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50 Things Every American Should Know About The Collapse Of The Economy
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50 Things Every American Should Know About The Collapse Of The Economy
Courtesy of Michael Snyder at Economic Collapse
Right now, we are witnessing a truly historic collapse of the economy, and yet most Americans do not understand what is going on. One of the biggest reasons why the American people do not understand what is happening to the economy is because our politicians and the mainstream media are not telling the truth. Barack Obama and Federal Reserve Chairman Ben Bernanke keep repeating the phrase "economic recovery" over and over, and this is really confusing for most Americans because things sure don't seem to be getting much better where they live.
There are millions upon millions of Americans that are sitting at home on their couches right now wondering why they lost their jobs and why nobody will hire them. Millions of others are wondering why the only jobs they can get are jobs that a high school student could do. Families all across America are wondering why it seems like their wages never go up but the price of food and the price of gas continue to skyrocket. We are facing some very serious long-term economic problems in this country, and we need to educate the American people about why the collapse of the economy is happening. If the American people don't understand why they are losing their jobs, why they are losing their homes and why they are drowning in debt then they are going to keep on doing all of the same things that they have been doing. They will also keep sending the same idiot politicians back to Washington to represent us. There are some fundamental things about the economy that every American should know. The American people need to be shocked out of their entertainment-induced stupor long enough to understand what is really going on and what needs to be done to solve our nightmarish economic problems. If we do not wake up enough Americans in time, the economic collapse that is coming could tear this nation to shreds.
The U.S. economy was once the greatest economic machine in modern world history. It was truly a wonder to behold. It worked so well that entire generations of Americans came to believe that America would enjoy boundless prosperity indefinitely.
But sadly, prosperity is not guaranteed for any nation. Over the past several decades, some very alarming long-term economic trends have developed that are absolutely destroying the economy. If dramatic changes are not made soon, a complete and total economic collapse will be unavoidable.
Unfortunately, the American people will never agree to fundamental changes to our economic and financial systems unless they are fully educated about what is causing our problems. We have turned our backs on the principles of our forefathers and the principles of those that founded this nation. We have rejected the ancient wisdom that was handed down to us.
It has been said that those that sow the wind, shall reap the whirlwind.
We are about to experience the consequences of decades of really bad decisions.
Hopefully we can get the American people to wake up.
The following are 50 things that every American should know about the collapse of the economy....
#1 Do you remember how much was made of the "Misery Index" during the presidency of Jimmy Carter? At that time, the "Misery Index" was constantly making headlines in newspapers all across the country. Well, according to John Williams of Shadow Government Statistics, if we calculated unemployment and inflation the same way that we did back during the Carter administration, then the Misery Index today would actually be higher than at any point during the presidency of Jimmy Carter.
#2 According to the U.S. Bureau of Labor Statistics, an average of about 5 million Americans were being hired every single month during 2006. Today, an average of about 3.5 million Americans are being hired every single month.
#3 According to the Wall Street Journal, there are 5.5 million Americans that are currently unemployed and yet are not receiving unemployment benefits.
#4 All over America, state and local governments are selling off buildings just to pay the bills. Investors can now buy up government-owned power plants, prisons and municipal buildings from coast to coast. For example, the mayor of Newark, New Jersey recently sold off 16 government buildings (including the police and fire headquarters) just to pay some bills.
#5 When Americans think of "government debt", most of them only think of the federal government, but it is not just the federal government that has a massive debt problem. State and local government debt has reached an all-time high of22 percent of U.S. GDP.
#6 If you can believe it, one out of every seven Americans has at least 10 credit cards.
#7 Credit card usage in the United States is on the increase once again. During the month of March, revolving consumer credit jumped 2.9%. Sadly, it looks like Americans have not learned their lessons about the dangers of credit card debt.
#8 Last year, Social Security ran a deficit for the first time since 1983, and the "Social Security deficits" in future years are projected to be absolutely horrific.
#9 The U.S. government now says that the Medicare trust fund will run outfive years faster than they were projecting just last year.
#10 Right now we are watching what could potentially be the worst Mississippi River flood ever recorded play out right in front of our eyes. One agricultural economist at Mississippi State University believes that this disaster could do 2 billion dollars of damage just to farms alone.
#11 The "tornadoes of 2011" that we just saw in the southeast United States are being called the worst natural disaster that the U.S. has seen since Hurricane Katrina. It has been estimated that up to 25 percent of all of the poultry houses in Alabama were either significantly damaged or destroyed. It is also believed that millions of birds were killed.
#12 The economic effects of the BP oil spill just seem to go on and on and on. The number of very sick fish in the Gulf of Mexico is really starting to alarm scientists. The following is how one local newspaper recently described the situation....
Scientists are alarmed by the discovery of unusual numbers of fish in the Gulf of Mexico and inland waterways with skin lesions, fin rot, spots, liver blood clots and other health problems.
#13 The number of "low income jobs" in the U.S. has risen steadily over the past 30 years and they now account for 41 percent of all jobs in the United States.
#14 All over America, hospitals that care for the poor and needy are so overwhelmed and are so broke that they are being forced to shut down. Recently, a local newspaper in Florida ran an article about two prominent charity hospitals in Illinois that have served the poor for more than 100 years but are now asking for permission to shut down....
Two charity hospitals in Illinois are facing a life-or-death decision. There's not much left of either of them - one in Chicago's south suburbs, the other in impoverished East St. Louis - aside from emergency rooms crowded with patients seeking free care. Now they would like the state's permission to shut down.
#15 The U.S. dollar is in such bad shape that now even Steve Forbes is predicting that the U.S. is "likely" to go back to a gold standard within the next five years.
#16 Most Americans don't realize how much the U.S. dollar has been devalued over the years. An item that cost $20.00 in 1970 would cost you $115.93 today. An item that cost $20.00 in 1913 would cost you $454.36 today.
#17 Over the past 12 months the average price of gasoline in the United States has gone up by about 30%.
#18 U.S. oil companies will bring in about $200 billion in pre-tax profits this year. They will also receive about $4.4 billion in specialized tax breaks from the U.S. government.
#19 It is being projected that for the first time ever, the OPEC nations are going to bring in over a trillion dollars from exporting oil this year. Their biggest customer is the United States.
#20 According to the Pentagon, there are minerals worth over a trillion dollars under the ground in Afghanistan. Now, J.P. Morgan is starting to tap those riches with the help of the U.S. military.
#21 Speaking of J.P. Morgan, most Americans don't realize that they are actually the largest processor of food stamp benefits in the United States. In fact, the more Americans that go on food stamps the more money that J.P. Morgan makes.
#22 When 2007 began, there were about 26 million Americans on food stamps. Today, there are over 44 million on food stamps, and one out of every four American children is on food stamps.
#23 Back in 1965, only one out of every 50 Americans was on Medicaid. Today, one out of every 6 Americans is on Medicaid.
#24 Only 66.8% of American men had a job last year. That was the lowest level that has ever been recorded in all of U.S. history.
#25 The financial system is more vulnerable today than it was back in 2008 before the financial panic. Today, the world financial system has been turned into a giant financial casino where bets are made on just about anything you can possibly imagine, and the major Wall Street banks make a ton of money from this betting system. The system is largely unregulated (the new "Wall Street reform" law has only changed this slightly) and it is totally dominated by the big international banks. The danger from derivatives is so great that Warren Buffet once called them "financial weapons of mass destruction". It is estimated that the "derivatives bubble" is somewhere in the neighborhood of a quadrillion dollars, and once it pops there isn't going to be enough money in the entire world to bail everyone out.
#26 Between December 2000 and December 2010, the United States ran a total trade deficit of 6.1 trillion dollars with the rest of the world, and the U.S. has had a negative trade balance every single year since 1976.
#27 The United States has lost an average of 50,000 manufacturing jobsper month since China joined the World Trade Organization in 2001, and the U.S. trade deficit with China is now 27 times larger than it was back in 1990.
#28 In 2010, the number one U.S. export to China was "scrap and trash".
#29 All over the United States, many of our once great manufacturing cities are being transformed into hellholes. In the city of Detroit today, there are over 33,000 abandoned houses, 70 schools are being permanently closed down, the mayor wants to bulldoze one-fourth of the city and you can literally buy a house for one dollar in the worst areas.
#30 During the first three months of this year, less new homes were sold in the U.S. than in any three month period ever recorded.
#31 New home sales in the United States are now down 80% from the peak in July 2005.
#32 America's real estate crisis just seems to get worse and worse. U.S. home prices have now fallen a whopping 33% from where they were at during the peak of the housing bubble.
#33 According to a new report from the AFL-CIO, the average CEO made 343 times more money than the average American did last year.
#34 The European debt crisis could cause a global financial collapse like the one that we saw in 2008 at any time. The world economy is incredibly interconnected today, and the United States would not be immune. A recent IMF report stated the following about the growing sovereign debt crisis in Europe....
Strong policy responses have successfully contained the sovereign debt and financial-sector troubles in the euro area periphery so far. But contagion to the core euro area and then onward to emerging Europe remains a tangible risk.
#35 According to one study, the 50 U.S. state governments are collectively 3.2 trillion dollars short of what they need to meet their pension obligations.
#36 A different study has shown that individual Americans are $6.6 trillion short of what they need to retire comfortably.
#37 The cost of college tuition in the United States has gone up by over 900 percent since 1978.
#38 According to the Bureau of Economic Analysis, health care costs accounted for just 9.5% of all personal consumption back in 1980. Today they account for approximately 16.3%.
#39 One study found that approximately 41 percent of working age Americans either have medical bill problems or are currently paying off medical debt.
#40 The combined debt of the major GSEs (Fannie Mae, Freddie Mac and Sallie Mae) has increased from 3.2 trillion in 2008 to 6.4 trillion in 2011. Thanks to our politicians, U.S. taxpayers are standing behind that debt.
#41 The U.S. government is over 14 trillion dollars in debt and the budget deficit for this year is projected to be about 1.5 trillion dollars. However, if the U.S. government was forced to use GAAP accounting principles (like all publicly-traded corporations must), the U.S. government budget deficit would be somewhere in the neighborhood of $4 trillion to $5 trillion each and every year.
#42 Most Americans don't understand that the Federal Reserve and the debt-based monetary system that it runs are at the very heart of our economic problems. All of this debt is absolutely crushing us. The U.S. government spentover 413 billion dollars on interest on the national debt during fiscal 2010, and it is being projected that the U.S. government will be shelling out 900 billion dollars just in interest on the national debt by the year 2019.
#43 Standard & Poor’s has altered its outlook on U.S. government debt from "stable" to "negative" and is warning that the U.S. could soon lose its AAA rating.
#44 In 1980, government transfer payments accounted for just 11.7% of all income. Today, government transfer payments account for 18.4% of all income.
#45 U.S. households are now receiving more income from the U.S. government than they are paying to the government in taxes.
#46 59 percent of all Americans now receive money from the federal government in one form or another.
#47 According to Gallup, 41 percent of Americans believed that the economy was "getting better" at this time last year. Today, that number is at just 27 percent.
#48 The wealthiest 1% of all Americans now own more than a third of all the wealth in the United States.
#49 The poorest 50% of all Americans collectively own just 2.5% of all the wealth in the United States.
#50 The percentage of millionaires in Congress is more than 50 times higher than the percentage of millionaires in the general population.
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What is the solution? if "U.S. households are now receiving more income from the U.S. government than they are paying to the government in taxes." what can we do? There is no solution... Just absolute disaster.
#26 is the most important point to consider. Also, around 70 pct of the economy is based on consumer spending, and total debt is around $57 trillion.
but... but... Sean Corrigan says all this is scaremongering... and there are people like Bernanke to sort this mess out. Bernanke went to college; he knows what he's doing, right?
We had Gordon Brown in the UK. Gordon Brown saved the world - even said so himself: http://www.youtube.com/watch?v=5stftd5qv3M
Everyone should just relax. There is no plutocracy. This time is different. The best people are on it. Economic recovery is just round the corner...
...as long as debt ceilings are raised and more fiat is printed. The only danger is if we stop printing money and take our heads out of the sand - that would spell disaster.
ilene - nice outline and synopsis.
The issue really boils down to transparent price discovery. Once that is violated by Gov't regulations, ZIRP (negative real interest rates), Lame Stream Media promoting and covering for the pyschopaths (Obama, DSK, Geithner, Barney 'he made me bite the pillow" Frank, etc..),....the general population becomes confused with the "message".
An easy metric to reflect this fact is the low volume on the equity Exchanges.
Cognitive dissonance (with acknowledgement to the esteemed ZH'er Cog Dis) produces confusion and then anger.
The answer is (and always has been) to let the markets correct themselves (Chap 11 for the banks). This did not happen because the banksters would not take the loss financially or personally.
The battle has begun and on opposite poles we have the left wing socialists / fascists (Obama and his race based, disillusioned useful idiots, for the banksters), versus libertarian, rightish wing Ron Paul. Paul would have a hard time getting anything passed in Congress give the core of DEMs in Congress and the subsequent street riots.
Deflation first, then away we go toward hyperinflation, but declaration of martial law ultimately prevents it.
Good luck with trading markets in between these timelines.
Nothing will change? But a lot has to change. Like the structure of government. I don't think it's going to change for the reasons stated in ZH, however.
This is all well and good. Nothing will change. The rich will get richer, the congress will do everything to insure that banksters continue to rape the poor, the Dept. of War will continue the killing in the name of security (of the banksters). Knowing what the problem is does nothing to solve the problem.
Hail Ben and QEX!
sunny
The housing bubble produced an overabundance of crappy houses.
The education bubble is producing a crop of uneducated citizens.
http://www.doctorhousingbubble.com/subprime-colleges-student-loan-debt-n...
Why young people are still running up college loans is beyond me.
There are no jobs, most likely will not be (unless you are in rare atmosphere, w/ your degree).
Just to keep from sitting at home, or working for Mickey D's?
That's the bulk of the choices for most.
IF they can get hired there.
Joining the shill team who shows no solutions and only whines about the problems...
WTSHTF and TEOTWAWKI happens, where will we find toilet paper?
Affix a sponge to a stick...place in a bucket of water next to the commode. Beats the heck out of corn cobs.
Sounds like I will have to trade in a desk job for farming in my front yard. Oh, wait, that happened already.
Regarding item #19, it's not like those trillion dollars are worth the same as, say, in the seventies.
Shhh! You're diminishing the sensationalism of the article. One has to point out what little a dollar buys in today's market as opposed to 1913, and then quote the zillions of dollars the U. S. is in debt -- today. Proper journalism precludes one from adjusting for inflation in the other direction, doncha know.
Don't worry, the IMF will come to our rescue.
/sarc
Just as soon as the raping and pillaging is done. Priorites.
Major legislative deregulatory stage set by republican congress with democratic president in the 90's. The accelerated build up of capital malinvestment during 2000 - 2008 with republican and democratic held congesses with republican president. The climax and mop up of post collapse vulture capital opportunities during 2008 to present with democratic president with republican and democratic held congresses. All were globalists.
“Single acts of tyranny may be ascribed to the accidental opinion of the day; but a series of oppressions, begun at a distinguished period, and pursued unalterably through every change of administrators, too plainly proves a deliberate, systematic plan to reduce us to slavery”(***)
Thomas Jefferson
Any questions?
Only 50?
You only need to know (1) PMs, (2) lead, (3) farm [far from the crowds] & (4) water
Thanks for putting this article together and sharing it @ ZEROHEDGE ! I was beginning to think I was the only one who observed this.
But you couldn't get an iPad in 1970 or in 1913. QED
YUM iPads, I'm hungry.
Since the time of the Greek philosophers... thru de Tocqueville, history has proven, democracy only lasts as long as you have:
1) And educated populace
2) A self-disciplined populace
You left out deToqueville's most important observation, viz., "America is great because America is good."
In other words.....democracy (in this case it's actually a republic) only lasts as long as you have:
3) A moral population
Sorry about that, America.
Since the time of the Greek philosophers... thru de Tocqueville, history has proven, democracy only lasts as long as you have:
1) And educated populace
2) A self-disciplined populace
N57,
Yeah, except we are not a Democracy.
As opposed to our current state of self destructive slackers who will only work long enough to get their next tattoo? Who are satisfied with a skateboard as a means of transportation? The fact that no democracy has lasted as long as the USA is interesting by itself, but I think it has less to do with the general knowledge and integrity of the many than it does with the greed and the villainy of the few.
so can we crash and get it over with....
I have a feeling that the Propaganda Minister, Joe Goebbel's notion of "Tell a lie often enough and it becomes the truth" is starting to fail miserably here. Truly. Elmer Fudd will be able to beat Hope & Change in the 2012 election.
Maybe they are spending like there is no tomorrow, cause there might not be one.
I think TPTB know something about our future that we don't.
To much info on this subject to ignore. A ZHer posted this the other day, if its true, it explains a lot.
I find it hard not to consider this relevant to the above problems.
YouTube - Jesse Ventura - Secret Underground 2012 Base at Denver Airport
this will wake you up fo sure!
Water,
this is sad to read.
you are so right!! A system is broken when bankers make more money when people are on foodstamps. WHY is that allowed?? Someone needs to expose this info to the American people.
So, LINKEDIN goes public this morning.
You'd have thought that something important was happening should you have been watching the financial talking heads. JFC.
Amazon selling more Kindle books than print books. JFC.
It's American Idol for the financial set.
The US people dont care period.
The average middle aged American is suffering from Stockholm Syndrome so badly I think it deserves to be renamed....Boomer syndrome anyone?
I draw inspiration from my chronicly unemployed middle aged cousin who defended the f*cking Bernank at our Thanksgiving table. If his wife (the breadwinner now) weren't such a good cook, I probably would have puked over the turkey
in my dark moods i would agree and take even more pessimistic view. there is cause for optimism though, and we need not be fatalistic. a lot of smart people on this site appear to care deeply and think deeply about the current state of affairs. the conversation here is about finance, economics, and investing -- but the model of talneted, informed leaders and potential for community are pretty much established.
i share frustration with the pathetic state in which we [mainly US] now find ourselves, perhaps a modern renaissance is in order.
Classic, but it makes the point very clearly. While at my brother-in-law's house I also heard how great the bernank is, BUT here is the difference; my brother-in-law is a harvard MBA who is in that top 1%.
See where this is going? People at the very top love the system, people at the very bottom love the system - ****NO ONE IN THE MIDDLE****
Looks like everything is proceeding according to plan, but we all know just how sustainable this will be in the end.
Another shill that is great are articulating the "problems" but that offers no solutions. Totally fucking useless article, just what one might expect from a paper-pusher.
What is needed is a new economic model that is based in reality. So tell us shill, what does that look like?
Agreed. Shorten this list to "10 things " and post it to Yahoo.
Obama set to announce Billions in aid for Middle east? I thought we were broke?
http://nakedempire2.blogspot.com/
Is there ANYONE here, that believes this nation is not being puposely destroyed?.
If so, why?...........it's so obvious.
We have to help them build a central bank, federal reserve member. This is the means to that end. That way they can be "free".
As long as there is a working printer in the country, the Bernank prints...
The root cause is the mental disorder known as liberalism.
Liberalism and leftward pinheads have always been the biggest opposition to freedom and personal liberties. (FDR, Wilson to Schumer, Dickhead Durbin, ect.) The biggest thieves of the wealth of American people.
But liberals are not the only problem. The "Republicans" are have become nearly as intrusive and unlawful. (Not conservatives, but "Republicans GOP")
I suggest, as did my mentor, "that government IS the problem". Both Party's are the problem as is the size of government.
Cut the federal government in half, cut the handouts by half, follow the original documents, and Fredrick Hayak's model of economics.
Problem solved. See how easy?
Liberalism and leftward pinheads have always been the biggest opposition to freedom and personal liberties...
I just hate it when some Reichwinger asshole turns economic discussion to political bullshit. As to lefties blocking freedom and liberty try the GOP for getting into everybody's bedroom and up their birth canals. If it were up to you guys slavery would still be legal and homosexuals (males anyway) would be put to death, you would institute theocratic principals faster than the Taliban can say put on your bhurkah you silly bitch!
The root cause is If a man will not work, neither shall he eat.
Welfare.................character murder.
go try have a beer with GW and feel that boot on your head laying on the concrete.
Yeah, the "conservatives" have done so much better. Still believe the two party lie huh? Go back to sleep my little sheep. I would argue that the root cause is allowing fraud and hypocrisy to become the status quo. But I digress, yeah let's pin this all on one "ism" and eat the fucking weak since it looks like we are heading that way anyway.
Republicans and conservatives are NOT synonyms.
GOP Republicans believe in large government/ military.
Most conservatives I chat with believe in smaller government, less military.
My Conservatives friends, and myself, are seeming to realize that we are really Libertarians and not Republicans.
I don't know if you realize this, but by encasing the word conservatives in quotation marks, you make Hedgetard55's point.
Glad to see that you are catching on. Real conservatives have been dead for some time now.