that the law is already affecting hiring. Note that under the law, almost all companies with 50 or more full-time employees will have to either offer health coverage or face a fine of $2,000 per full-timer after the first 30 workers.

‘There is no chance Obamacare will perform as promised’

“We were startled because we know that employers were concerned about the Affordable Care Act and the effects it would have on their business, but we didn’t realize the extent they were concerned, or that the businesses were being proactive to make sure the effects of the ACA actually were minimized,” attorney Steven Friedman of Littler Mendelson, which commissioned a Gallup poll to measure the effect of the law on employment, told CNBC.
“If the small businesses’ fears are reasonable, then it could mean that the small business sector grows slower than what economic conditions otherwise would indicate. And small businesses have been a growth engine in the economy,” he said.
According to the survey, 41 percent of businesses questioned said they had frozen hiring for the time being because of uncertainty over the affects of Obamacare; about one-fifth, or 19 percent, said “yes” when asked if they had “reduced the number of employees you have in your business as a specific result of the Affordable Care Act.”
And 38 percent said they had scaled back growing their companies in the coming year because of Obamacare.
“Some of the Democrats’ reactions will be predictable, i.e. blaming Bush and blaming Republicans, or for a while, denying the obvious. But that won’t work forever,” writes Rogers. “One of the worst sins you can commit in politics is to say something that’s different from what people can see for themselves. There is no chance that Obamacare will perform as promised and when it doesn’t, voters will be looking for relief.”

Update: Many readers may already know that the president has decided to delay the so-called “employer mandate” for a year – a move most political observers say is due to the fact that Obama doesn’t want fellow Democrats running for reelection to have to deal with Obamacare’s fall-out during the 2014 midterm elections.
But business owners aren’t stupid. They know the mandate is likely to return after the elections, so they’re not going to be anxious to fill positions and expand their operations regardless of the one-year delay. They know that, eventually, they will have to deal with the employer mandate.
So, unless the mandate goes away altogether, don’t expect to see massive hiring and improved job growth for full-time employment anytime soon.

VIDEO: The Economic Collapse Is Starting To Heat Up





Federal Court Overturns Block on NDAA Indefinite Detention

Americans can legally be kidnapped and held without trial

Paul Joseph Watson
Prison Planet.com
July 17, 2013

The Second Circuit court has overturned a temporary injunction which had blocked the indefinite detention provision of the National Defense Authorization Act (NDAA) – meaning Americans can now once again be kidnapped and held without trial.

In September 2012, United States District Court Judge Katherine B. Forrest ruled that the indefinite detention provision of the NDAA was unconstitutional and blocked it permanently. However, within 24 hours of the ruling the Obama administration lodged an appeal and the law has been under temporary injunction until now.
Americans can once again “legally” be snatched off the street and detained without trial based on the mere claim that they provided aid or support to terrorists, despite this being a total violation of habeas corpus.
The Tenth Amendment Center has a detailed breakdown of the ruling;
“In layman’s terms, Forrest put a stop to indefinite detention, and the Second Circuit overturned that. It also permanently prohibited Forrest from attempting to do so again, ordering her to proceed with the case consistent with their opinion. NDAA “indefinite detention” powers are alive and well.”
The group points out that the new Second Circuit ruling is completely incorrect because it claims that Section 1021 of the 2012 NDAA says nothing about the government’s ability to detain citizens.
In reality, section 1021 states, “Congress affirms that the authority of the President to use all necessary and appropriate force pursuant to the Authorization for Use of Military Force . . . includes the authority for the Armed Forces of the United States to detain covered persons . . . pending disposition under the law of war.”
The ruling stems out of Hedges v. Obama, a lawsuit filed in January 2012. Pulitzer Prize-winning journalist Chris Hedges and several other high profile figures brought the case in order to protest against the potential that the law could be used to harass outspoken journalists and political activists.
“Sadly, the “victory” lasted about 10 months. Today, US totalitarianism wins again,” laments Zero Hedge.

*********************
Paul Joseph Watson is the editor and writer for Infowars.com and Prison Planet.com. He is the author of Order Out Of Chaos. Watson is also a host for Infowars Nightly News.

VIDEO: Lindsey Williams On The Coming Derivatives Crash

VIDEO: Gregory Mannarino Economic Collapse News 7/17/13. Is A Military Takeover & Financial Collapse Of AMERICA Upon Us?














Friday, July 5, 2013

Obamacare Strikes: Part-Time Jobs Surge To All Time High; Full-Time Jobs Plunge By 240,000

Zero Hedge
July 5, 2013

As a reminder: jobs have quantity and quality components. The quantity component was good enough to convince the 10 Year the taper is imminent (if not stocks, which continue to trade dislocated from any and all fundamentals). But how about the quality? In a word: not good. In June, the household survey reported that part-time jobs soared by 360,000 to 28,059,000 - an all time record high. Full time jobs? Down 240,000.  And looking back at the entire year, so far in 2013, just 130K Full-Time Jobs have been added, offset by a whopping 557K Part-Time jobs. And there is your jobs “quality” leading to today’s market euphoria (if only for now).

Continue reading here:  http://www.zerohedge.com/news/2013-07-05/obamacare-strikes-part-time-jobs-surge-all-time-high-full-time-jobs-plunge-240000

Catholic Bishop: Supreme Court ‘Giving Legal Protection to an Intrinsic Evil’

Terence P. Jeffrey
CNS News
July 5, 2013

Bishop Thomas John Paprocki, leader of the Roman Catholic Diocese of Springfield, Ill., says the U.S. Supreme Court is giving “legal protection to intrinsic evil” in its decisions late last month that advanced the cause of legalized same-sex “marriage” in the United States.
“As in the case of Roe v. Wade striking down abortion laws forty years ago, the United States Supreme Court has again usurped its legitimate prerogative through a raw exercise of judicial power by giving legal protection to an intrinsic evil, this time by striking down the Defense of Marriage Act in the case of U.S. v. Windsor and in refusing to take up the defense of Proposition 8 in California in the case of Hollingsworth v. Perry.
“These hollow decisions are absolutely devoid of moral authority,” said the bishop. “It is becoming increasingly and abundantly clear that what secular law now calls “marriage” has no semblance to the sacred institution of Holy Matrimony. People of faith are called to reject the redefinition of marriage and bear witness to the truth of Holy Matrimony as a lasting, loving and life-giving union between one man and one woman.”

Full article here

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  4. Supreme Court, gun control, and the Second Amendment: a reckoning
  5. Gay marriage ruling: Supreme Court finds DOMA unconstitutional

Have Central Bankers Lost Control? Could The Bond Bubble Implode Even If There Is No Tapering?

Michael Snyder
Economic Collapse
July 5, 2013

Are the central banks of the world starting to lose control of the financial markets?  Could we be facing a situation where the bond bubble is going to inevitably implode no matter what the central bankers do?  For the past several years, the central bankers of the planet have been able to get markets to do exactly what they want them to do.  Stock markets have soared to record highs, bond yields have plunged to record lows and investors have literally hung on every word uttered by Federal Reserve Chairman Ben Bernanke and other prominent central bankers.  In the United States, it has been remarkable what Bernanke has been able to accomplish.  The U.S. government has been indulging in an unprecedented debt binge, the Fed has been wildly printing money, and the real rate of inflation has been hovering around 8 to 10 percent, and yet Bernanke has somehow convinced investors to lend gigantic piles of money to the U.S. government for next to nothing.  But this irrational state of affairs is not going to last indefinitely.  At some point, investors are going to wake up and start demanding higher returns.  And we are already starting to see this happen in Japan.  Wild money printing has actually caused bond yields to go up.  What a concept!  And that is what should happen – when central banks recklessly print money it should cause investors to demand a higher return.  But if bond investors all over the globe start acting rationally, that is going to cause the largest bond bubble in the history of the planet to burst, and that will create utter devastation in the financial markets.
Central banks can manipulate the financial system in the short-term, but there is usually a tremendous price to pay for the distortions that are caused in the long-term.
In Bernanke’s case, all of this quantitative easing seemed to work well for a while.  The first round gave the financial system a nice boost, and so the Fed decided to do another.  The second round had less effect, but it still boosted stocks and caused bond yields to go down.  The third round was supposed to be the biggest of all, but it had even less of an effect than the second round.  If you doubt this, just check out the chartsin this article.
Our financial system has become addicted to this financial “smack”.  But like any addict, the amount needed to get the same “buzz” just keeps increasing.  Unfortunately, the more money that the Fed prints, the more distorted our financial system becomes.
The only way that this is going to end is with a tremendous amount of pain.  There is no free lunch, and there are already signs that investors are starting to wake up to this fact.
As investors wake up, they are going to realize that this bond bubble is irrational and entirely unsustainable.  Once the race to the exits begins, it is not going to be pretty.  In fact, the are indications that the race to the exits has already begun
During the month of June, fixed income allocations fell to a four-year low, according to the American Association of Individual Investors, as major bond fund managers like Pimco experienced record withdrawals for the second quarter. That pullback sent places like emerging markets and high-yield bonds reeling—just as the Federal Reserve signaled plans to taper its easy-money policies within the coming years. Benchmark bond yields ticked up on that news, and in an unexpected twist, the stock market nosedived as well.
A lot of people out there have been floating the theory that the Fed will decide not to taper at all and that quantitative easing will continue at the same pace and therefore the markets will settle back down.
But what if they don’t settle back down?
Could the bond bubble implode even if there is no tapering?
That is what some are now suggesting.  For example, Detlev Schlichter is pointing to what has been happening in Japan as an indication that the paradigm has changed…
My conclusion is this: if market weakness is the result of concerns over an end to policy accommodation, then I don’t think markets have that much to fear. However, the largest sell-offs occurred in Japan, and in Japan there is not only no risk of policy tightening, there policy-makers are just at the beginning of the largest, most loudly advertised money-printing operation in history. Japanese government bonds and Japanese stocks are hardly nose-diving because they fear an end to QE. Have those who deal in these assets finally realized that they are sitting on gigantic bubbles and are they trying to exit before everybody else does? Have central bankers there lost control over markets?
After all, money printing must lead to higher inflation at some point. The combination in Japan of a gigantic pile of accumulated debt, high running budget deficits, an old and aging population, near-zero interest rates and the prospect of rising inflation (indeed, that is the official goal of Abenomics!) are a toxic mix for the bond market. It is absurd to assume that you can destroy your currency and dispossess your bond investors and at the same time expect them to reward you with low market yields. Rising yields, however, will derail Abenomics and the whole economy, for that matter.
The financial situation in Japan is actually very similar to the financial situation in the United States.  We both have “a gigantic pile of accumulated debt, high running budget deficits, an old and aging population, near-zero interest rates and the prospect of rising inflation”.  In both cases, rational investors should demand higher returns when the central bank fires up the printing presses.
And if interest rates on U.S. Treasury bonds start to rise to rational levels, the U.S. government is going to have to pay more to borrow money, state and local governments are going to have to pay more to borrow money, junk bonds will crash, the market for home mortgages will shrivel up and economic activity in this country will slow down substantially.
Plus, as I am fond of reminding everyone, there is a 441 trillion dollar interest rate derivatives time bomb sitting out there that rapidly rising interest rates could set off.
So needless to say, the Federal Reserve is scared to death of what higher interest rates would mean.
But at this point, they may have lost control of the situation.

Related posts:
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  3. QE3 Already Has Gone Wrong
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