Posted on 04/28/2012 10:36:01 AM PDT by blam
Economic Nostradamus: We Are Literally Witnessing a Collapse
Mac Slavo
April 27th, 2012
With the Presidential election cycle in full swing our incumbent administration, the media, and their financial pundits continue to maintain that the US economy’s green shoots have blossomed into fields of golden sunflowers. Despite what we’re being told, however, the actual data tells a stunningly different story.
Richard Yamarone, a senior economist for Bloomberg Brief, has been called an economic Nostradamus for his prescient forecasting of the 2008 financial crisis, and now he’s warning that the worst is not over. In a recent interview with King World News he suggests that not only is the economic outlook a barren desert devoid of any existence of green shoots, but we have a front row seat to witness the collapse of life in America as we know it:
King World News Interview via SGT Report:
I think people are just running out of money. We have contracting, real disposable incomes. Most of the job creation that we have is from minimum wage type jobs.
you are actually seeing this collapse, contracting on a real basis, of real disposable personal incomes. If you don’t have the money, you can’t facilitate expenditures. So that’s the core of the problem. That’s what’s really going on in the US economy.
You don’t listen to what all of these bigger numbers coming across the screen tell you. You talk to the people who are running the country. 99.7% of all employer firms in this country are small businesses. So when they speak, you have to listen.
You have to listen to what the small businesses are telling you and right now they are telling you, ‘Hey, I’m the head of a 3rd or 4th generation, 75 or 100 year old business, and I’ve got to shut the doors’ or ‘I’ve got to let people go. And if I’m hiring anybody back, it’s only on a temporary basis.
In this current recession, we are not even close (to getting the jobs back) and that’s 50 months and counting.
The fact of the matter is that meaningful jobs won’t be returning any time soon. Recent (un)employment data indicate that cumulatively we are losing jobs each and every month. And, those jobs that do become available are minimum wage jobs that are insufficient to offset the income loss we’ve experienced since 2008.
The bottom line is that if people don’t have money, they can’t consume to keep the economy going. This leads to a vicious negative feedback loop that forces small (and large) business employers to lay off workers, which takes even more money out of the economy, which subsequently leads to more business closures and cutbacks.
As evidence of this effect we need look only at the most recent Gross Domestic Product (GDP) data which indicate that, while the economy is still officially growing, it’s doing so at a snail’s pace of just 2.2%. That’s the official government statistic, so of course it’s loaded with fuzzy math that fails to account for one very critical piece of information – inflation. According to John Williams of Shadow Stats, if we accounted for inflation and calculated GDP as it should be done, without government up-side distortions, our economic growth has not only slowed, it’s actually contracting at a rate of negative 2.2%. By all accounts, even though the mainstream narrative is one of growth, recovery and increased consumer spending, the US economy is and has been in a recession since 2005.
Consider that food stamp rates have doubled over that period to 48.5 million participants (that’s one in six Americans!) and that we have an unofficial machination-adjusted unemployment rate in excess of 22% and one thing becomes absolutely clear: the average Joe Sixpack is broke, hungry and dangerously close to ripping to shreds the remainder of our country’s social safety nets.
Every piece of official data the government and their mouth pieces throw at us is and has been fabricated for the better part of a decade. Inflation is four times higher than Ben Bernanke will admit. Foreclosures continue piling up and the shadow inventory of foreclosed homes is now in the multiple millions. Real estate prices are still falling, with even ‘new’ buyers who purchased homes after the 2008 collapse and thought they were getting a deal now underwater on their mortgages.
To top it all off we have the price of essential goods like food and energy going through the roof as a result of easy Fed money to banks and investment firms that has nowhere to go but stock and commodities paper markets. While all those freshly printed Federal Reserve dollars have yet to make their way to consumers in any significant way, we’re already seeing the initial effects of our monetary policies and they’re have a devastating impact on consumer gas prices and grocery store trips.
We’ve oft opined that the collapse that so many naysayers believe will never happen is, in fact, happening right here and now. The data suggests it likely occurred well before global stock markets melted down in 2008.
The aforementioned handful of data (there’s plenty more where that came from – we haven’t even gotten into the European debt debacle or the coming Japanese and Chinese economic meltdowns) is providing us a clear picture of where we’ve been and where we’re headed.
We are literally witnessing the collapse of our entire borrow-and-consume paradigm, the aftereffects of which will not be pretty, complete with hyperinflationary depression, riots, starvation and bloodshed.
It looks like we are (still) doomed. (WAD)
We are literally witnessing the collapse of our entire borrow-and-consume paradigm, the aftereffects of which will not be pretty, complete with hyperinflationary depression, riots, starvation and bloodshed.
Well, at least we have that to look forward to,
it won’t be dull.
2read
We may be getting to the point that tariffs alone, will not bring back American manufacturing.
We may need to start considering, actual blockades, against protectionist trade opponents.
One way or the other, sending US factories elsewhere, is destructive and dangerous.
I just find it hard to believe that such a perfect paradigm by design hasn't worked.
What no do over ?
Not a problem.
Simply import millions of Chinese to sop up the foreclosed homes at a fair price, reducing the supply and increasing the average price to where no one is underwater.
It will rebalance our trade deficit with China and allow the rest of us to get out from under our over-inflated mortgages and move elsewhere...
I know kids who have applied for sub $40k jobs with a hundred applicants.
I also know my small business is getting harder and harder each day to keep running. The attitude of fees has come to us. We are being charged by third parties who do invoices for our clients to submit our invoices. We are being charged thousands of dollars and hundreds of hours to participate in safety surveys and monitoring programs mandated by our clients who are mandated to do this by the Feds... it all just rolls down the hill. These programs are redundant to reporting and programs we already do. No regulations retire, they just get added on to the ones already there no matter the duplication or similarity.
On top of this IRS has declared open season on S Corporations. I know some who get audit or inquiry notices weekly from the IRS. They keep jabbing away until something sticks. Many just pay the claims instead of fighting it. Paying takes less time and less money and IRS knows it. The process is nothing but extortion.
I’m sure most of us break laws every day. There is no good way to keep up with it all. Then there is the specter of obastard care and all it brings to us.
Business in particular and small business in particular has a target all over it by this marxist administration.
I do think we are doomed.
Yet our ruling class keeps piling on regulations and taxes...
And voters keep voting for them...
Suicide.
The pathological hatred of small business by the Federal Government seems boundless. I guess it's the logical result of Marxists taking over much of the bureaucracy for the last fifty years.
Not a word from our so-called "representatives" in objection to such IRS practices, either. That's where "War on Everything" policy positions lead you - you have to shut up when those Wars eventually get declared on real Americans, or you'll get called a hypocrite by your Democratic opponent and you might even lose!
THe entire problem with the economic outlook in this country is trying to ‘run the economy’ as a consumer based economy.
We need to be a producer based economy.
And the ruling class controls who gets $$$ and media exposure.
My thoughts exactly. God gives us good advice, and we ignore it. Then we are surprised when the consequences arise.
The only way out of this is to eliminate taxes on corporations doing their work and manufacturing in the US AND tax the ones who do offshore it.
This is already underway in certain regions. Right now its mostly Chinese who have made money there (communists who ran “state-owned enterprises,”etc.). The one good thing is that (if we are allowed to repeat the common generalization ) the Chinese “make pretty good neighbors” and when they have kids (ehich they are allowed to do here) they insist that the public schools get better). This is propping up realty prices which otherwise would drop like bricks, as is the sale of large portfolios of houses (assembled thru our governmental lending-guarantee systems and otherwise) to largely-overseas investment interests (including we hear the communist Chinese banks). Its not all China, though. Its also from other countries.
Well that...
Or the US Coast Guard stops adversarial container ships on the high seas.
Increasingly, I’m in favor of the latter.
What we’re doing now isn’t working.
Except for America’s adversaries.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.