Posts Tagged ‘ economic collapse ’

10 Tipping Points Which Could Potentially Plunge The World Into A Horrific Economic Nightmare

The Economic Collapse
June 7, 2011

The global economy has become so incredibly unstable at this point that it is not going to take much to plunge the world into a horrific economic nightmare.  The foundations of the world economic system are so decayed and so corrupted that even a stiff breeze could potentially topple the entire structure over.  Over the past couple of months a constant parade of bad economic news has come streaming in from Europe, Asia and the United States.  Signs of an impending economic slowdown are everywhere.  So what “tipping point” will trigger the next global economic downturn?  Nobody knows for sure, but potential tipping points are all around us.

Today, the global economic system is even more vulnerable than it was back in 2008.  Virtually none of the systemic problems that contributed to the 2008 collapse have been fixed.

Mark Mobius, the head of the emerging markets desk at Templeton Asset Management, was recently was quoted in Forbes as saying the following….

“There is definitely going to be another financial crisis around the corner because we haven’t solved any of the things that caused the previous crisis.”

The “financial reform” law that Barack Obama and the Congress passed a while back was a complete and total joke.  They might as well have written the law on toilet paper for all the good that it is doing.

We did not learn from our mistakes and our future economic lessons are going to be even more painful.

The world is drowning in a mountain of debt, the global financial system is packed to the gills with toxic derivatives, everyone is leveraged to the hilt and the dominoes could start falling at any time.

I am not the only one that is warning that another financial collapse is coming.  In fact, a whole lot of people have been warning about the next financial collapse lately.

So what will the tipping point for the next collapse be?

The following are some potential nominees….

Tipping Point #1: Syria

Syria is a situation to watch very, very closely.  The Syrian government is in a lot of trouble right now.  Sadly, the instability inside Syria probably makes war with Israel even more likely.

Make no mistake – a war between Israel and Syria has been brewing for a long, long time and at some point it will happen.  When it happens, the entire Middle East may erupt in warfare.

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Just the other day, a very troubling incident happened in the area around the Golan Heights.  The following is an excerpt from a report by The Daily Mailabout the incident….

“About 20 pro-Palestinian demonstrators were killed and 325 injured yesterday when Israeli forces opened fire on them as they crossed the border from Syria into occupied territories, according to reports.”

At this point, the Syrian government is probably glad that the attention has been taken off of them at least for a while.  The Syrian government has been getting a lot of bad press lately.  The following is an excerpt from a recent report by Human Rights Watch about the treatment of protesters inside Syria….

“The methods of torture included prolonged beatings with sticks, twisted wires, and other devices; electric shocks administered with Tasers and electric batons; use of improvised metal and wooden ‘racks’; and, in at least one case documented by Human Rights Watch, the rape of a male detainee with a baton.

“Interrogators and guards also subjected detainees to various forms of humiliating treatment, such as urinating on the detainees, stepping on their faces, and making them kiss the officers’ shoes. Several detainees said they were repeatedly threatened with imminent execution.”

 

So in light of the “precedent” that we recently set in Libya, does this mean that we will be “forced” to conduct a “humanitarian mission” inside Syria as well?

Syria is one tipping point that we all need to keep a close eye on.

Tipping Point #2: Iran

The Iranian nuclear program is in the news again. A new report by RAND Corporation researcher Gregory S. Jones claims that Iran could have a nuclear weapon within 2 months.  His report is based on recent findings by the International Atomic Energy Agency.  According to Jones, airstrikes alone would be incapable of stopping Iran’s nuclear weapons program at this point.  Instead, Jones says that a “military occupation” would be required.

It is a minor miracle that a war with Iran has not erupted yet.  It seems almost inevitable that at some point either the United States or Israel will use military force to try to stop Iran’s nuclear program.

When that happens, it is going to cause a major shock to the global economy.

Tipping Point #3: Libya

NATO has made it abundantly clear that Moammar Gadhafi will no longer be tolerated.  In fact, NATO apparently plans to reduce Tripoli to a heap of smoking ruins if that is what it takes to bring about the fall of Gadhafi.

What a “humanitarian mission” we have going in Libya, eh?  It turns out that NATO believes that the United Nations gave it permission to bomb television stations and to make attack runs with helicopters.

Russian Deputy Prime Minister Sergei Ivanov recently said that by using attack helicopters, NATO has moved dangerously close to turning the Libya operation into a ground invasion….

“Using attack helicopters, in my view, is the last but one step before the land operation.”

So why is Libya a potential tipping point?

It isn’t because Gadhafi is a threat.  He is toast.

It is because the rest of the world is watching what is happening in Libya, and that is raising global tensions.

Even if Gadhafi falls, the Libyan operation will still be a failure because it has brought us all significantly closer to World War III.

Tipping Point #4: More Revolutions In The Middle East

The revolutions throughout the Middle East earlier this year sent oil prices absolutely skyrocketing and they have remained at elevated levels.

And in case you haven’t noticed, revolutions continue to sweep the Middle East.

Have you seen what has been happening in Yemen lately?

Yemeni President Ali Abdullah Saleh has burns over 40% of his body and he has suffered a collapsed lung as a result of a recent attack.

If violence and protests throughout the Middle East become even more intense as the weather warms up this summer that could have a very significant impact on world financial markets.

Tipping Point #5: Fukushima

The mainstream news has gotten a bit tired of covering it, but the situation at Fukushima is still a complete and total disaster.

Japan’s Nuclear Emergency Response Headquarters admitted on Monday that three reactors experienced “full meltdowns” in the aftermath of the earthquake and tsunami in March.

Did it really take them nearly three months to figure this out, or were they lying to the rest of the world all of this time?

The truth is that the nuclear disaster at Fukushima is far worse than the mainstream media has been telling us.  If you doubt this, just check out this excellent article or this article by Natural News: “Land around Fukushima now radioactive dead zone; resembles target struck by atomic bomb“.

The economic impact of the Fukushima disaster is going to continue to unfold over an extended period of time.  It turns out that Japan is now officially in a recession.  Their economy contracted at a 3.7 percent annualized rate during the first quarter.

Look for more bad economic numbers to come out of Japan for the rest of the year.  Considering the fact that the Japanese economy is the third largest economy in the world, the fact that they are struggling so badly right now is not a good sign for the rest of us.

Tipping Point #6: Oil Prices

The price of oil is going to continue to be one of the biggest economic stories for the rest of this year and for 2012 as well.

The last time U.S. energy expenditures were over 9 percent of GDP was in 2008 and we quickly plunged into the deepest economic downturn since the Great Depression.

Well, we have reached the significant 9 percent figure once again in 2011, and many fear that once again high oil prices will cause another major economic decline.

Tipping Point #7: Government Austerity

In the United States, it is not just the federal government that is drowning in debt.

All over America, there are state and local governments that are financial basket cases.

I don’t always agree with the time frames that Meredith Whitney puts out there, but she is absolutely correct that we are going to see a massive municipal bond crisis. The following is an excerpt from a recent report about Whitney’s predictions on CNN….

“Meredith Whitney is issuing a fresh warning to mutual funds, banks, and politicians: The state of state finances is far worse than what you think, or at least than what you’ve been willing to tell the investors and taxpayers who will eventually carry the burden.”

Many state and local governments are attempting to get their budgets balanced by making huge budget cuts.  But most of the time these austerity programs also include the elimination of a lot of government jobs.

UBS Investment Research is projecting that state and local governments will combine to slash a whopping 450,000 jobs by the end of next year.

So where will the half a million good jobs come from to replace all of those lost jobs?

Tipping Point #8: The European Sovereign Debt Crisis

Greece is just the tip of the iceberg in Europe.

Moody’s downgraded Greek debt again last Wednesday.  This time Moody’s downgraded Greek debt by three levels all the way down to Caa1.  At this point, the yield on 10-year Greek bonds is over 15 percent.

The EU has been going crazy trying to deal with the Greek debt crisis.  The truth is that a default by the Greek government would be absolutely catastrophic. If you do not understand the kind of chaos a Greek default would set off on world financial markets, just read this editorial.

But Greece is not the only major European nation with a massive debt problem.

The government of Ireland is already indicating that they may need another bailout.

Portugal, Spain and Italy are also on the verge of collapse.

So will the EU bail all of these nations out for years and years to come?

At some point will the whole house of cards come crashing down?

Everyone needs to keep watching what is going on in Europe.  The status quo is not sustainable and it cannot go on forever.

Tipping Point #9: The Dying U.S. Dollar

The euro is not the only major currency that is in trouble.

The U.S. dollar is also slowly dying.

On April 18th, Standard & Poor’s altered its outlook on U.S. government debt from “stable” to “negative” and warned that the U.S. could soon lose its prized AAA rating.

The sad truth is that faith in the U.S. dollar and in U.S. Treasuries is rapidly declining.  The mainstream news is not reporting on it much, but right now the Chinese are rapidly dumpingU.S. government debt.

As the dollar declines, so will the purchasing power of average Americans.  We are already seeing a tremendous amount of inflation in 2011.

But this is just the beginning.

A lot worse is going to be coming down the road.

Tipping Point #10: Drought

A lot of people that read my articles doubt that we will ever see a major global food crisis.

But one is coming.

It is just a matter of time.

Even now, many areas of the world are experiencing very serious droughts.  The following is from a recent  Bloomberg article….

Parts of China, the biggest grower, had the least rain in a century, some European regions are the driest in 50 years and almost half the winter-wheat crop in the U.S., the largest exporter, is rated poor or worse. Inventory is dropping 8.8 percent, the most in five years, Rabobank International says. Prices will advance 20 percent to as high as $9.25 a bushel by Dec. 31, a Bloomberg survey of 14 analysts and traders shows.

Are you concerned yet?

You should be.

But if you prefer some mindless pablum that will make you feel better, we have some of that for you too.

Larry Summers, the former director of the National Economic Council under Barack Obama, recently told CNBC the following….

“We definitely hit a slower patch, but I think the basic fact that the terrible financial strains we had are abating, remains in place, and I expect this recovery to continue for a substantial period of time.”

Does that make you feel better?

Larry Summers says that everything is going to be okay.

It would be great if Summers was actually right, but sadly he is not.

In fact, the worst economic times that America has ever seen are ahead.

The following is a brief excerpt from a recent interview with Dmitry Orlov about the coming economic collapse that was posted on shtfplan.com….

First you have financial collapse, which is basically the volume of debt that has to be taken on in order for the economy to continue functioning, cannot continue. We’re seeing that right now in Greece, we’re probably going to see that in Japan, we’re definitely at a point now in the United States where even if you raised the income tax to 100 percent, there’s absolutely no way of covering the liabilities of the U.S. federal government. So, we’re at that point now but the workout of the financial collapse is not all quite there. We don’t quite have a worthless currency but that’s in the works.

That, of course, is followed by commercial collapseespecially in a country like the United States that imports two thirds of its oil. A lot of that is on credit and if a little bit of that oil goes missing then the economy starts to fall apart because nothing moves unless you burn oil in the United States and, of course, a lot of goods that are sold everywhere are imported again, on credit.

When the U.S. dollar dies and our financial system collapses we are not going to be able to get all of the things that we need from the rest of the world so cheaply any longer.

That is going to cause fundamental changes inside the United States.

Right now, the economic news just seems to get worse and worse, but this is just the beginning.

What is eventually going to happen in this country is going to be so nightmarish that most Americans could not even imagine it right now.

So are our leaders doing anything to prepare for the coming economic crisis?

No, they are too busy with other things.

The big political news of the day was U.S. Representative Anthony Weiner finally admitting that he sent out lewd photos of himself over Twitter to women that he was not married to.

We have become the laughingstock of the world and the economic collapse has not even happened yet.

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50 Things Every American Should Know About The Collapse Of The Economy

The Economic Collapse
May 17, 2011

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 of 22 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 out five 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.

  • A d v e r t i s e m e n t

#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 jobs per 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.

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#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 spent over 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.

Knowledge Is Power: MUST SEE Popular Internet Video

OK, this video has been circulating on the internet for months now.  I know that it is long and it appears to be a long winded advertisement.  First and foremost understand I am not making any money off this video or this blog.  I believe that this is a powerful and informative video EVERY American needs to watch.  These really aren’t so much predictions anymore but the events described in this video are beginning to happen NOW! I believe in informing and warning people about dire events that have the potential to cause a devastating impact on the American economy so do not say that I haven’t tried to get the word out!

You can watch the video by clicking here!.