Maybe the 2008 financial collapse was only the beginning. We’re much worse off now than we were then. Debt has increased significantly, as has credit creation. Nobody knows for sure how much money the Federal Reserve has printed and deposited in banks just to keep them solvent; some say $12 trillion, other estimates are $16 trillion. Japan keeps printing money like there’s no tomorrow, and China has created the mother of all credit bubbles.
It’s going to end badly, as everyone knows. We’re the cleanest shirt in the shithouse right now, but as we’ve already seen this year, stocks can crash at a moments notice. Sooner or later, that magical thing called trust is going to evaporate. Trust that the U.S. can or even wants to repay it’s $17.3 trillion dollar debt. That money back by nothing more than Federal Reserve promises and treasury IOU’s is really worth something. It’s all a house of cards, and it’s starting to crumble in the periphery.
But you’d never know it watching the financial MSM. It seems to me, the louder they keep saying “everything is fine, we’re in a recovery”, the worse it really is. The MSM is bought and paid for by our owners, and they see what’s happening globally. I expect a fevered pitch pretty soon, mouthpieces everywhere spouting off about our recovery, and “don’t worry, be happy”. Plan and prepare accordingly.
This article reprinted in full with permission of it’s author
Guest Post by Michael Snyder
If you have been waiting for the “global economic crisis” to begin, just open up your eyes and look around. I know that most Americans tend to ignore what happens in the rest of the world because they consider it to be “irrelevant” to their daily lives, but the truth is that the massive economic problems that are currently sweeping across Europe, Asia and South America are going to be affecting all of us here in the U.S. very soon.
Sadly, most of the big news organizations in this country seem to be more concerned about the fate of Justin Bieber’s wax statue in Times Square than about the horrible financial nightmare that is gripping emerging markets all over the planet. After a brief period of relative calm, we are beginning to see signs of global financial instability that are unlike anything that we have witnessed since the financial crisis of 2008. As you will see below, the problems are not just isolated to a few countries. This is truly a global phenomenon.
Over the past few years, the Federal Reserve and other global central banks have inflated an unprecedented financial bubble with their reckless money printing. Much of this “hot money” poured into emerging markets all over the world. But now that the Federal Reserve has begun “tapering” quantitative easing, investors are taking this as a sign that the party is ending. Money is being pulled out of emerging markets all over the globe at a staggering pace and this is creating a tremendous amount of financial instability. In addition, the economic problems that have been steadily growing over the past few years in established economies throughout Europe and Asia just continue to escalate.
The following are 20 signs that the global economic crisis is starting to catch fire…
#1 The unemployment rate in Greece has hit a brand new record high of 28 percent.
#2 The youth unemployment rate in Greece has hit a brand new record high of 64.1 percent.
#3 The percentage of bad loans in Italy is at an all-time record high. Italy just implemented capital controls, including a 20% tax on all incoming wire transfers.
#4 Italian industrial output declined again in December, and the Italian government is on the verge of collapse.
#5 The number of jobseekers in France has risen for 30 of the last 32 months, and at this point it has climbed to a new all-time record high.
#6 The total number of business failures in France in 2013 was even higher than in any year during the last financial crisis.
#7 It is being projected that housing prices in Spain will fall another 10 to 15 percent as their economic depression deepens.
#8 The economic and political turmoil in Turkey is spinning out of control. The government has resorted to blasting protesters with pepper spray and water cannons in a desperate attempt to restore order.
#9 It is being estimated that the inflation rate in Argentina is now over 40 percent, and the peso is absolutely collapsing.
#10 Gangs of armed bandits are roaming the streets in Venezuela as the economic chaos in that troubled nation continues to escalate.
#11 China appears to be very serious about deleveraging. The deflationary effects of this are going to be felt all over the planet. The following is an excerpt from Ambrose Evans-Pritchard’s recent article entitled “World asleep as China tightens deflationary vice“…
China’s Xi Jinping has cast the die. After weighing up the unappetising choice before him for a year, he has picked the lesser of two poisons.
The balance of evidence is that most powerful Chinese leader since Mao Zedong aims to prick China’s $24 trillion credit bubble early in his 10-year term, rather than putting off the day of reckoning for yet another cycle.
This may be well-advised for China, but the rest of the world seems remarkably nonchalant over the implications.
#12 There was a significant debt default by a coal company in China last Friday…
A high-yield investment product backed by a loan to a debt-ridden coal company failed to repay investors when it matured last Friday, state media reported on Wednesday, in the latest sign of financial stress in China’s shadow bank sector.
#13 Japan’s Nikkei stock index has already fallen by 14 percent so far in 2014. That is a massive decline in just a month and a half.
#14 Ukraine continues to fall apart financially…
The worsening political and economic circumstances in Ukraine has prompted the Fitch Ratings agency to downgrade Ukrainian debt from B to a pre–default level CCC. This is lower than Greece, and Fitch warns of future financial instability.
#15 The unemployment rate in Australia has risen to the highest level in more than 10 years.
#16 The central bank of India is in a panic over the way that Federal Reserve tapering is effecting their financial system.
#17 The effects of Federal Reserve tapering are also being felt in Thailand…
In the wake of the US Federal Reserve tapering, emerging economies with deteriorating macroeconomic figures or visible political instability are being punished by skittish markets. Thailand is drifting towards both these tendencies.
#18 One of Ghana’s most prominent economists says that the economy of Ghana will crash by June if something dramatic is not done.
#19 Yet another banker has mysteriously died during the prime years of his life. That makes five “suspicious banker deaths” in just the past two weeks alone.
#20 The behavior of the U.S. stock market continues to parallel the behavior of the U.S. stock market in 1929.
Yes, things don’t look good right now, but it is important to keep in mind that this is just the beginning.
This is just the leading edge of the next great financial storm.
The next two years (2014 and 2015) are going to represent a major “turning point” for the global economy. By the end of 2015, things are going to look far different than they do today.
None of the problems that caused the last financial crisis have been fixed. Global debt levels have grown by 30 percent since the last financial crisis, and the too big to fail banks in the United States are 37 percent larger than they were back then and their behavior has become even more reckless than before.
As a result, we are going to get to go through another “2008-style crisis”, but I believe that this next wave is going to be even worse than the previous one.
So hold on tight and get ready. We are going to be in for quite a bumpy ride.
Maybe?
Nah, a day of reckoning delayed is not a pass.
The dark houses, businesses, continue to silently grow.
The number of citizens – worldwide – that are experiencing a downturn in income (as the elite get more elite), is exploding in percentage. If you seek out the world’s press, instead of relying on Yahoo and Facebook and the MSM, it isn’t only Americans that are experiencing under-reported – or out of control and trying to be stifled – inflation and loss of valuation in currency. Alan and Benny should be hauled before tribunals for that alone.
The sheer cost of our mandated (tax, insurance, licenses, fees, permits, etc) costs continue to explode while our mandatory expenses do the same. I don’t care what they base the inflation rate on, it seems that everybody, except my cell carrier, is raising their fees, regulatory fees, interest rates, or they are shrinking or reducing the terms/sizes, or both. A can of peaches from 1 year ago yields more than today’s, and I know that five years ago the yield was even higher.
Anyone else remember 1 lb potato chips? or bread with 5 ingredients? or enough cereal to feed a couple teens for more than a couple days?
Poisoned, intentionally dumbed down, now regulated and controlled, all leading to early demise for millions of us. No different than Hitler, or Stalin, or Mao, or Baby Doc, our leaders have just put in place a long-term plan to make us stupid and sick then have us kill ourselves trying to pay for the “cures,” or losing our jobs instead of rounding us up and killing us openly. Most close their eyes, even as our body count grows, even as the atrocities we are forced to deal with – and we ain’t seen nothing yet, tanks and drones and riot gear for even small departments, once you own a tool you just simply have to use it – increase in frequency, and the obvious lying and omitting of the MSM, and the stress and fear and smaller paychecks, the human sheeple freaking flat out REFUSES to see past their pre-conceived notions and demand change. From the local city hall – which is where I truly believe we all should start – to the halls of CONgress, we should vote the vested interests out, vote in people that SWEAR under penalty of incarceration, to vote to overturn the Supremes bullshit rulings, break the ties of the corporate lobbyists by criminalizing their behavior, and vote in term limits. That wouldn’t fix everything but it would give us a fighting chance.
But I just don’t see enough people that do not benefit from kicking the can, to stand up and band together to tell the fucking truth about how bad we actually have it.
I get the feeling when the tide changes and the US dollar is more irrelevant (which if history is to be my guide, always happens eventually), we won’t even wake up then. Just freak out. Our dollar, hell, our country, is becoming more of a joke, more of a cartoon, more of a menace to the world, everyday. Meanwhile the Fed prints and prints handing out Benny Bucks to rich friends, CONgress spends and spends and spends, and our productive economy continues to protect a handful while sacrificing the rest of us as our research and tech follow the production (and the more valuable money)
I know Snyder thinks that China’s maneuvering will be a tipping point, I do, too, but with a caveat. I also believe that China has the Western world by the short hairs and our hubris – and the elected officials/bureaucrats – isn’t allowing an accurate picture of just how dependent we are.
As an American manufacturer, I’ve kept my eyes on the “made in” labels. Those labels – which are on everything from our toothpaste, to our medicines, to our bolts – have turned foreign.
Or if the package says, ‘distributed by” with no “made in” designation, it usually (8 or 9 out of 10) means that it is made outside our borders.
Now realize that even things that state, “made in America” have become, but not stated, assembled from foreign goods. The rule (basically, some items/industries may have different rules) states that if a product’s American cost is greater than 50% of the total costs, then it can be labeled as Made in America. Sometimes the packaging is what qualifies a product as American made.
If China decides to dramatically slow production, raise prices, and continue hoarding real assets and friendships with natural resource heavy countries (unlike us, we just bomb their asses into submission, how very democratic of us), what would we do?
What would happen to millions of us if the insulin production drops 25%? 50%? more?
Or ammo, or nails, or shingles or freaking fish.
We have run ALL the real business out of this country. Between the unions, the local gubments, the states, counties and federal. The lawsuits, safety the business is responsible for the idiots.
And still we have people like Freelander (he really burned my butt too), that think they are owed something, that humans should not have to compete and that by enabling gubment to steal from the poor and give to the rich, that some Utopia will be found.
Wow, struck a nerve I guess.
The “modern” world is slowly unraveling. Most will chose to follow the propaganda and line up for their doses of poison and poisoned “food” type products. As long as The Walking Dead, and Honey Boo Boo is on, and they can tell everyone on FB about it, they will bleat along, get sick, get poor (or start that way) and die when some drone tells them they are out of options.
We are screwed seven ways from Sunday. I’ve decided to try and get right with the universe, prepare as best I can for the worst, and find some comfort, fun and happiness while it is still ours to have.
I fear that these days will still be the good ole’ days, and frankly, they suck.
Thanks for all your posting AWD, I’m enjoying it.
The USA is a toxic environment for businesses. I’m trying to move mine out of the country. Every time I try to get ahead, some stupid fee, permit, or license is needed. The government constantly throws roadblocks in my way to protect big corporations & drive out competition. Fascism will kill the tax base, inflation & debt will kill consumption.
TeresaE, that was awesome, maybe you should start submitting articles?
Gas here is $3.55, diesel is $4.29, food is more expensive, the general cost of living is more expensive. The solution it seems is a rise in the federal minimum wage to $10.10 per hour.
Which will create a cry to raise minimum wage for all, which will create a cry for those at $11.00 or $12.00 to demand a raise as well, which will cause small business to raise their cost to the consumer.
Which is really a stroke of fucking genius in an election year. We will receive a tax increase by demanding the government force small business to pay employees more. Win win for those we elected to represent us.
Wow. Between Snyder’s article, AWD’s comments, and TeresaE’s comments …. what’s left to say? I’ll try.
The list of failing countries does not include Austria. Let’s all move there.
TeresaE said — ” I also believe that China has the Western world by the short hairs …” Probably right, but it works BOTH ways. If I, Stucky, owes TeresaE One Million dollars, she may very well have me by the short hairs …. but, I got her too! This may sound stupid, but I think every debtor nation has each other by the short hairs.
Obviously if a major economy goes down, everyone is fucked. But, it’ll probably be a little country like Greece or Portugal who is the straw that breaks the camel’s back. Nobody knows which one it will be.
I’m wondering if it all comes down to who can afford to lose the most, wins.
I still don’t see how the dollar is supposed to weaken against foreign currencies with all that global unemployment?
As hard as the Fed is trying to devalue the dollar and make old debts payable. Foreign currencies can’t strengthen because that would collapse their exports and destroy their jobs. Especially, in moments of social strife. Those countries would rather have domestic inflation rather then a full born depression due to a collapse in exports and an inability to repay foreign debt due to a collapse of exports. Which would create a run on their currencies any way.
How much domestic inflation those countries would like to incur to preserve export jobs is the question?
@Teresa E. : Please think seriously about Card802s’ comment. Think seriously about writing some short articles for TBP from your point of view of working for a manufacturing outfit..
I enjoy all your comments – and would enjoy articles too.
MA