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Gallup CEO Blasts US Leadership "The Economy Is Not Coming Back"
Authored by Jim Clifton, Gallup CEO & Chairman,
The U.S. now ranks not first, not second, not third, but 12th among developed nations in terms of business startup activity. Countries such as Hungary, Denmark, Finland, New Zealand, Sweden, Israel and Italy all have higher startup rates than America does.
We are behind in starting new firms per capita, and this is our single most serious economic problem. Yet it seems like a secret. You never see it mentioned in the media, nor hear from a politician that, for the first time in 35 years, American business deaths now outnumber business births.
The U.S. Census Bureau reports that the total number of new business startups and business closures per year -- the birth and death rates of American companies -- have crossed for the first time since the measurement began. I am referring to employer businesses, those with one or more employees, the real engines of economic growth. Four hundred thousand new businesses are being born annually nationwide, while 470,000 per year are dying.
You may not have seen this graph before.
Until 2008, startups outpaced business failures by about 100,000 per year. But in the past six years, that number suddenly turned upside down. There has been an underground earthquake. As you read this, we are at minus 70,000 in terms of business survival. The data are very slow coming out of the U.S. Department of Census, via the Small Business Administration, so it lags real time by two years.
Net Number of New U.S. Firms Plummets
Business startups outpaced business failures by about 100,000 per year until 2008. But in the past six years, that number suddenly reversed, and the net number of U.S. startups versus closures is minus 70,000.
My hunch is that no one talks about the birth and death rates of American business because Wall Street and the White House, no matter which party occupies the latter, are two gigantic institutions of persuasion. The White House needs to keep you in the game because their political party needs your vote. Wall Street needs the stock market to boom, even if that boom is fueled by illusion. So both tell us, "The economy is coming back."
Let's get one thing clear: This economy is never truly coming back unless we reverse the birth and death trends of American businesses.
Dead-Wrong Thinking
It is catastrophic to be dead wrong on the biggest issue of the last 50 years -- the issue of where jobs come from. Our leadership keeps thinking that the answer to economic growth and ultimately job creation is more innovation, and we continue to invest billions in it. But an innovation is worthless until an entrepreneur creates a business model for it and turns that innovative idea in something customers will buy. Yet current thinking tells us we're on the right track and don't need different strategies, so we continue marching down the path of national decline, believing innovation will save us.
I don't want to sound like a doomsayer, but when small and medium-sized businesses are dying faster than they're being born, so is free enterprise. And when free enterprise dies, America dies with it.
Let's run some numbers. You will often hear from otherwise credible sources that there are 26 million businesses in America. This is misleading; 20 million of these reported "businesses" are inactive companies that have no sales, profits, customers or workers. The only number that is useful and instructive is the number of current operating businesses with one or more employees.
There are only 6 million businesses in the United States with one or more employees. Of those, 3.8 million have four or fewer employees -- mom and pop shops owned by people who aren't building a business as much as they are building a life. And God bless them all. That is what America is for. We need every single one of them.
Next, there are about a million companies with five to nine employees, 600,000 businesses with 10 to 19 employees, and 500,000 companies with 20 to 99 employees. There are 90,000 businesses with 100 to 499 employees. And there are just 18,000 with 500 employees or more, and that figure includes about a thousand companies with 10,000 employees or more. Altogether, that is America, Inc.
Let me be very clear. America, Inc. is far more important to America's security than our military. Because without the former prospering -- and solvent -- there is no latter. We have enormous military power only because of a growing economy that has, so far, made it possible for the government to pay its bills. When former Chairman of the Joint Chiefs of Staff, Adm. Mike Mullen, was asked in a Senate hearing on June 28, 2011, to name the biggest current threat to the security of the United States, he didn't say al-Qaida. He didn't say Iran's nuclear capabilities. He answered, "I believe our debt is the greatest threat to our national security."
Declining Businesses Mean Declining Revenues for Social Spending
Keep in mind that these 6 million businesses, especially small and medium-sized ones, provide jobs for more than 100 million Americans and much of the tax base for everything. These small, medium and big businesses have generated the biggest economy in the world, which has allowed the country to afford lavish military and social spending and entitlements. And we've been able to afford all of this because, until now, we've dominated the world economy.
When new businesses aren't being born, the free enterprise system and jobs decline. And without a growing free enterprise system, without a growing entrepreneurial economy, there are no new good jobs. That means declining revenues and smaller salaries to tax, followed by declining aid for the elderly and poor and declining funding for the military, for education, for infrastructure -- declining revenues for everything.
America has maintained the biggest tax coffers in the world because its 300+ million citizens have produced and owned one-quarter of virtually all global wealth. The United States clobbered everyone in the battle of free enterprise, in the battle of business building, and in the battle of inventing the future. Until recently, America had blown the world away in terms of economic success. We are now quickly losing that edge, and everything we're trying to do to fix the problem is dead wrong.
Here's why: Entrepreneurship is not systematically built into our culture the way innovation or intellectual development is. You might say, "Well, I see a lot of entrepreneurial activity in the country." Yes, that's true, but entrepreneurship is now in decline for the first time since the U.S. government started measuring it.
The whole country and subsequently the world are having their own dead-wrong moment, and it is causing America and the whole world to make everything worse. And people know it, though they may not know why. When Gallup asked Americans to rate how much they personally worry about particular problems facing the country, the top three issues that respondents worry about a "great deal" were the economy (59%), federal spending and the budget deficit (58%), and the availability and affordability of healthcare (57%).
The more we execute on our leadership's erroneous belief in innovation, the more our engine stalls out -- and the more people rightly worry about economic issues.
Because we have misdiagnosed the cause and effect of economic growth, we have misdiagnosed the cause and effect of job creation. To get back on track, we need to quit pinning everything on innovation, and we need to start focusing on the almighty entrepreneurs and business builders. And that means we have to find them.
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Was out of Country Last Year, met all kinds of Retirees setting up houses or apartments. Many of them had businesses before. They gave up. They want simple living, good health care, and some nice scenery.
Hannity is a paid shill:
All Employees: Mining and Logging: Oil and Gas Extraction
2014-10: 215.6 Thousands of Persons (+ see more)
Monthly, Seasonally Adjusted, CES1021100001, Updated: 2014-11-07
Education & Health Services
http://research.stlouisfed.org/fred2/series/USEHS (21.4 Million rock steady through 2008) All Employees: Education & Health Services
Of course the real money is in management or Professional services... and of course FIRES, Finance, Insurance, Real Estate.
I believe it's going to come down to FOOD, SHELTER, CLEAN WATER, & ENERGY.
Think accordingly.
AMEN BROTHER. When we reward actual value creation rather than financial engineering (and stop the glorified theft / rigging of our "markets" for HFT/MM, we'll start to heal.
ever since 2008 you say? hmmmmmmmmmmmmm
How can someone write an article on this subject without assessing the impact of the biggest issue of the past 50 years - the baby boomer population bulge which first stimulated jobs and new business creation and now goes into retirement?
True but consider we spend about $1 Trillion on MIC, Security Every Year when you count the Black Budget Programs as best you can. I figure from 2002 or 2003 we spend $10 Trillion on DoD & Military over 12 Years. That is serious Coin.
Total—Department of Veterans Affairs Outlays 2014 = $154.05 Billion
Total—Department of Veterans Affairs Outlays 2013 = $143.6 Billion
Total—Department of Veterans Affairs Outlays 2000 = $50.1 Billion
Total—Department of Veterans Affairs Outlays 1998 = $45.6 Billion
-------
Total—International Assistance Program Outlays 2014 = $49.37 Billion
Total—International Assistance Program Outlays 2013 = $48 Billion
Total—International Assistance Program Outlays 2000 = $25.7 Billion
Total—International Assistance Program Outlays 1998 = $26 Billion
----
Total--Department of Homeland Security Outlays 2014 = $53,812 Billion
Total--Department of Homeland Security Outlays 2013 = $66.5 Billion
Total--Department of Homeland Security Outlays 2000 (FEMA) = $3.9 Billion
Total--Department of Homeland Security Outlays 1998 (FEMA) = $2.9 Billion
----
Total—Department of Defense—Military Outlays 2014 = 580.13 Billion
Total—Department of Defense—Military Outlays 2013 = $609.4 Billion (Down from $650 B)
Total—Department of Defense—Military Outlays 2000 = $283 Billion
Total—Department of Defense—Military Outlays 1998 = $257.9 Billion
Oh and don't forget Health Care Cost. Go to a Foreign Country and see what you can get for $50 bucks at their best hospital. I've even seen Dentists and Doctors visit a patient at a Hotel.
So $1 T for MEDICARE/MEDICAID, $1 T for Social Security, $1 Trillion for Military (NSA, CIA)
....$10 Trillion on MIC over 12 Years........
The Proper Equation:
As a % of GDP the Same 12 Years ?
Maintenance and Projection of World Power has Benefits and Costs....
I started a company 20 years ago..at that time it was a hassle getting all the licenses, permits, and accounts to start..then when it was open ..all the government rules and regulations that take up most of your time filling out the forms and following the rules...OSHA, Health codes...EEOC..Insurance....and I bet today there are another 100 regulations you have to follow to start a company...and they wonder why no one starts a company anymore....just think if the Wright Brothers had to follow all the rules and regulations building the airplane in their garage....they could not do it...
- 75,000 Pages of New Regs in 2014...
- 70,000 Pages in the US Tax Code...
.gov system = Monster = System Monster = Black Swan Candidate
The USA is no longer a viable corporation due to mismangement, criminal activity, and a lack of real business ethics. Casino Capitalism
had a shelf life that expired on March 10th 2008. One cannot feed a country on rotten spoiled food that has hit the expiry date years ago.
No matter how much Congress and the White House wants the economics of America to turn around it will never come back until
the present system, and criminals that occupy it, are removed from
positions of power and control. Casino Capitalism failed, does not work,
is ineffectual, and cannot continue to exist if the people that support it cannot pay their debts or deficits. This is not complicated stuff, USA.
"We have enormous military power only because of a growing economy that has, so far, made it possible for the government to pay its bills."
Does ANYONE actually believe this BS? We've FINANCED All the wars for the 20th and 21st century with DEBT
We now have a $US that is now worth 1/100th of what it was a hundred years ago and a total national debt that can NEVER be repaid.
That US military has come at the cost of trillions NOT invested in truly productive endeavors - not to mention millions dead in wars that should never have been fought (go watch Ike's farewell speech - a soldier warnign about what was to come). Oh... and don't forget the hatred of millions around the world as well....we've earned that by taking what we wanted at the end of a gun. 'They' don't hate us for our 'freedoms' - they hate us for taking THEIR freedom - supporting dictators, oligarchs and looting their resources - and eliminating any that dare object. Go read Smedley Butler. War IS a racket.
But a few - a VERY few - have gotten fantastically wealthy in the process and that's all that matters, right?
Now go bow to your lords and masters.
Yeah, I was going to call it BS too. But I realized that he mean that as the economy really tails out... like Individual Tax Revenue Declines, then maybe the CON-Gress would be forced to cut back the Federal Budget.
Individual Income Taxes Receipts 2012 = $1.132 Trillion
Individual Income Taxes Receipts 2013 = $1.316 Trillion
Individual Income Taxes Receipts 2014 = $1.395 Trillion
Corporate Income Taxes Receipts 2012 = $ 242.3 Billion
Corporate Income Taxes Receipts 2013 = $ 273.5 Billion
Corporate Income Taxes Receipts 2014 = $ 320.7 Billion
"Yes, that's true, but entrepreneurship is now in decline for the first time since the U.S. government started measuring it."
I have news for Mister Jim Clifton:
The Government doesn't spread around statistics that make it look bad. It doesn't even collect or publish certain things. We know the GDP is phoney unless it is broken down into all it's pieces to look at what we have. We know the Basket of Goods inflation doesn't include Housing, Education, or Health Care.
I've been posting the declining numbers of US Banks for a year now. FRED Charts. It is not new at all. I posted an article about decline of small business 3 years ago. Farms were small businesses, then have been declining in numbers since like 1920 or when the data started to be collected.
Foreigners Invest more in the USA than Domestic Private Investment. Savings is low in the USA, but most credit and loans is created out of thin air no based on Household Savings Deposits.
----
Well we have low velocity since like 1981 or at most since 1997 if you are looking at M2.
- http://research.stlouisfed.org/fred2/series/MANEMP (High was 1979, Employees: Manufacturing 12.1 M Persons)
http://research.stlouisfed.org/fred2/series/mult (High was 1987, Up to Date, but looks like Crap, .769 is all)
http://research.stlouisfed.org/fred2/series/M1V (High 2007, M1 seems to increase with Mortgages)
http://research.stlouisfed.org/fred2/series/M2V (High 1997, M2 seems to show different bubble perhaps)
http://research.stlouisfed.org/fred2/series/MZMV (MZM seems to show peak in Economy 1981)
- Exponential Corporate Profits
- Exponential US Production Increases
- Housing Inflation
- Medical Inflation
- Tuition Inflation/Student Loan Inflation (Interest)
- Credit Card Interest Inflates Debt & Consumer Costs
http://research.stlouisfed.org/fred2/series/CP ($1.89 Trillion, Exponential Growth, corporate profits, 1-1-2014)
------------------------------
---- Bankruptcy Rate --------
------------------------------
15.5% Bankruptcy Rate per person over 20 Years for US Citizens (Snapshot in Time).
What does ZH Think about the Cost of Living, Jobs, Economy, and Health Care in Light of this???
1.7 Million People in US will Face Bankruptcy this year due to Medical Bills (Jim Cramer). 147 + 98 = 245 M working aged. 1.7 M / 245 M = .69% Bankruptcy Rate per year per person Minimum. A US Rate of .77% Bankruptcy rate per year per person is reasonable based on 1.7 M / 219.6 M aged over 25 years old.
20 Years Rate = 1.7 * 20 / 219.6 = 15.5% Bankruptcy Rate per person over 20 Years.
http://www.amednews.com/article/20130708/business/130709932/6/
http://www.debt.org/bankruptcy/statistics/ (Repeat Filers)
http://www.infoplease.com/us/census/data/demographic.html
http://quickfacts.census.gov/qfd/states/00000.html
- 60% of bankruptcies are due to medical bills.
- Younger patients had two to five times higher rates of bankruptcy than cancer patients 65 or older.
- Since the early 1990s, bankruptcy has been used with increasing frequency by older individuals. While more senior citizens are declaring bankruptcy, a decreasing percentage of filers are younger than 25.
------------------------------
---- Bankruptcy Rate --------
------------------------------
115.6 million = Total Households
2.63 people per Household
74.3 Million people under 18 years old
244.7 Million people over 18 years old
99.4 Million people under 25 years old
219.6 Million people over 25 years old
319 Million = Total Population (FRED)
245 Million = Total Population over 16 years old (BLS)
147 Million = Total Employed (FRED & BLS)
92 Million = Total Not in Labor Force (FRED)
98 Million = Total Not in Labor Force (BLS over 16)
Active Population: Aged 25-54: Males for the United States©
2013: 53,964,000.00000 Persons (+ see more)
Annual, Not Seasonally Adjusted, LFAC25MAUSA647S, Updated: 2014-02-05
http://research.stlouisfed.org/fred2/series/LFAC25MAUSA647S
------------------------------
---- Bankruptcy Rate --------
------------------------------
Discussion of this conclusion that we have a 15.5% Bankruptcy Rate per person over a 20 year period would include many things:
- Cost of Living in the USA is going up YOY, and will continue in Housing, Education, Health Care, Food, Taxes, Cost of Debt
- There is a Repeat Bankruptcy rate of like 16%
- 2005-2010 Sub-prime & Global Financial Crisis was an Event that weighs on figures, but we see repeated Crashes & Scandals
- Racketeering & Fraud are Systemic at some level in the USA
- Demographics changes, population increases, people get dumber about financial matters, people fall into debt faster these last 30 years
riveting cut and paste
Where as you don't teach, share info, Add noting to the Thread... and you appear to enjoy power.
I actually do my own work and then cut and paste.
We are riveted waiting for your next pronouncement.
The overwhelming elephant in the room that no one it seems to wants to blame or talk about is get this the Marxist thinking Barack Hussein Obama and people just like him that have taken over his party and the halls of government. Go figure history repeating itself.
This article cuts far too close to the bone for my comfort.
In my small/med business, the government provides the BIGGEST hurdles. I avoid hiring FT and mostly hire <30h/week because of government regulations and rules. Honestly, I'm afraid to hire at this point. We're automating as fast as we can afford to do so. It would be far, far easier to hire people, but employees, in this climate, are liabilities -- treating employees as dangerous necessities that must be quickly eliminated because of what the government may do or is now doing through its stupid, repressive and expensive mandates/regulations/rules/taxes/whatever.
Unlike so many articles that speak of moving American businesses back to America, I'm starting another business in another country and intend to slowly fold the one here in the States. Why? The government.
Its not just Obamacare (though, for me, that was the last nail in the coffin). Its workman's comp. Ridiculous environmental rules. The cost of complying with regulations, the number of which ever increase. Taxation and more taxation. Little nicks here and there to the bottom line.
This is a command economy, not a free market. Intuitively, businesses know this and are folding, failing or leaving.
Funny you should mention opening overseas. I know two merikan doctors who are going overseas to practice both said it's too difficult here due to the paperwork. Both are merikans and merikan trained at top med schools. One going to Shanghai area and the other Denmark.
Same time, seems like most of the new doctors in my area are Indians, most of whom were trained in their home country but decided to move here due to much better living conditions they tell me.
Globalization at so many differen tlevels, eh.
I call it "communism."
Of my friends in business and that includes some older business partners the general feeling is that the US is anti-business, period. They think they can import poverty, spend and raise the debt levels and tax at 100% if possible.
The risk is too high so many buy equities in very large multinational companies and take the dividends and profits {KMB, HE, PG, UPS and WMB}. That said, the Republicans are not that much better. They talk a strong game buy their leaders are also big spenders and tolerate high taxes.
We need to cut government, cut spending, cut taxes and chuck about 1500 obtuse statutes that impact business.
jmnsho
You didn't build that.
With proclamations like this it's a wonder why there are more business deaths than births.
http://m.youtube.com/watch?v=i-P-CoSNYaI
http://m.youtube.com/watch?v=192oEC5TX_Q
This list may look familiar
Lenin's dream and how well it turned out.
Numbers are racist
My brother-in-law made $17,000 in his basement last week, oh, wait, what? He's a Colorado weed grower.
Just legalize ass. Instant sole proprietorship on every corner and millions of startups.
He's right, it ain't coming back...
http://www.globaldeflationnews.com/anatomy-of-a-bubble-how-the-federal-r...
How dare he turn on dear leader! Doesn't he know the consequences?
I closed down both my businesses this year. Got one more year left on a service contract and then it's SayaFuckingNara to NYC and the DiBlasio regime.
President Dindu Nuffins is doing a great job overseeing the last throes of the American Empire.
See you on the beach.
Mr. Clifton must have been asleep for the last 15 or 20 years. Our onerous debts, contracted over the same time, have already placed a dead weight on the economy and this is most pronounced and obvious with respect to small business formation, this is not a recent phenomenon. Kill the goose that lays the golden egg and you are in a world of trouble, no shit! Thank God we have a printing press. We are truly eff'd!
".......Kill the Goose that Lays the Golden Egg and you are in a World of Trouble........"
"Nuff Said".
This guy - Clifton - can NOT be that stupid. He seems to think they're trying to "fix" things .. what an ass-hat. This is textbook Cloward and Piven, Jimmy-Boy. They're not trying to "save" the US, they're trying to destroy it - and as BB Netenyahooo says, "Once we have sucked what we can out of the United States, it can dry up and blow away..."
Sometimes I wonder if these "CEO-types" are just feigning stupidity so they can claim they didn't know what was going on when they end up "having" to lay off thousands of people....
+100!
Its critical mass, they did not plan on the internet.
Most people are starting to question why they should work there entire lives, who for, what for, and why there is this class of people who lie, cheat and steal and seem to have all the wealth.
As more and more question the current perception of reality, more and more people seek information, through that information they find the truth the ugly truth. That they have been lied too there entire lives so they can be controlled and dominated for the state, who is nothing but a front for the fraudulent bankers who own all corporate wealth and government.
They have become greedy, have eroded middle class wealth and made the cost of living a nightmare, most people well over 50% now live week to week pay check to pay check in a constant state of stress and uncertainty.
The future has been bought and sold and they youth cannot even find a job and the debt of the west is now at a point where it will never be paid back with compounding interest adding fuel to the fire, all due to a small group of greedy demented little men who believe they have a right to rule.
This will not end well, this was never suppose to end well, and now all the shit has floated to the surface the true enemies of mankind are clear as day.
In the 1980's I read a magazine article. Approximately 90% of people in the USA in 1900 owned or were a part of a small business. Black Smith, store owner, farmer, whatever. I am going by memory.
By 1980 the number had dropped significantly.
Nowadays the focus is on degree, career with fortune 500 and so on. America was not built on degrees and ask Gates and company why they didn't finish theirs and became the richest guy out there.
It is getting tough to compete against the Wal Marts due to purchasing power. Most manufactures won't give mom and pop the same price as they would Walmart due to quantity and so on.
These too big to fail anything are guaranteeing failure to the independents.
You can definatley point out the lack of work ethic in certain demographics in comparison to the Asians. Call Asia "commie" or whatever. ALL of the Asian countries I've been to were way more business friendly than the U.S. BEFORE the tech sector and NAFTAs. And their living expenses were way more reasonable.
Today the presstitutes are calling them "shadow banking", but back in the day- lenders in Asia were acting in accordance to our "Blue Sky" laws. It's "shadow" because it hasn't been formalized.
But anyways, you are spot on. There's nothing wrong with a degree. I mean, I want my doctor to pass his organic chem exams and I want my engineers to pass their physics exams.
Degrees DO help. I could give a rats ass about Gates whose upper middle class family lifestyle and his tuition was afforded by his bank of lawyer daddy or else he wouldn't have had the opportunities he did if he were forced to live hand to mouth. And I believe a law degree requires a college education.
But I digress.
Ownership and management of your own is a huge asset if you need a lifeline. Many people throughout the world had to survive like this in "socialist" governments.
The only difference is that the very too few huge multinational corporate giants and others are able to buy off the politicians too easily, and back in the day the government had laws against companies growing too big.
Nothing new here. USA has been going down for over 20 years. The pace of decline is just pikcing up, that's all.
Nothing new here. USA has been going down for over 20 years. The pace of decline is just pikcing up, that's all.
Nah - we're just getting closer to the center of the swirling vortex of water. And the blue bowl cleaner dispenser ran out a loooong time ago.
Don't mean to hijack the thread but had an Interesting story for those out here in insanely sane land. Was at the LCS today and noticed a sign that said due to shortages of physical metals because of FUTURES activity has forced us to raise premiums.
Anyone else seen this as of this new year? Love to hear about it.
Ours has a lot less junk silver than a year ago.
Interesting narrative.
In other words, your LCS bought high and wants to recoup it. Why they made up such a weird excuse, who knows.
So Gallup wants to spur us into a gallop?
Entrepreneurs will not be moved. We do what we do, pay people and give folks livelihoods at our own pace.
Poll-suckers.
I wish each social security number came with small business incorporation.
Each person being a small business.
Each SSN is a special .biz, the receivable column starts and ends red.
After all this you mean to tell me there weren't no fuckin green shoots.
I'm headed to Venezuela to get a primer on what's coming.
Keep stackin- TP and Kotex, the new PMS!
(haha, a pun)!
The vampires and bureaucrats eat them as soon as they sprout. Tender shoots are tasty, you know?
The .gov goat chews everything to the roots.
The writer of the post is exactly right.
Making a living is not about being "world class", the "best and brightest" or any other feel good catch phrase. Its about eating when you have to, keeping the rain off, and having something something to wear.
There is no excuse for the fact that our participation rate is abysmal but we are unable to make our shoes, socks and underwear.
It is appalling that laws and regulations are crafted so that an individual person cannot use their own labor to keep theirself alive.
It is shameful when government thinks it is in "business" and uses cititation quotas for revenue.
It strangulates when minor government functionaries with a whiff of power grind someone into the ground when all they did was try to feed their child.
It simply won't work when the debt/growth model is forced on the grass roots entrepreneur. The grass roots entrepreneur grows on equity. He doesn't qualify for any debt.
Exactly. Any large MNC or retail chain (before they all went Tango Uniform) existed because they learnt to speak the language of The International Debt Merchants.
Business plans, MBA-speak, buzzwords and all the rest.
As I said many years ago here in ZH... Anyone who starts a new business in the USSA is stark raving insane, and self-destructive.
Well, what do you know. A few people are still sane. And/Or just not interested in endless abuse.
Oh, I forgot. Maybe they also are tired of hearing "you didn't create that". Well, looks like the smart ones... LITERALLY DIDN'T. Good for them.
Galt. You're talking about going Galt.
No way he took a poll to come to that.
Probably one of the single most important reads on Zerohedge of how bad off our "present" and "future" is!...
If anyone in their right minds thinks this will be resolved by pushing the button for only two candidates I don't wish you any good luck!
Until there is a sea change that requires the loss of "red bodily fluids" this picture is only going to get far worse!
This has nothing to do with pursuing "conservative" economic, tax, military, deficit, trade and deregulatory policies for 30+ years. We need more of the same.
Amen brother.
Duh.......... what do you expect when your manufacturing sectors have been offshored to China.
Hi Jim,
Welcome to our Extremist List.
Regards
President Dindu Nuffins
I would love this contrasted against credit and access to bank loans. I have two friends who work in small business loans for small banks (one in Hampton Roads and one in Boston) and man it has become a really tough business for multiple reasons for some intended and unintended consequences results of various pieces of legislation but the main one was Frank/Dodd. Don't kid yourselves and act as if that wasn't written by the ABA to benefit the largest banks, avoid breaking them up, and pass regulations which did nothing to improve transprency/sustainability/etc but just drive small and regional banks out of business and ditto place a real struggle on credit loans. I used to have residental and commerical accounts at BOA and Citizens Bank. F@ck both of them and that applies to any large bank.
Ditto the US Chamber of Commerce whose influence shouldn't be underestimated. They used to be even 30 years ago a legit organization that generally represented all business interestes but since NAFTA and increasingly are just whores for big companies which increasingly have large percentages of revenue streams from abroad.
Update your thinking - it is the second biggest economy in the world.
We are currently in the window of the change. Could have happened 4 years ago by the most optimistic estimates, might happen by 2025 by the most pessimisitic.
USA is Number 2, get used to it.
India won't get to number 2 until the end of the century so there is no need to worry about slipping to Number 3 any time soon...
I have been banging on about this for years and no one seems to listen.
I started in business in the 80's dealing with SME's in financial planning and gradually growing to work with SME's on mergers sales takeovers and so on. expansion, financing and the likes all needed to have those businesses accurately valued.
ACCURATELY valued, meaning you needed to look at the numbers, and check them and calculate to the nth degree the potential the liabilities, the risks and the upside.
Lives and livelihoods depending on getting it right.
No casino scamming non GAAP ponzi fuck wit guess work was involved. No rushing out trying to scam gullible muppets to dump their life savings into a next sure thing. No fucking with numbers and paying some shit for brains cock sucking fresh grad who thought he knew it all from Wall Street ever got involved.
And Guess what It wasn't just the last 6 years this has been going on.
This started in real earnest in 2005, 2005 is when I calculated that the risk to capital to SME's from bureaucratic shit had overtaken all other combined risk to capital, i.e. suppliers going bust, customers going bust, flood earthquake, meteorites, getting caught with your pants down with the neighbors underage kid, You fucking name it, interest rate rises, bank failure, theft anything, the one thing that was the biggest risk to capital and accounts now to an average of 70% as opposed to about 20% in the 80's is fucking layer after after layer after layer of thick suffocating miasmic choking bureaucracy and local corruption.
So fucking thick deep and unaccountable these thieving corrupt vile evil parasites are now not only feeding off the only thing now left that sustains them but actually eating the body as well as draining the life blood.
The Big crony capitalist structures became that way to survive. They had the clout, they could buy the stinking parasites and they learned in just a few short years how to lobby and spend money and corrupt to survive.
But the SME's could not do that they didn't have the resources for that. And as the biggest corporates get ever deeper into corrupt cronyism the pressure built on the SME's.
6 million businesses less 18,000 employing 500 or more, just about equal to the number of listed companies and the rest are frozen out of the capital markets.
So still 6 million, now dropping at the rate and accelerating by 70,000 a year.
Bear in mind that in the good times the failure rate was around 80 % of SME's failed within a few years and the rate is far higher today than in the 80's then you can see the trend.
But it will not change. And the reason is simple. Because you are asking for the other 300 million turkeys to vote for Christmas.
Because to change it around a lot of blood has to run, and the first blood would be the millions of parasitic stinking bureaucrats that infest every corner of the SME world.
And they have their tentacles now so deeply embedded that you cannot prise these foul parasites off your back without killing the host.
So you shut down, call it a day cash in and retire. No one will buy your company, because the numbers just do not make sense any more.
You cannot sell it and hope to get back anything like a return that mitigates your future spending with interest rates so low,
Put differently, you are fucked any which way, the parasites will take it even as you are dying in taxes and capital gains and every other fucking new regulation and fees to pay on shutting up shop.
So in 2005 I calculated what was happening and realized it included me too.
So I shut it down, took a trip to China and the far east and settled on opening a company in the Philippines.
Now that is where head office is, all business I do is transacted through that company, and all profits flow to the UK to a company there, a shell company that is nothing more than an investment and administration company, that also makes no profits and pays no taxes as no no employees live in the UK or shareholders.
It is perfectly true that the capital of tax avoidance is London.
If you think that this decline can be halted somehow you are dreaming, the entire country lives on the backs of just 6 million declining entrepreneurs who are now carrying the most frightening and poisonous burden of evil parasites in the history of the US.
Now the parasites are not just feeding, they are killing the host.
The fucking stinking lying piece of corrupt shit, the faggot bum boy in the Whitehouse, is above all else the cheerleader to kill the SME's.
King parasite, he has the back of every other parasite in the US, whether murderous cops, corrupt judges or the thieving parking meter maid and especially the IRS.
Now I run a business and I still advise SME's
Except my advice now is how to quietly shut up shop, export your assets without paying exorbitant taxes, and start afresh but holding your clients or customers, and getting rid of the parasite and in so doing reduce your costs by around 60 to 70 % and pay no more fucking taxes to the US parasite culture.
And guess what,, business is booming.
With 10 years experience now we think the time has come.
This article is spot on, only half wits and wall street and bankster cunts will have you believe the US is booming. It has been dying for years and the second the great American Morons voted a Kenyan faggot monkey into the Whitehouse its fate was sealed
PS. If anyone thinks that the value of AAPL is really worth more than one million of the smallest businesses in the US they have nothing but shit between their ears. Valued on a proper basis it wouldn't be worth a fucking dollar a share.
The only reason the S&P is so fucking high is because the crony capitalists have the corrupt thieving parasites at their backs.
Where do you think the muneee comes from,
Yes from the parasites stealing from the SME's.
They will all die too as the host dies, and the feeding frenzy on SME's can only ever get worse as they rip into them and become another louse killing them off.
One hundred and thirteen trillion of gross debt and unfunded liabilities to be paid by just 6 million small businesses. The crony fuckers have share buybacks and ever recurring non recurring expenses to make sure they don't have to pay
Stated differently they all have a parasites necklace of one hundred and eighty eight million of liabilities each.
And the US is booming, hahahahaa
booming on fake ponzi freshly printed worthless dollars.
If you run a small business, save yourself, get out of there, Get the fuck out as fast as you can before its too late.
Well this was what the economy looked like before the booemr voting majority elected champs stuck up a lot of big red tape to protect them from competition. You can piss and moan all day about the late Reagan presidency, but the point of history is to learn from it and he got something VERY right. Tax cuts + Glass Stegall CREATES JOBS!!! Tax cuts got the rich to bring their dough back into the US and encourage them to invest it.
http://research.stlouisfed.org/fred2/graph/?s%5B1%5D%5Bid%5D=EMRATIO
Now the US has an investment DEFICIT.
Where are those Dim Sum and Panda bonds when you need them?
Why did Clinton purposely bust up the Multilateral Investment Agreement circa 1995 between the U.S. and China when he sold them a ton of US Treasuries to overleverage the corrupt politician power monopoly over the citizens of the U.S.?
Look at the red tape. If that mid-size corporation corporate tax rate was not enough (investors don't need the money after they sell their start ups to an M&A after pulling a debt to equity reval...) SOX is no replacement for Glass Stegall. Enron would not have been allowed to corrupt it's own if Glass Stegall was still law. SOX and some other red tape is stifling business creation.
http://money.usnews.com/money/blogs/risky-business/2008/07/17/sarbanes-o...
Back in 1996, there were 675 IPOs. IN 2012, there were 19? Nobody can count anymore I swear. Anyways.
What's killing the employment market is the economy. BUsinesses were not adequately warned of the upcoming subprime collapse. They had no idea that high gas prices and low oil prices that stiffed banks on petrodollar floating liquidity would excasberate the economy in the near months in 2007. They couldn't forecast this without that big important significan piece of information that was well hidden from them by the presstitutes and the real estate hyping "experts".
So when things fell, they fell hard. In LA, where people blow money like there's no tomorrow on $400 jeans just to show people that they have money- they were trying to save businesses and their mortgages. So they were shopping at the $.50 cent store. Not at Bristol Farms. A lot of companies either reduced greatly in size, leave or close up. Large companies were now mid sized companies. They were no longer "retail" but "branding"... they laid off a lot of people simultaneously so there was a saturated market of white collar professionals in a city with 9 strong universities, too many lawyers and unfriendly climate to business in the first place.... AND strugglign actors, the U-6 rate was up to 22% (it was probably higher). And the investors were suing them for losing their money, firms ie. Skadden (who didn't even call judges on misciting Judges on misquoting the Securities act of 1933-34 and failing to bust the banks for selling affluent investors counterfeit subprimes, they have a laundry list of cases that were wrongly dismissed).... Skadden and other corporate/securities lawyers were charging these now distressed companies to the tune of $20,000-$30,000/MONTH for protection from investors. Sometimes investors wanted too much money, note the debt to equity ratio.... again, that costs the company that much money per month for legal protection.
So how many in-house CPAs, MBAs and solid Sr. Accountants could you employ for $20,000-$30,000/month?
These accountants were no longer "in-house", they were contractors and temps. And the temps are not clued in that they were not complete fuck ups (yes accountants and even former Series 7 professionals who came from rich families were able to go into completely different fields ie. archetecture or pharmacy)...but that teh company needed to save face for the fact that they actually couldn't afford the accounting major with a 3.6 GPA. Or the tools at SpaceX were either hiring nepotistically or MBAs in Accounting for a stupid accounts payable position.
Deloitte has been famous for stiffing the unemployed and disabled on their insurance DURING THE HOLIDAYS (in 2012, yes this really happened). Notice how the presstards completely hid that story too.
BUT! They're gentrifying criminally run, crime ridden and violent Los Angeles and mugging people all of this money for a cheapo room in a shitty hood where investors buy up apartment complexes and rent out only one room at an excessive price.
Regardless... the Obama campaign counts jobs in the same way that Chicago and LA cops count the rate of violence in their cities (for political reasons- LA underreported 1200 and let violent criminals loose).
http://www.latimes.com/local/lanow/la-me-ln-lapd-data-20141216-story.html
http://articles.chicagotribune.com/2014-04-07/news/chi-report-chicago-po...
The data manipulators are psychotic homicidal sociopaths in both the police and unemployment sector. Notice the connections between Emmanuel and the ever so corrupt Chicago cops and the connection with Obama.
I don't care what the incentive motive is, you cannot overlook the corruption in these cases.... it's very severe and literally quite dangerous. In Chicago, they say, "The dead can't complain". Many suicides happened since the subprime collapse (and divorces) ... again, the dead can't complain. The dead don't have the tech to apparently.
this is the real story. from the first day of this revered supply side pee on the little guy and let it trickle down his leg economy of the last 35 years the oligarchs have also defecated all over the true small business of zero to twenty employees, the guys who don't know if their business will be there in the morning and have nothing to sell when it is over. this is not a rant about regulation, per se. the worst regulations are the barriers to entry a lot of regulations present that large companies lobbied for and count in pennies on the dollar while a small business counts the cost in dimes.
it is such a pain in the ass to run a legitimate business, especially one with marginally paid employees that i don't see why someone would volunteer to suffer the fate. the people who continue trying because that is what they know how to do are real heroes. there are pockets of investment in tech. guys are still trying to strike it rich with the right kernel of code. inventing stupid stuff apparently works too, if you believe shark tank.
the bottom line is, the risk reward is too far on the risk side and people are much more risk averse today. the combination means the walmartation of the world will continue like some sci fi drama in anime.
money used to be easy in this country.
not to worry
It doesn't matter whether or not the economy is truly coming back as long as everyone thinks it's ringing the front doorbell right now.
Or to quote Oscar
The US is no longer the land of opportunity; the cake has been carved leaving only a few crumbs for any new comers.
Nearly all the land is now earned by a few families; the big corporations now run all the businesses and it has formed its billionaire aristocracy who control Government for their own ends.
It is an empire in decline.
The dynamism of the American dream is no more.
Asia now comes into its ascendency where a new cake is up for grabs and newcomers are welcome.
The billionaire aristocracy of the US now owns your cake and has no intention of letting any of the pieces go.
It is the way of things, empires come and go; the UK was the global superpower 100 years ago.
Once the cake is carved the end is nigh.
For those who did miss the sayings of the next US president candidate...
It's not businesses that create jobshttp://onpolitics.usatoday.com/2014/10/25/hillary-clinton-its-not-busine...
Compared to Obamba's: "If you’ve got a business — you didn’t build that. Somebody else made that happen."
These stupidos are hard to comment.
Whatever passes for an innovative idea is typically another scheme for drawing eyeballs to advertisers. And the current innovator culture is to create an idea and get swallowed up by Google or Facebook.
Practically speaking, in the tech space it is next to impossible for a small business to compete when that is the predominant mindset.
Small business big business its all irrelevant the true rulers visit underground colonies on other planets! think they give a fuck bout your roofing biz hot dog stand, independent contractor schtick?! Ha shut your face and pay out your ass filthy whitey goy! pay far out that filthy goyim bunghole!
We you didn't build thated some folks."
Deficit spending is an ugly creature that infiltrates regimes run by cronyism. The Constitution protected against such behavior for a while. Not any more...
http://www.globaldeflationnews.com/the-principle-of-spending-money-to-be...