disaster – Page 3 – The Burning Platform

WTF CHART OF THE DAY

The chart below is simply horrifying. Not only are these median net worth figures scary, realize that 50% of the households in the country have less than these figures. Having a a net worth of less than $200,000 as you approach or enter retirement is a recipe for disaster. When 70% to 80% of that net worth is tied up in your house, you are nothing but a dead retiree walking. You should acquire a taste for cat food and learn how to panhandle for money.

The $25,000 to $45,000 of non-home related net worth would also include vehicles, furniture, electronics, and appliances. The amount of this net worth in usable cash or investments is microscopic. How can people expect survive for decades on virtually no savings? This chart reveals that a huge percentage of American households will face miserable retirement years and/or having to work until the day they die. They will have to sell their homes to live off the proceeds. Who will they sell to? You can see the younger generations don’t have a pot to piss in. This does not bode well for home prices over the next couple decades, despite the artificial boom engineered by the Fed and Wall Street since 2012.

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The unequivocal facts in that chart are the result of globalizing good jobs to foreign lands, the utter failure of our educational system, the success of Wall Street/Mega-Corporation propaganda in convincing a vast swath of America to live for today using easy money credit, politicians squandering the national wealth on the welfare/warfare state, and a Federal Reserve that has debased our currency by 96% in just over 100 years.

This chart will look even worse when the stock/bond/housing bubble implodes for the third time in the last sixteen years. We are sitting down to a banquet of consequences.

Macy’s Massacred After Slashing Outlook On “Uncertain Consumer” As Inventories Reach Record Highs

Wow!!

Who could have possibly seen this coming?

Oh Yeah. Me.

http://www.theburningplatform.com/2016/01/06/and-it-begins-2/

http://www.theburningplatform.com/2015/11/11/macys-imploding-catching-down-to-sears-penneys/

http://www.theburningplatform.com/2015/10/14/ignore-the-media-bullsht-retail-implosion-proves-we-are-in-recession/

http://www.theburningplatform.com/2015/08/15/department-store-results-imploding/

http://www.theburningplatform.com/2015/06/14/consumers-not-following-orders/

http://www.theburningplatform.com/2014/09/13/kohls-the-rest-of-the-retailers-are-in-deep-doo-doo/

http://www.theburningplatform.com/2014/05/25/retail-death-rattle-grows-louder/

http://www.theburningplatform.com/2014/04/15/why-retailers-are-closing-thousands-of-stores-summarized-in-one-chart/

Submitted by Tyler Durden on 05/11/2016 08:14 -0400

The retailer apocalypse continues this morning with Macy’s crashing almost 10% in the pre-market after missing top-line and slashing its outlook citing the “uncertain direction of consumer spending,” which seems odd given the confidence with which The Fed, Obama, and every talking head proclaims the US consumer’s health. Comp store sales plunged 6.1% (almost double expectations) and this comes at a time when clothing inventories are at an all-time record high relative to sales.

“We are seeing continued weakness in consumer spending levels for apparel and related categories. In particular, our sales trend relative to expectations meaningfully slowed beginning in mid-March, and first quarter results are below our original outlook. Headwinds also are coming from a second consecutive year of double-digit spending reductions by international visitors in major tourist markets where Macy’s and Bloomingdale’s are key destinations, as well as a slowdown in some center core categories – further intensifying the challenges associated with growing topline sales revenue,” said Terry J. Lundgren, Macy’s, Inc. chairman and chief executive officer.

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Dr. Allan Meltzer’s “Federal Reserve Failures” – Presentation at National Association of Realtors

Guest Post by AnthonyBSanders

Today, I had the privilege of attending a fantastic seminar at the headquarters of the National Association of Realtors by Carnegie-Mellon University economist Dr. Allan Meltzer. The topic? The Federal Reserve and Housing.

Here are portions of his speech.

Federal Reserve Failures
By Allan H. Meltzer

Recently, Stanford Professor John Taylor and I circulated a statement calling on Congress to require the Federal Reserve to choose and adopt a rule—a clearly stated way to make its decisions—that would permit anyone to know what they would do in the future. Our statement was signed by several Nobel Laureates with longstanding interest in and contributions to economic policy. A number of former Fed policymakers and senior staff signed the statement also. Earlier, the House of Representatives adopted the proposal. It could become law. I will forward a copy of the statement on request.

The future is of course obscure and, at times, subject to unpredictable changes. The proposed law permits the Fed to depart from its policy rule temporarily. And the proposed legislation does not impose a specific rule. The Fed chooses the rule it follows, but unlike the present, monetary policy is more disciplined and predictable.

The Federal Reserve has made many large errors in the past. Two well-known examples are the Great Depression of the 1930s and the Great inflation of the 1970s. Recently, the Fed contributed to the Great Recession in 2008 and following. Several recent errors are described here. (Like the policy error of rapidly lowering The Fed Funds Target Rate in 2001 (tech bubble crash) only to start rapidly raising it again in 2004 as home prices were skyrocketing. Adjustable rate mortgages and loans to subprime borrowers both rose rapidly starting in 2003 and home prices peaked as The Fed Funds Target rate peaked in June 2006. The rest is history after the peak).

–The Fed made massive purchases of housing securities to bail out the industry that produced the crisis. Former Chairman Alan Greenspan had warned against and ended purchases of government backed mortgages. The Bernanke-Yellen Fed ignored that advice.

Continue reading “Dr. Allan Meltzer’s “Federal Reserve Failures” – Presentation at National Association of Realtors”

THE OBAMACARE DISASTER ACCELERATES

Via Breitbart

UnitedHealth, America’s largest health insurance provider, says it will exit from most ObamaCare exchanges next year, citing more than $1 billion in losses.

CEO Stephen Hemsley says his company “cannot continue to broadly serve the market created by the Affordable Care Act’s coverage expansion due partly to the higher risk that comes with its customers,” as reported by the Associated Press.

The announcement came after UnitedHealth revised its projection for 2016 to $650 million in losses, up from a previous estimate of $525 million, after ending 2015 some $475 million in the red.

As the AP tells it, UnitedHealth had “second thoughts” almost immediately after announcing it would expand participation from four state exchanges to 34.

As of last November, the company was debating a complete exit from all ObamaCare exchanges, but has apparently decided to remain active in a “handful” of states, which Hemsley did not specify in his conference call to report company earnings. It has already been announced that the company was pulling out of Arkansas, Georgia, and Michigan.

The Washington Post cites a Kaiser Family Foundation study that estimated about 1.1 million ObamaCare customers would be left with a single insurance provider to “choose” from, if UnitedHealth withdrew from every ACA exchange. According to this analysis, “the impact could be significant in some areas, particularly in rural areas in Southern states.”

The Associated Press notes that some other big insurance players, such as Aetna, have reported heavy losses from the ACA exchanges, and are expected to “trim their exchange participation in 2017.”

“A dozen nonprofit health insurance cooperatives created by the ACA to sell coverage on the exchanges have already folded, and the survivors all lost millions last year,” the AP adds.

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Sales of Short-Term Health Plans Soar as Americans Flee Expensive Obamacare

Guest Post by Michael Krieger

When it comes to Obamacare, the devil is in the details.

As the years go by, Americans are quickly recognizing that not only is Obamacare not helping them out, it’s actually crushing their paychecks to such an degree they’re finding it necessary to pursue alternatives. This has resulted in a mad dash into non-ACA compliant short-term health insurance plans, or the kind of plans Obamacare was specifically designed to replace.

Before we get into that, it’s important to understand just how unaffordable and useless Obamacare actually is for millions of Americans. First, let’s revisit a few excerpts from last month’s post, The Health Insurance Scam – “Coverage” Doesn’t Mean Affordability or Access:

The Affordable Care Act hasn’t just caused premiums to skyrocket across the country, out-of-pocket costs are also on the rise.

According to Freedom Partners, an Arlington, Va.-based pro free-market non-profit, 41 states are facing higher deductibles in 2016 – 17 of which saw a double-digit hike.

“Higher Obamacare deductibles increase, by hundreds of dollars, what families must pay out of pocket to access their health insurance,”Freedom Partners Senior Policy Adviser Nathan Nascimento said in a statement. “Instead of reducing costs, Obamacare regulations and mandates continue to drive up these costs and make quality care less accessible for hardworking families.”

For some additional insight, let’s turn to a New York Times article published last year titled, Many Say High Deductibles Make Their Health Law Insurance All but Useless:

WASHINGTON — Obama administration officials, urging people to sign up for health insurance under the Affordable Care Act, have trumpeted the low premiums available on the law’s new marketplaces.

But for many consumers, the sticker shock is coming not on the front end, when they purchase the plans, but on the back end when they get sick: sky-high deductibles that are leaving some newly insured feeling nearly as vulnerable as they were before they had coverage.

“The deductible, $3,000 a year, makes it impossible to actually go to the doctor,” said David R. Reines, 60, of Jefferson Township, N.J., a former hardware salesman with chronic knee pain. “We have insurance, but can’t afford to use it.”

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Imploding Pensions Take The Rest Of US Down With Them

Guest Post by John Rubino

It’s the same story pretty much everywhere: Cities and states promised ridiculously generous (by today’s standards) pensions to teachers, cops and firefighters, failed to sufficiently fund the plans and invested the money they did have very badly. And now the weight of the resulting unfunded obligations are crushing not just plan recipients but entire communities. Here’s a representative case:

Oregon PERS unfunded liability swells to $21 billion

(KTVZ) – This week, Oregon’s Public Employee Retirement System Board received an earnings report on the status of the PERS fund investment. The report said Oregon’s PERS fund fell by 4 percent in 2015, a loss of nearly $3 billion — and a Central Oregon lawmaker said that means major reforms are more urgent than ever.“The blow to PERS from the Moro court case left Oregon with an additional $5 billion in unfunded liability,” Sen. Tim Knopp, R-Bend, said Tuesday. “Now PERS is an additional $8 billion short of its target.”

In that ruling nearly a year ago, the state Supreme Court overturned the vast majority of the PERS reform cost-saving provisions enacted by the 2013 Legislature.

The current unfunded PERS liability now exceeds $21 billion, up from $18 billion last year, he noted.

PERS Communications Director David Crossley said while the PERS fund earned just over 2 percent last year, it did not achieve the “assumed savings rate” of 7.75 percent, so the liability increased by about $3 billion.

He noted that PERS had positive earnings, but lost value because it pays out about $3.5 billion in benefits a year.

PERS rates for school districts and local governments will rise in July 2017, Knopp said, forcing school districts to lay off teachers, reduce school days, increase class sizes, and cut programs like art and PE. Local governments will also have to make cuts to public safety and other critical services.

This combination of worse-than-expected investment returns and legal barriers to cost savings is playing out across the country. See Fitch downgrades Chicago after “worst possible outcome” in state supreme court pension reform bid.

What follows — “…forcing school districts to lay off teachers, reduce school days, increase class sizes, and cut programs like art and PE. Local governments will also have to make cuts to public safety and other critical services” — is also playing out in most states and cities.

And this, remember, is at the tail end of an epic bull market in financial assets. If pension plans aren’t fully funded now, they’ll fall into an abyss in the coming correction.

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CBO Misses Its Obamacare Projection By 24 Million People

Submitted by Jeffrey Anderson WeeklyStandard.com,

Three years ago, on the eve of Obamacare’s implementation, the Congressional Budget Office (CBO) projected that President Obama’s centerpiece legislation would result in an average of 201 million people having private health insurance in any given month of 2016. Now that 2016 is here, the CBO says that just 177 million people, on average, will have private health insurance in any given month of this year – a shortfall of 24 million people.

Indeed, based on the CBO’s own numbers, it seems possible that Obamacare has actually reduced the number of people with private health insurance. In 2013, the CBO projected that, without Obamacare, 186 million people would be covered by private health insurance in 2016—160 million on employer-based plans, 26 million on individually purchased plans. The CBO now says that, with Obamacare, 177 million people will be covered by private health insurance in 2016—155 million on employer-based plans, 12 million on plans bought through Obamacare’s government-run exchanges, and 9 million on other individually purchased plans (plus a rounding error of 1 million).

In other words, it would appear that a net 9 million people have lost their private health plans, thanks to Obamacare—with a net 5 million people having lost employer-based plans and a net 4 million people having lost individually purchased plans.

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Thanks Obamacare: This Is What Americans Spent Most Money On In 2015

Submitted by Tyler Durden on 03/25/2016 09:46 -0400

We have been covering the consumption tax, pardon, endless spending black hole that is Obamacare for over a year, so we doubt it will come as a surprise to anyone that in 2015 healthcare was the second biggest use of US consumer funds, soaking up a record $1.9 trillion in real dollars, and more importantly for US economic “growth”, the single biggest source of incremental spending by nearly a factor of two.

Incidentally, with spending on healthcare (courtesy of the Supreme Court’s Obamacare tax) soaring, while outlays on the traditionally most consumption-intensive category, housing and utilities, going nowhere for the past several years, it is only a matter of 2-3 quarters before Healthcare surpasses Housing as the biggest use of American cash.

Putting this in context, a recent report from Freedom Partners Health found that health insurance premiums have increased faster than wages and inflation in recent years, rising an average of 28 percent from 2009 to 2014 despite the enactment of Obamacare, or rather “because of.” Obama signed the Affordable Care Act into law on March 23, 2010, and Wednesday is the law’s sixth anniversary.

So, without further ado, this is what drove American consumer spending in the officially concluded, for GDP purposes, 2015. We show this just in case there is still any confusion why US households are unable to channel more spending into “discretionary”, non-mandatory purchases unlike Obama’s “health insurance” tax, pardon, noble venture.

7 Obamacare failures that have hurt Americans

Guest Post by Diana Furchtgott-Roth

The Affordable Care Act never would have been passed had Congress known how it would develop

Obamacare barely passed Congress in 2010. If people had known how it would develop, the health-care act would likely never have become law.

Back in 2009, when the law was proposed, and in 2010, when it was signed, the Affordable Care Act’s (ACA) proponents were giddy with optimism. Proponents proclaimed the many promises of Obamacare. Millions of people would be enrolled by 2016. The number of uninsured would decline dramatically. Health-care costs and premiums would drop. Everyone would have coverage. The federal deficit would decrease. Of course, as President Obama promised, everyone would be able to keep their plans and their doctors.

The truth has turned out to be very different. That’s why all Republican candidates say they want to repeal the program. Here are seven things about Obamacare that turned out to be very bad.

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Free Health Care in Nova Scotia

Guest Post by Rob in Nova Scotia

Just thought I’d give you folks in States a look at what Free Health Care looks like. Over the years the one constant in being Canadian is the boast that health care is free and universal. The statement is half-true. It is only universal, free it isn’t. In my province year over year budget increases have been well over and above rate of inflation. The Health Budget is getting squeezed each progressive year but Governments have been able to paper over the cracks. Well it looks like the days of papering over the cracks has come to an end.

There is a limit to what can be done when wage increases and equipment purchases gobble up more and more of the money each year. What ends up happening is health care budgets cut the only place they can. Maintenance is easy place to start and health administrators know that if they neglect building long enough they will get a new one. This is the Premier Hospital in my Province and sad indictment of what our once proud boast has become. Responsible households have to set aside money for upkeep. Not governments though! It’s tear it down and get a new one. All one needs is an understanding bank and a cash advance on shiny new credit card. It’s no wonder this province is broke.

Maintenance Inaction

by BillTurpin

1. Victoria General Hospital, Halifax NS

Above: In January, a woman from Edmonton was in the VG for four days to donate a kidney. She described the conditions there as “third world”. So Turpin Laboratories had a look during the first week of February. Our researchers confined themselves to public spaces on just a few floors. No patients or staff were disturbed, or even noticed our team. By way of further context, note that in 2011 the NDP government announced that planning had begun for a new building. Last month, four years later, the Liberals also announced that planning had begun. And Turpin Labs has reason to believe Capital Health actually SUBMITTED a rebuilding plan to the Health Department in 2009. Where is it today? We bet the new convention centre will open before you ever see that plan.

2. Entrance to Centennial Building, VG

Above: OK. It needs paint. No big deal unless it’s typical, right? Turpin Labs is familiar with five Nova Scotia hospitals. Medical staff at the VG have been the best from a patient point of view — professional, accessible and attentive. But maintenance at the VG is by far the worst. Cape Breton Regional, often criticized in this respect, sparkles by comparison.

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Life, Liberty, and the Pursuit of Health Insurance

Guest Post by Stilton Jarlsberg

obama, obama jokes, political, humor, cartoon, conservative, hope n' change, hope and change, stilton jarlsberg, obamacare, health insurance, blue cross, hell

I’m aware that people come to Hope n’ Change for a pithy analysis of the news rather than to hear my personal woes, so let me handle the headlines first: “smoking gun” emails from Hillary have been revealed that show she committed felonies. She will get away with them. An angry Muslim shot a policeman multiple times in the name of Allah because police enforce non-Shariah laws. Authorities assure us this had nothing to do with Islam. And finally, tomorrow will be Barack Hussein Obama’s final “State of the Union” speech, and he will tell not an iota of truth.

Aaaaaaand that’s the news. And now to turn to the lighter side…

And when I say “lighter” it’s because I wish I was currently holding one under a bong filled with weapons-grade hashish to dull my current Obamacare-inflicted woes.

On Saturday, I received a phone call from daughter Jarlsberg (in her 20’s), who was upset because she’d gone to the pharmacy to pick up her epilepsy medications (important, right?) and had her spanking new insurance card rejected at the cash register because the policy had been “terminated.” Rather than immediately go into seizures, she paid cash for the prescriptions at the uninsured price – over $300 which she doesn’t have to spare.

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Germany’s Refugee Crisis is Starting to Explode

Guest Post by Martin Armstrong

The Arab sexual assault in Cologne, Germany, occurred on New Year’s Eve when hundreds of male refugees robbed and carried out sexual assaults against over 100 girls. This illustrates one of the huge problems with allowing such a mass migration of a starkly different culture.

But what has become the BIG NEWS, is the cover-up by the major news in Germany who did not publish the story for three days. On January 6th, Denmark began “temporary” passport checks on the German-Danish border. The attempt to cover-up the Cologne attacks with one-third being sexual, has sent a shock-wave in Europe behind the headlines. The temporary passport checks in Denmark is a clear response to Germany’s unprecedented acceptance of refugees who a portion are not quite ready for Western living. The men involved were said to be Syrian.

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Huge Fukushima Cover-Up Exposed, Government Scientists In Meltdown

Submitted by Sean Adl-Tabatabai via InvestmentWatchBlog.com,

Fukushima radiation just off the North American coast is higher now than it has ever been, and government scientists and mainstream press are scrambling to cover-up and downplay the ever-increasing deadly threat that looms for millions of Americans.

Following the March 2011 meltdown at Japan’s Fukushima Daiichi nuclear power plant, reactors have sprayed immeasurable amounts of radioactive material into the air, most of which settled into the Pacific Ocean. A study by the American Geophysical Union has found that radiation levels from Alaska to California have increased and continue to increase since they were last taken.

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WHEN THE SHEET HITS THE PLAN

Guest Post by Stilton Jarlsberg

obama, obama jokes, political, humor, cartoon, conservative, hope n' change, hope and change, stilton jarlsberg, obamacare, blue cross

Not long ago we reported on the absolutely nightmarish process of trying to get a new insurance policy through Healthcare.gov after Blue Cross Blue Shield killed our existing plan and – in a letter to the medically homeless – specifically blamed Obamacare.

But we eventually did get a crappy, overpriced HMO policy on Healthcare.gov, and on Monday our proof of insurance cards arrived. Which is when the trouble started.

The two cards (one for each of the senior Jarlsbergs) had the names of two different PCP physicians on them (in an HMO, your “PCP” is the alleged doctor who becomes the gateway to either allow or deny all other healthcare services). Despite the fact that we’d named another doctor during the application process – indeed, we were required to pick a doctor – the new physicians were complete strangers whose names indicated they “weren’t from around here,” nudge-nudge wink-wink.

A quick online search showed that both doctors had pretty dismal reputations. One of them only had office hours two days a week, and only for five hours each of those days. Good luck getting an appointment! The other doctor required a 45-minute drive and ran a combined “family practice and low-cost lasik surgery” center in a strip mall.

A panicked call to Blue Cross put us on hold for 50 minutes before ever speaking to a human. Finally, we were told that we could absolutely change our PCP doctors because the ones shown on our cards were “dummy doctors.”

Say what?!

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Retail Sales: It’s Going To Be A Slaughter

Guest Post by Investment Research Dynamics

The Goldman Sachs ICSC chain store sales plunged 6.3% for the week ending December 5 (measured through Saturday each week). The index measures same-store sales for retail chains. A small decline is expected, as this is the week that follows Black Friday week. But I pulled up the data from last year and the same metric declined only 1.8%. And, in 2013 chain store comp sales actually rose 1.5% for the week following Black Friday week.

The economy is collapsing. This is evident from the ongoing crash in commodities, especially the price of oil and natural gas. The consumer is tapped out. There’s a law of economics called the Law of Diminishing Returns. It says that if one input in the production of a commodity is increased while all other inputs are held fixed, a point will eventually be reached at which additions of the input yield progressively smaller, or diminishing, increases in output.

Traditionally this law would apply to production and manufacturing. But in an economy based on the digital printing press, this law applies to money printing and credit creation. At a certain point, the ability of money printing and credit creation reaches a limit at which it can no longer stimulate consumption. Consumption of homes, cars and discretionary purchases.

Retail sales this holiday season will reflect this law as it applies to retail spending. We’ve already seen credit card data from Bank of America that indicates a 10% drop in spending for the November holiday season for through the first three weeks. Goldman’s chain store sales indicator reinforces this stunning fall-off in holiday spending.

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