Tag Archives: Unemployment

The Fed Balance Sheet: What is Uncle Sam’s Largest Asset?

The Fed Balance Sheet:
What is Uncle Sam’s Largest Asset?

By Doug Short

Note from dshort: I’ve updated the quiz based on yesterday’s Q1 Flow of Funds release. Hint: The correct answer is the same, just more incredible.

Pop Quiz! Without recourse to your text, your notes or a Google search, what line item is the largest asset on Uncle Sam’s balance sheet?

A) U.S. Official Reserve Assets
B) Total Mortgages
C) Taxes Receivable
D) Student Loans

The correct answer, as of the latest Flow of Funds report for Q1 2012, is … Student Loans.

The College Conspiracy

The rapid growth in student debt has been a frequent topic in the financial press. One stunning chart that caught my attention illustrated the rapid growth in federal loans to students since the onset of the great recession. Here is a chart based on data from the Flow of Funds Table L.105, which shows the Federal Government’s assets and liabilities.


As I point out on the chart, the two callouts are for Q4 2007, the quarter in which the Great Recession began (December 2007) the most recent quarter on record, Q1 2012. The loan balance has risen and astonishing 332% over that timeframe, most of which dates from after the recession.

This chart only includes federal loans to students. Private loans make up an even larger amount. Earlier this year the Consumer Financial Protection Bureau (CFPB) posted an article with the attention-grabbing title: Too Big to Fail: Student debt hits a trillion. The details of the private student loan market are not readily available, but CFPB plans to publish its study results on the topic this summer.

Again. What line item is the largest asset on Uncle Sam’s balance sheet?

A) U.S. Official Reserve Assets
B) Total Mortgages
C) Taxes Receivable
D) Student Loans

But back to our quiz. Student loans may be a liability on the consumer balance sheet, but they constitute an asset for Uncle Sam. Just how big? Nearly 35% of the total federal assets, over four times the 8.6% percent for the total mortgages outstanding.

Of course, assets are, sadly, the trivial side of Uncle Sam’s Flow of Funds balance sheet — about 1.36 Trillion. The liability side totaled 12.65 Trillion at the end of Q1 (details here).

Student loan debt is something we’ll want to continue watching, especially when more details of the private loan market becomes available.

Footnote: For those who wonder how much the pie chart above differs from the Q4 2011 version, here’s the previous version, based on the data reported in the March 8, 2012 release.

Remember, if you have a question or comment, send it to [email protected]
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SOURCE

Hallmark Now Selling Unemployment Sympathy Cards

Hallmark Now Selling Unemployment Sympathy Cards

Carol Cavazos

DALLAS (CBSDFW.COM) – Call it another sign of our difficult economic times: Hallmark has taken a cue from the nation’s 9.1 percent unemployment rate and released a line of cards for people who’ve lost their jobs.

Caring or insulting?

It’s says something about the economy I suppose. But it also says something about that folks are still loving and caring and want to encourage folks along the way,” Emily Louis said.

Louis was in a Dallas Hallmark store looking for a birthday card.

Asked if she would give someone who lost a job one of the new cards, she said, “Yeah, I think I would.”

Frank Fernandez, who owns Monica’s Hallmark in Dallas, said, “The cards are flying off the shelves.”

Call it caring with a twist. The kind that tells you, “When life gives you a lemon, go ahead and make a martini with it,” as one so boldly suggests.

Suzanne Sheafer was in Monica’s Hallmark with her nine-year-old daughter Kaylie.

Asked what she thought about the job loss cards, Sheafer said, “Nowadays everybody’s always doing email or other things and I think when you get a card in the mail it’s that extra touch that you know someone went the extra mile.”

So what is the protocol? How soon should you give someone who’s lost a job a card? More importantly when is it too late?

It seems to me like within a couple of days you should be able to address the question,” Frank Fernandez said. “Because you’re basically trying to make the people forget about what happened and focus on what’s ahead.”

Fernandez was a sales representative for a Fortune 500 company in 1994 when he lost his job.

“We can all relate to it,
” he said.

Fernandez was without a job for a whole year. And though he never got a card, he got the message about life lemons.

“I lost my job,” he said. “But, that’s how I ended up owning Hallmark stores.”

SOURCE

The Mad As Hell Generation

The Mad As Hell Generation: 20 Reasons Why Millions Of Americans Under The Age Of 30 Are Giving Up On The U.S. Economy

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Courtesy of The Economic Collapse Blog

Millions upon millions of young Americans have completely lost faith in the U.S. economy and are mad as hell that their economic futures have been destroyed. The recent economic downturn has hit those under the age of 30 the hardest. Today, there are hordes of young people that should be entering their most productive years that are sitting home with nothing to do. Many of them have worked incredibly hard throughout high school and college. Many of them have stayed out of trouble and have done everything that “the system” asked them to do. But once they got finished with school, the promised “rewards” simply were not there. Instead, millions of young Americans are faced with crushing student loan debt loads in an economy where they can’t find good jobs. When you are in your twenties, it can be absolutely soul-crushing to send out hundreds (or even thousands) of resumes and not get a single interview. Most of us grew up believing that we would “be something” when we got older, and millions of young Americans are having those dreams brutally crushed right now. Americans under the age of 30 voted for Barack Obama in droves back in 2008 because they believed that he would make things better. Instead, Barack Obama has made things even worse. Significant numbers of young Americans are starting to wake up and realize that neither political party is providing any real answers, and they are starting to get mad as hell about it.

Americans under the age of 30 don’t want to hear that they are not going to be able to do better than their parents. They don’t want to hear that they are going to have to “pay the price” because of the mistakes of previous generations. They don’t want to hear that the “good jobs” that have been held out as a “carrot” for them all these years have disappeared and are not coming back.

Millions of young Americans want what was promised to them. They want good jobs that will enable them to enjoy the “American Dream”. They want things to go back to the way that things used to work in America.

If you spend much time around those in their twenties, you know that many of them have a look of hopelessness in their eyes. Large numbers of them have moved back in with their parents. Large numbers of them are flipping burgers or working retail jobs part-time because that is all they can find. There are even a growing number of them that have given up entirely and have completely checked out.

So are we in the process of creating a “lost generation”?

The following are 20 reasons why millions of Americans under the age of 30 are giving up on the U.S. economy….

#1 Only 55.3% of Americans between the ages of 18 and 29 were employed last year. That was the lowest level that we have seen since World War II.

#2 Today, there are 5.9 million Americans between the ages of 25 and 34 that are living with their parents.

#3 The economic downturn has been particularly tough on men. According to Census data, men are twice as likely to live with their parents as women are.

#4 Amazingly, less than 30 percent of all U.S. teens had a job this summer.

#5 Approximately one out of every five Americans under the age of 30 is currently living in poverty.

#6 According to one recent survey, only 14 percent of all Americans that are 28 or 29 years old are optimistic about their financial futures.

#7 Since the year 2000, incomes for U.S. households led by someone between the ages of 25 and 34 have fallen by about 12 percent after you adjust for inflation.

#8 The cost of “getting an education” has become increasingly burdensome in recent years. Average yearly tuition at U.S. private universities is now up to $27,293. That figure has increased by 29% in just the past five years.

#9 In America today, approximately two-thirds of all college students graduate with student loans.

#10 Millions of young Americans are absolutely being financially strangled by horrific student loan debt loads. Sadly, the total amount of student loan debt in the United States now exceeds the total amount of credit card debt in the United States.

#11 In 2010, the average college graduate had accumulated approximately $25,000 in student loan debt by graduation day.

#12 One-third of all college graduates end up taking jobs that don’t even require college degrees.

#13 In the United States today, there are more than 100,000 janitors that have college degrees.

#14 In the United States today, 317,000 waiters and waitresses have college degrees.

#15 In the United States today, approximately 365,000 cashiers have college degrees.

#16 In the United States today, 24.5 percent of all retail salespersons have a college degree.

#17 As the economy has crumbled, fewer young Americans have been getting married. Today, an all-time low 44.2% of Americans between the ages of 25 and 34 are married.

#18 Young Americans are becoming increasingly frustrated as our politicians stand by and do nothing while our economy is being hollowed out. The sad truth is that United States has lost an average of 50,000 manufacturing jobs a month since China joined the World Trade Organization in 2001, and top politicians in both major political parties keep pushing for even more job-killing “free trade” agreements.

#19 Young Americans are becoming increasingly frustrated that pretty much the only jobs that seem to be available are low paying jobs. Back in 1980, less than 30% of all jobs in the United States were low income jobs. Today, more than 40% of all jobs in the United States are low income jobs.

#20 Young Americans are becoming increasingly frustrated that previous generations have saddled them with a 14 trillion dollar national debt that they are expected to make payments on for the rest of their lives.

A lot of young Americans swing back and forth between anger and despair. Many of them worked like crazy for years because of the promise of a better life, and now they are being bitterly disappointed. Just consider the following testimonial that was recently posted on The Atlantic….

I am in my mid-20s. I have a university education. I started working when I was 14. I have chemical burns and scars over my hands from dealing with caustic cleaning chemicals. I did not want that to be my life like my uncles. I had to get out. I worked very hard in high school and volunteered and was the member of clubs and all of that great stuff. I got into a good university and worked hard. I took a language course, took things that I loved. I worked through my degree – I was even a janitor in a building that I lived in, because I needed the cut in rent. I did that for no pay.

After these months of unemployment I have fallen into a pretty major depression. I live at home, I do chores, I look for work. As much as I want to get my life together, I have some great mental health issues to deal with – but have neither the money to purchase medication that may help me, nor the ability to pay for psychological or psychiatric help.

So what can be done?

Well, someone could wave a magic wand and fix the U.S. economy, but we all know that is not going to happen.

In fact, there is all kinds of evidence that the U.S. economy is about to get even worse.

So should we just tell our young people that they might as well just give up and start making rap videos about using food stamp cards like this one? (*Warning* The video contains some very strong language.)

The number of Americans on food stamps has increased by 74 percent since 2007. Millions of young people are learning that the only way to survive is to be dependent on the government.

It certainly does not help that our entire education system is deeply broken. For example, did you know that the verbal scores on the SAT for the class of 2011 were the lowest ever recorded?

Our students have become so “dumbed down” that large numbers of them can barely even function in society once they graduate.

That is not their fault.

That is our fault.

We have failed young Americans in so many ways that it would take a series of books to detail them all.

We can say that we are sorry, but that just isn’t going to cut it.

Millions of young Americans want what was promised to them, but we no longer have it to give to them.

Anger in this nation is already starting to boil over in strange and unpredictable ways. If the economy gets even worse, we are going to have tens of millions of young Americans that are mad as hell and that are ready to riot in the streets.

What are we going to do then?

According to a recent Gallup poll, 81 percent of Americans are “dissatisfied with the way the nation is being governed”.

That is not a sign of a healthy nation.

The sad truth is that the foundations of America are crumbling and we have millions upon millions of young people that are incredibly angry and incredibly frustrated.

It does not take a genius to figure out that is a recipe for disaster.

So please pray for America.

We are going to need it.

SOURCE

Obama’s urgent jobs plan: ‘Right now’ means sometime next month…after vacation… maybe

Obama’s urgent jobs plan: Right now, ‘right now’ means sometime next month maybe

Everybody remembers the urgency of President Obama’s attitude toward the awful jobs situation.

Back in early August, Obama said the jobs situation was so urgent that he was going to give another speech about it — in a month or so, in September after his vacation on Martha’s Vineyard.

And then in September the president announced he would give his major jobs speech to a joint session of Congress on Sept. 7. But he neglected to check with congressional leaders first. And they suggested the 8th. So, since it was their House, the 8th it was.


“Tonight,” the president said in the first 34 of his 4,021 words to a national television audience that night, “we meet at an urgent time for our country. We continue to face an economic crisis that has left millions of our neighbors jobless, and a political crisis that has made things worse.”

The speech got panned as another political campaign one with Obama announcing, in effect, that….
…since the first stimulus spending plan of $787 billion hadn’t really worked, maybe another $447 billion stimulus spending plan would.

This is the kind of thinking that can make sense within Washington. But since “stimulus” has become a laugh line, he didn’t use that word anymore.

And, hey, the debt ceiling had been raised to $16 trillion. (Speaking of which the president speaks on the debt this morning in another speech because he’s a Real Good Talker.) So why not spend a half-trillion more to look like he’s doing something about the terrible jobs situation with 14+ million unemployed?

If Republicans didn’t bite, no one would know Obama’s Plan B was never going to work anyway. And he could try to blame the GOP next year for failing schools and rusting bridges. This also seems to make sense within WasObama prepares to speaks at the white househington these days.

The president was in such a hurry to get this new spending going, everyone remembers, that during that address he said the phrase “right now” seven times. He didn’t actually mean right now that night because the NFL season was opening a few minutes after his remarks.

But Obama did want to show how really urgent he said the situation was, even though it had taken him 961 days as president to say them. And even though from Day #1 of the brief Obama Era polls had shown jobs and the economy were the No. 1 priority among voters but he pursued healthcare and financial reforms first. And even though unemployment had been at or above 9% for 26 of the last 28 months.

So, given the president’s professed urgency, the next day, Sept. 9, everyone asked where was his jobs legislation?

And, well, it seems the urgent jobs bill hadn’t actually been written yet but should be ready in a week or two. When the laughter died, the White House said on second thought the legislation would be ready for a photo op the next Monday.

Well, here we are on the next Monday after that next Monday and we’ve just learned from the No. 2 Democrat in the Senate, Dick Durbin, that actually it seems that body won’t really be seriously getting into the legislation for a while yet. The Senate has some other more important business to handle. And then there’s this month’s congressional vacation, which in Washington is called “a recess,” like elementary school.

Here’s the revealing exchange with a persistent host Candy Crowley on CNN’s “State of the Union:”

CROWLEY: When is the bill going to get on the floor?

DURBIN: The bill is on the calendar. Majority leader Reid moved it to the calendar. It is ready and poised. There are a couple other items we may get into this week not on the bill and some related issues that may create jobs. But we’re going to move forward on the president’s bill. There will be a healthy debate. I hope the Republicans will come to…

CROWLEY: After the recess, so next month? Or when will it actually begin to act on?

DURBIN: I think that’s more realistic it would be next month.

So, as of right now, “right now” uttered on Sept. 8 really means sometime at least one month later.

Good thing the president’s own Democratic party controls the Senate. Because, otherwise, there might be some kind of silly, unnecessary delays in deliberating Obama’s urgent jobs bill that he says will surely help the nation’s unemployed millions if only those Republicans don’t connive to slow things down.

SOURCE

Student-Loan Delinquencies Rise Sharply! Welcome to Bankruptcy 101

While the job market remains sluggish, student loan debt continues to rise, fueling fears that a higher-education spending bubble may be underway.

Outstanding student debt has climbed 25 percent since the start of the financial crisis in 2008, according to the Federal Reserve Bank of New York — an increase from $440 billion then to $550 billion now. By contrast, every other major category of consumer debt, including mortgage debt, credit card debt, auto loans and home equity loans, is lower today than it was in the fall of 2008.

Not only has student debt risen precipitously, but more and more of those loans aren’t getting paid off on time. In the second quarter of 2011, the rate of student loans that were more than 90 days past due rose from 10.6 percent to 11.2 percent, according to the New York Fed.

Looking at other major types of debt — again, including home loans, auto loans and mortgage and credit card debt — those delinquency rates either declined or stayed flat for the quarter. But delinquency rates for student loans rose and continue to rise.

Experts have warned for years that a bubble may be developing in higher education, as students take out loans to pay for tuition and then find themselves hamstrung by debt and unable to find a job once out of school.

The problems of student-loan delinquency and default are only expected to get worse. Salaries and employment rates for recent college graduates have dropped: The median starting salary for a member of the class of 2009 or 2010 is only $27,000, down from $30,000 a couple of years ago. A recent report from Moody’s Analytics predicted that over the next few years, “many students will be unable to service their loans as income growth falls short of borrowers’ expectations.”

And the debt-ceiling deal that lawmakers reached in Washington earlier this month contains additional provisions that will make life harder for students taking out loans. One section of the deal changes the way interest is collected on a certain kind of federal loan for graduate students, meaning that those borrowers will start accruing interest on their loans before they’ve finished school.

The Moody’s report found that student lending grew by at least 10 percent each year between 2000 and 2010, including during the financial crisis and the Great Recession.

Over the past several decades the expense in the cost of education has grown dramatically along with an upsurge in attendance. Some have referred to this as the College Conspiracy

“Fears of a bubble in educational spending are not without merit,” the report warned.

Last month, the Chronicle of Higher Education reported that one out of every five government student loans that entered repayment in 1995 has since gone into default.

Yet a college degree still appears to be a significant advantage when it comes to the job market. A recent report from the Labor Department shows that for workers 25 and over with at least a bachelor’s degree, the unemployment rate in July was 4.3 percent — compared with 8.3 percent for workers with “some college,” and 9.3 percent for workers with just a high school diploma.

In other words, while unemployment for high school graduates slightly exceeds the national rate of 9.1 percent, the jobless rate for college graduates is less than half that.

SOURCE

40 Facts That Prove The Working Class Is Being Systematically Wiped Out

40 Facts That Prove The Working Class Is Being Systematically Wiped Out

Courtesy The Economic Collapse Blog

Without an abundance of good jobs, the middle class in the United States is going to shrivel up and die. Right now, rampant unemployment is absolutely killing communities all over America. Hopelessness and poverty are exploding and many are now wondering if we are actually witnessing the slow death of the middle class. There simply are not nearly enough “good jobs” to go around anymore, and even many in the mainstream media are referring to this as a “long-term structural problem” with the economy. The only thing that most working class Americans have to offer in the marketplace is their labor. If nobody will hire them they do not have any other ways to provide for their families. Well, there is a problem. Today wealth has become incredibly centralized. The big corporations and the big banks dominate everything. Thanks to incredible advances in technology and thanks to the globalization of our economic system, the people with all the money don’t have to hire as many ordinary Americans anymore. They can hire all the labor they want on the other side of the globe for a fraction of the cost. So the rich don’t really have that much use for the working class in America anymore. The only thing of value that the working class had to offer has now been tremendously devalued. The wealthy don’t have to pay a lot for physical labor anymore. Thousands of our factories and millions of our jobs have been shipped overseas and they aren’t coming back. The big corporations are thriving while tens of millions of ordinary Americans are deeply suffering. Almost all of the wealth being produced by our economy is going to a very centralized group of people at the very top of the food chain. The rich are getting richer and the working class is being systematically wiped out.

So the fact that we are facing rampant unemployment that never seems to go away should not be a surprise to anyone. Today, the “official” unemployment rate went up to 9.2 percent even though a whopping 272,000 Americans “dropped out of the labor force” in June. The government unemployment figure that includes “discouraged workers” went up from 15.8% to 16.2%. The mainstream media is proclaiming that this was “a horrific report” because most economists were expecting much better news.

Well, guess what?

Things are going to get a whole lot worse.

More job cuts are coming. One recently released report found that the number of job cuts being planned by U.S. employers increased by 11.6% in June.

It is also being projected that state and local governments across the U.S. will slash nearly half a million more jobs by the end of next year.

Needless to say, things don’t look good.

Most people that still have jobs are desperately trying to hold on to them.

Employers know that most workers are easily replaceable these days, so wages are not moving up even though the cost of living is.

We are right in the middle of the worst employment downturn since World War 2. Jay-Z recently summed up the situation this way….

“Numbers don’t lie. Unemployment is pretty high.”

Jay-Z certainly has a way with words, eh?

If something is not done about the rampant unemployment in this nation, the death of the middle class will accelerate.

Most Americans just assume that the United States will always have a large middle class, but there is no guarantee that is going to happen. In fact, there is a whole lot of evidence that the middle class in America is rapidly shrinking.

Take a few moments to read over the facts compiled below. Taken together, they provide compelling evidence that the working class is being systematically wiped out….

#1 Right now, the U.S. government says that 14.1 million Americans are unemployed.

#2 There are fewer payroll jobs in the United States today than there were back in 2000 even though we have added 30 million people to the population since then.

#3 The number of Americans that are “not in the labor force” is at an all-time high.

#4 The United States has never had an employment downturn this deep and this prolonged since World War 2 ended.

#5 There are officially 6.3 million Americans that have been unemployed for more than 6 months. That number has risen by more than 3.5 million in just the past two years.

#6 It now takes the average unemployed worker in America about 40 weeks to find a new job. Just check out this chart….

#7 There are now about 7.25 million fewer jobs in America than when the recession began back in 2007.

#8 Back in 2000, the employment to population ratio was over 64 percent. Today, it is sitting at just 58.2%.

#9 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.

#10 During this economic downturn, employee compensation in the United States has been the lowest that it has been relative to gross domestic product in over 50 years.

#11 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.

#12 Half of all American workers now earn $505 or less per week.

#13 According to a report released in February from the National Employment Law Project, higher wage industries are accounting for 40 percent of the job losses in America but only 14 percent of the job growth. Lower wage industries are accounting for just 23 percent of the job losses but 49 percent of the job growth.

#14 The United States has lost a staggering 32 percent of its manufacturing jobs since the year 2000.

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#15 Between December 2000 and December 2010, 38 percent of the manufacturing jobs in Ohio were lost, 42 percent of the manufacturing jobs in North Carolina were lost and 48 percent of the manufacturing jobs in Michigan were lost.

#16 Back in 1970, 25 percent of all jobs in the United States were manufacturing jobs. Today, only 9 percent of the jobs in the United States are manufacturing jobs.

#17 Do you remember when the United States was the dominant manufacturer of automobiles and trucks on the globe? Well, in 2010 the U.S. ran a trade deficit in automobiles, trucks and parts of $110 billion.

#18 In 2010, South Korea exported 12 times as many automobiles, trucks and parts to us as we exported to them.

#19 The United States now spends more than 4 dollars on goods and services from China for every one dollar that China spends on goods and services from the United States.

#20 Since China entered the WTO in 2001, the U.S. trade deficit with China has grown by an average of 18% per year.

#21 The U.S. trade deficit with China in 2010 was 27 times larger than it was back in 1990.

#22 The United States has lost an average of 50,000 manufacturing jobs per month since China joined the World Trade Organization in 2001.

#23 In 2002, the United States had a trade deficit in “advanced technology products” of $16 billion with the rest of the world. In 2010, that number skyrocketed to $82 billion.

#24 Manufacturing employment in the U.S. computer industry was actually lower in 2010 than it was in 1975.

#25 Since 2001, over 42,000 manufacturing facilities in the United States have been closed.

#26 There were more manufacturing jobs in the United States in 1950 than there are today.

#27 Since the year 2000, we have lost approximately 10% of our middle class jobs. In the year 2000 there were about 72 million middle class jobs in the United States but today there are only about 65 million middle class jobs. Meanwhile, our population has gotten significantly larger.

#28 When you adjust wages for inflation, middle class workers in the United States make less money today than they did back in 1971.

#29 One recent survey found that 9 out of 10 U.S. workers do not expect their wages to keep up with soaring food prices and soaring gas prices over the next 12 months.

#30 Only the top 5 percent of U.S. households have earned enough additional income to match the rise in housing costs since 1975.

#31 One out of every six elderly Americans now lives below the federal poverty line.

#32 According to one recent study, approximately 21 percent of all children in the United States were living below the poverty line in 2010.

#33 Back in 1965, only one out of every 50 Americans was on Medicaid. Today, one out of every 6 Americans is on Medicaid.

#34 As 2007 began, there were 26 million Americans on food stamps. Today, there are more than 44 million Americans on food stamps, which is an all-time record.

#35 Today, one out of every four American children is on food stamps.

#36 59 percent of all Americans now receive money from the federal government in one form or another.

#37 The number of Americans that are going to food pantries and soup kitchens has increased by 46% since 2006.

#38 In the United States today, the richest one percent of all Americans have a greater net worth than the bottom 90 percent combined.

#39 According to Moody’s Analytics, the wealthiest 5% of all households in the United States now account for approximately 37% of all consumer spending.

#40 The poorest 50% of all Americans collectively own just 2.5% of all the wealth in the United States.

The cold, hard reality of the matter is that the United States is experiencing a long-term economic decline.

Every single day, more American families fall out of the middle class and into poverty. There are millions of American families out there tonight that are just barely hanging on by their fingernails.

More Americans than ever are constantly borrowing more money just to stay afloat. Even as rampant unemployment plagues this nation and even as wages remain stagnant, middle class Americans are increasing their use of credit.

A CNBC article noted the increase in consumer borrowing that we have seen recently….

The Federal Reserve says consumer borrowing rose $5.1 billion following a revised gain of $5.7 billion in April. Borrowing in the category that covers credit cards increased, as did borrowing in the category for auto and student loans.

It is very hard to live “the American Dream” without going into huge amounts of debt these days.

But for an increasing number of Americans, “the American Dream” is just a distant memory.

Tonight, there are large numbers of people living in the tunnels under the city of Las Vegas. As the wealthy live the high life in the casinos and hotels above them, an increasing number of desperate “tunnel people” are attempting to carve out an existence in the 200 mile long labyrinth of tunnels that stretches beneath Vegas. It is a nightmarish environment, but it is all those people have left.

Don’t look down on them, because you never know who might be next.

If you lost your current job, how long would you be able to survive?

Unfortunately, as bad as things are now, the reality is that this is just the beginning.

You ain’t seen nothin’ yet.

Do what you can to make sure that you and your family are not totally wiped out by the next wave of the economic collapse.

SOURCE

Need a low paying job to barely get by? I’M LOVING IT!

McDonald’s wants to fill 50K jobs on hiring day
Would you like a job with that? McDonald’s holds first national hiring day to fill 50,000 jobs

The Associated Press, On Monday April 4, 2011, 6:18 pm

McDonald’s Corp. will hold its first national hiring day April 19 to fill 50,000 openings at its restaurants nationwide. The company, based in Oak Brook, Ill., says it is making a concerted effort to add staff as its business improves and as more of its restaurants stay open 24 hours a day.

McDonald’s is hiring restaurant crew and management for full-time and part-time positions. The company’s hiring goal translates to between three and four new hires per restaurant.

Turnover slowed in the past few years because of the weak economy, the company says. McDonald’s sees this event an opportunity to attract employees in a tough job market.

It is also trying to shed the negative connotation of employment at the fast-food chain, once dubbed “McJobs.” About half of its franchisees and more than 75 percent of its managers started as store workers.

“A McJob is one with career growth and endless possibilities,” the company said in a statement.

McDonald’s held a similar event in its Western region last year. More than 60,000 people applied for the 13,000 positions.

Those who are interested can apply in stores or online. Some restaurants will hold events and interviews that day.

http://finance.yahoo.com/news/McDonalds-wants-to-fill-50K-apf-1401285143.html?x=0

McJob
From Wikipedia, the free encyclopedia

McJob is slang for a low-paying, low-prestige dead end job that requires few skills and offers very little chance of intracompany advancement.[1] The term McJob comes from the name of the fast-food restaurant McDonald’s, but is used to describe any low-status job — regardless of the employer — where little training is required, staff turnover is high, and workers’ activities are tightly regulated by managers. Most perceived McJobs are in the service industry, particularly fast food, coffee shops, telemarketing, retail and business-to-business copywriting. Working at a low paying job, especially one at a fast food restaurant, is also referred to as flipping burgers.

“McJob” was in use at least as early as 1986, according to the Oxford English Dictionary (OED), which defines it as “An unstimulating, low-paid job with few prospects, esp. one created by the expansion of the service sector.”[2] Lack of job security is common.

The term was coined by sociologist Amitai Etzioni, and appeared in the Washington Post on August 24, 1986 in the article “McJobs are Bad for Kids”.[3][4] The term was popularized by Douglas Coupland’s 1991 novel Generation X: Tales for an Accelerated Culture, described therein as “a low-pay, low-prestige, low-dignity, low benefit, no-future job in the service sector. Frequently considered a satisfying career choice by people who have never held one.”[5]

The term appears in the 1994 novel Interface (by Neal Stephenson and George Jewsbury) to describe in the abstract positions that are briefly held and underpaid. In the 1999 British film Human Traffic, one character’s work in a generic burger outlet is referred to as a McJob.

There are often wide variations in how workers are actually treated depending on the local franchise owner. Some employees start out in entry-level McJobs and later become assistant managers or managers, continuing to work at the same franchise for many years; however this is the exception rather than the norm.[6] McDonald’s advertises that its CEO, Jim Skinner, began working at the company as a regular restaurant employee, and that 20 of its top 50 managers began work as regular crew members.[7]

According to Jim Cantalupo, former CEO of McDonald’s, the perception of fast-food work being boring and mindless is inaccurate, and over 1,000 of the men and women who now own McDonald’s franchises began behind the counter.[6][8] Because McDonald’s has over 400,000 employees and high turnover, Cantalupo’s contention has been criticized as being invalid, working to highlight the exception rather than the rule.[9]

The term “McJob” was added to Merriam-Webster’s Collegiate Dictionary in 2003,[10] over the objections of McDonald’s. In an open letter to Merriam-Webster, Cantalupo denounced the definition as a “slap in the face” to all restaurant employees, and stated that “a more appropriate definition of a ‘McJob’ might be ‘teaches responsibility.'” Merriam-Webster responded that “[they stood] by the accuracy and appropriateness of [their] definition.”

In 2006, McDonald’s undertook an advertising campaign in the United Kingdom to challenge the perceptions of the McJob. The campaign, developed by Barkers Advertising and supported by research conducted by Adrian Furnham, professor of psychology at University College London, highlighted the benefits of working for the organization, stating that they were “Not bad for a McJob”. So confident were McDonald’s of their claims that they ran the campaign on the giant screens of London’s Piccadilly Circus.[11]

On 20 March 2007, the BBC reported that the UK arm of McDonald’s planned a public petition to have the OED’s definition of “McJob” changed.[12][13] Lorraine Homer from McDonald’s stated that the company feels the definition is “out of date and inaccurate”.[14] McDonald’s UK CEO, Peter Beresford, described the term as “demeaning to the hard work and dedication displayed by the 67,000 McDonald’s employees throughout the UK”.[15] The company would prefer the definition to be rewritten to “reflect a job that is stimulating, rewarding … and offers skills that last a lifetime.”[16][17] These comments run counter to the principle that dictionaries simply record linguistic usage rather than judge it, and that dropping the entry for “McJob” would be a precedent for bowdlerising definitions of other derogatory terms.[16]

During the aforementioned arguments that broke out when Merriam-Webster included “McJob” in its new edition, McDonald’s officials implied the company might bring a lawsuit against the dictionary based on this trademark issue, but never did so. McDonald’s disputes that its jobs are poor, because the company has been nominated for employee awards that are created by employers.[18][19][20][21][22][23][24] However, this was contradicted in the outcome of the UK McLibel court case, in which the judges ruled that it was fair to say that McDonald’s employees worldwide “do badly in terms of pay and conditions”.[25]
[edit] McJOBS, the trademark

McJOBS (plural, uppercase) was first registered as a trademark by McDonald’s on May 16, 1984, as a name and image for “training handicapped persons as restaurant employees”. The trademark lapsed in February 1992, and was declared “Canceled”[26] by the United States Patent and Trademark Office. Following the October 1992 publication of Generation X in paperback, McDonald’s restored the trademark.[27][28]

http://en.wikipedia.org/wiki/McJob

Texans look at expanding gambling, drug testing for unemployment benefits, to cover budget shortfalls

Texans Could Vote on Expanding Gambling


The Texas Gaming Association says expanding gambling could bring in $1.2 billion a year in gaming taxes alone.

By CHRIS TOMLINSON

Texans could get to vote on a constitutional amendment to expand gambling.

The House Licensing and Administrative Procedures Committee will hear testimony on a number of measures to allow casinos and slot machines. The Texas Gaming Association is backing a measure that would license eight casinos and slot machines at eight racetracks. Other measures would allow gambling on Indian reservations or slot machines at bingo halls.

The Texas Gaming Association says its proposal could bring in $1.2 billion a year in gaming taxes alone. The organization also released a poll it said found that 86 percent of Texans believe there should be a vote on gambling.

The state faces a $23 billion budget shortfall over the next two years. Opponents warn that gambling could bring more trouble than it’s worth.

http://www.nbcdfw.com/news/local/Texans-Could-Vote-on-Expanding-Gambling-118837164.html?dr

State Lawmaker Wants Drug Tests For Welfare Recipients

March 29, 2011 8:44 AM
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SPRINGFIELD, Ill. (WBBM) – A state lawmaker wants welfare recipients to submit to drug tests in order to receive aid, but he admits the proposal isn’t ready for a full debate – and probably won’t make it into law this year.

This isn’t the first time State Rep. Jim Sacia (R-Pecatonica) has introduced such a measure. He first introduced it three years ago when a constituent asked him why welfare applicants don’t submit to drug tests, but many job applicants do.

This year’s bill would create a pilot program to administer the drug tests in three counties for three years.

Sacia cautions his bill will not fix all welfare problems. But he says lawmakers must create a way to foster a change in recipients’ attitudes, and this is a good start.

“We have to come up with a way, and this is a Panacea I recognize that, where we’re creating a motivational factor for people to want to get off the welfare rolls, to get back to legitimate employment,” explains Sacia.

Sacia says House Bill 11 is imperfect, but is getting better. He says one of the bills’ amendments will eventually address how to pay for the drug tests, but the specifics have yet to be hammered out.

The proposal has received significant push back in its first three years, namely from the House Human Services Committee.

“I will not move the bill until I get a bill that I can get those who are adamantly opposed to it, maybe not to necessarily say they’re in support of the bill, but to go neutral on [it],” says Sacia.

http://chicago.cbslocal.com/2011/03/29/state-lawmaker-wants-drug-tests-for-welfare-recipients/

The Gathering Storm

THE GATHERING STORM

“Still, if you will not fight for the right when you can easily win without bloodshed, if you will not fight when your victory will be sure and not so costly, you may come to the moment when you will have to fight with all the odds against you and only a precarious chance for survival. There may be a worse case. You may have to fight when there is no chance of victory, because it is better to perish than to live as slaves.” – Winston Churchill – The Second World War

A butterfly flapped its wings in Tunisia creating a hurricane that is swirling across the globe, wreaking havoc with the existing social order and sweeping away old crumbling institutions and dictatorships. The linear thinking politicians, pundits and thought leaders have been knocked for a loop. They didn’t see it coming and they don’t know where it’s leading. An examination and understanding of history would have revealed that we have been here before. We were here in 1773. We were here in 1860. We were here in 1929. We are here again. The Fourth Turning has returned in its predictable cycle, just as Winter always follows Fall.

Winston Churchill wrote the definitive history of World War II in 1948. His six volume history detailed the years from the end of World War I through the unconditional surrender of the Axis powers in 1945. Volume I in the series was The Gathering Storm. It covered the second half of the Unraveling and the first ten years of the last Fourth Turning Crisis period. The title fits perfectly with the mood and inevitability of what was destined to occur. All Fourth Turnings resemble Winter, with bitter cold options, biting winds of change, dark days, and destructive storms. The seasons cannot be averted. The Seasons of a year are predictable, as are the seasons of a human life. We’ve entered the Crisis (Winter) season of the latest Saeculum that began in 1946 and will climax sometime around 2025.

“Reflect on what happens when a terrible winter blizzard strikes. You hear the weather warning but probably fail to act on it. The sky darkens. Then the storm hits with full fury, and the air is a howling whiteness. One by one, your links to the machine age break down. Electricity flickers out, cutting off the TV. Batteries fade, cutting off the radio. Phones go dead. Roads become impossible, and cars get stuck. Food supplies dwindle. Day to day vestiges of modern civilization – bank machines, mutual funds, mass retailers, computers, satellites, airplanes, governments – all recede into irrelevance. Picture yourself and your loved ones in the midst of a howling blizzard that lasts several years. Think about what you would need, who could help you, and why your fate might matter to anybody other than yourself. That is how to plan for a saecular winter. Don’t think you can escape the Fourth Turning. History warns that a Crisis will reshape the basic social and economic environment that you now take for granted.” – Strauss & Howe – The Fourth Turning

The generations are aligned in such a way that an event, incident, or individual action that may have been disregarded or ignored ten years ago will now trigger a worldwide conflagration. The Boston Massacre occurred in1770 during Revolutionary Saeculum. Five colonists were slaughtered by British troops. The mood of the generations was not ready for a Crisis. It wasn’t until three years later that the Boston Tea Party ignited a spark that started a revolution. John Brown’s raid on Harper’s Ferry in 1859 was intended to start a revolution. The populace was not ready. One year later, the election of Abraham Lincoln lit the fuse on the most horrific war in modern history. America experienced a sharp depression in 1920-1921. The country did not spiral into a decade long downturn, culminating in a World War that killed 65 million people. The generational dynamic was not aligned in a way that would lead to that outcome. Instead, the roaring twenties commenced. On December 17, 2010 a man committed a seemingly inconsequential act that has ignited a worldwide firestorm.

The spark that has inflamed the planet was struck by a 26-year-old Tunisian with a computer science degree named Mohamed Bouazizi, who unable to feed his family, was not allowed by his government to even get a permit to sell vegetables. Bouazizi publicly doused himself with gasoline, lit a match, and burnt not only his own body, but inflamed the consciousness of a world, and its inhabitants, being obliterated by the corrupt wealthy elites who rule the planet. In less than a month the brush fire started by this 26-year-old Tunisian had incinerated the despotic government of his country and forced its “president-for-life”, Zine El Abidine Ben Ali, to flee the country. The people’s coup in Tunisia, called the Jasmine Revolution, has sent shockwaves across the globe, spreading wildfires of freedom throughout the Arab world. The firestorm started by Bouazizi has brought down Mubarak in Egypt and is lapping at the heals of Gaddafi in Libya. Tyrants throughout the world are quivering with fear. The mood of the people across the globe has turned dark and angry. The political class and media are persistently surprised by the reaction of citizens to events during the Fourth Turning.

Historians Robert Strauss and Neil Howe documented their generational theory in the 1997 book The Fourth Turning. People who prefer blind ideology and believe human existence is a straight line of progress scorn their work as fantasy and pure prophecy. So called progressives misrepresent the theory as predicting the future because they refuse to accept the fact that large groups of human beings of a similar age and having common experiences react in similar predictable ways. It irritates those with an unwavering belief in human individuality. They prefer to ignore the numerous example of mass hysteria throughout history. In just the last 10 years we have experienced an internet boom and a housing boom that convinced millions of Americans to act simultaneously in a foolish manner . The theory is so logical and measurable that even the most vacuous blond bubble head on Fox News should understand it.

Strauss & Howe have been able to break Anglo-American history into 80 to 100 year (a long human life) Saeculums going back to 1435. Each Saeculum has four generations at different stages of their lives. A turning is an era with a characteristic social mood, a new twist on how people feel about themselves and their nation. It results from the aging of the generational constellation. A society enters a turning once every twenty years or so, when all living generations begin to enter their next phases of life. Like archetypes and constellations, turnings come four to a saeculum, and always in the same order. In 1997, Strauss & Howe knew when the next Fourth Turning would begin:

The next Fourth Turning is due to begin shortly after the new millennium, midway through the Oh-Oh decade. Around the year 2005, a sudden spark will catalyze a Crisis mood. Remnants of the old social order will disintegrate. Political and economic trust will implode. Real hardship will beset the land, with severe distress that could involve questions of class, race, nation and empire. The very survival of the nation will feel at stake. Sometime before the year 2025, America will pass through a great gate in history, commensurate with the American Revolution, Civil War, and twin emergencies of the Great Depression and World War II.” – Strauss & Howe – The Fourth Turning

They did not predict events that would ignite the next Fourth Turning. It was how the generations reacted to the events that mattered. The generational constellation is now in the once every 80 year alignment that will lead to chaos, violent change, the sweeping away of the existing social order, and likely war. Strauss & Howe answered why this would happen fourteen years ago:

“What will propel these events? As the saeculum turns, each of today’s generations will enter a new phase of life, producing a Crisis constellation of Boomer elders, midlife 13ers, young adult Millennials, and children from the new Silent Generation. As each archetype asserts its new social role, American society will reach its peak of potency. The natural order givers will be elder Prophets, the natural order takers young Heroes. The no-nonsense bosses will be midlife Nomads, the sensitive souls the child Artists. No archetypal constellation can match the gravitational power of this one – nor its power to congeal the natural dynamic of human history into new civic purposes. And none can match its potential power to condense countless arguments, anxieties, cynicisms, and pessimisms into one apocalyptic storm.” – Strauss & Howe – The Fourth Turning

I believe my generation is about to experience a rendezvous with destiny. Each generation’s life experiences have prepared them for this hour and the trials that await them. The mood of the country has shifted darkly into a crisis mode. The mainstream media pundits and progressive politicians try to put a positive spin on today’s events, when anyone with the ability to think can see that things will get severely worse in the next ten years. Trust in our institutions, politicians, corporate leaders, media and social order is disintegrating.
It’s a Matter of Trust

“An initial spark will trigger a chain reaction of unyielding responses and further emergencies. The core elements of these scenarios (debt, civic decay, global disorder) will matter more than the details, which the catalyst will juxtapose and connect in some unknowable way. If foreign societies are also entering a Fourth Turning, this could accelerate the chain reaction.” – Strauss & Howe – The Fourth Turning

The initial spark that ignited this Fourth Turning was the collapse of the housing market, which began in 2005 and continues today. Home prices collapsed, the fraudulent mortgage loans blew up in the faces of the Wall Street banks that birthed them, and millions of delusional Americans lost their houses in foreclosure. The cascading impact of this implosion brought the American empire of debt to its knees. On September 18, 2008 the U.S. financial system came within hours of complete collapse, as described by Congressman Paul Kanjorski on CPAN:

“On Thursday (Sept 18), at 11am the Federal Reserve noticed a tremendous draw-down of money market accounts in the U.S., to the tune of $550 billion was being drawn out in the matter of an hour or two. The Treasury opened up its window to help and pumped a $105 billion in the system and quickly realized that they could not stem the tide. We were having an electronic run on the banks. They decided to close the operation, close down the money accounts and announce a guarantee of $250,000 per account so there wouldn’t be further panic out there.

If they had not done that, their estimation is that by 2pm that afternoon, $5.5 trillion would have been drawn out of the money market system of the U.S., would have collapsed the entire economy of the U.S., and within 24 hours the world economy would have collapsed. It would have been the end of our economic system and our political system as we know it.”

The implosion of the financial system was created by the actions of the Wall Street financers that have been looting the country for decades. They created mortgage products (no doc, liar loans, Alt-A, negative amortization) designed to encourage people to commit fraud. They purposely promoted this massive fraud because they had perfected the art of derivatives. The issuers of these fraudulent mortgages bore none of the risk from their guaranteed default. They packaged them into MBOs and MBSs, bought AAA ratings from Moodys, and shilled them to pension managers, insurance companies, municipalities, states, and little old ladies. Then they bet against their own products with credit default swaps. Their greed and avarice was so extreme, they leveraged their own balance sheets 40 to 1 and then bought their own toxic waste. When their MBA created models proved to be defective, the entire house of cards collapsed. Strauss and Howe anticipated a financial catalyst related to immense levels of debt would trigger the next Fourth Turning:

It is unlikely that the catalyst will worsen into a full-fledged catastrophe, since the nation will probably find a way to avert the initial danger and stabilize the situation for a while.

After the near collapse of the financial system in September 2008, the authorities took unprecedented actions to avert a Second Great Depression. Henry Paulson, the Goldman Sachs U.S. Treasury Secretary, who had warned his own staff that a Wall Street derivative disaster would happen, immediately reacted like a former Wall Street CEO. He convinced his Harvard MBA boss, George W. Bush, that the only way to save the country was to fork over $700 billion to the Wall Street banks that created the manmade disaster. When Congress initially voted down this banker bribe, Wall Street showed who was boss by crashing the market by 777 points in one day. The bought off politicians in Washington DC then towed the line and passed TARP.

The two and one half years since September 2008 have set the stage for a far worse catastrophe. The Obama administration jammed an $800 billion pork filled stimulus bill down the throats of America, along with home buyer tax credits, loan modification programs, and a healthcare plan that will crush small businesses. The politicians, government bureaucrats, and mainstream media corporate mouthpieces proclaim that their wise and prompt actions averted a Second Great Depression. The government solutions used to “stabilize” the situation have wrought unintended consequences and planted the seeds of further pain and suffering to come. A summary of what has happened in the last few years is in order:

* On September 18, 2008 the National Debt stood at $9.66 trillion. Today it stands at $14.16 trillion, a 47% increase in 2 1/2 years.
* The country is running $1.5 trillion annual deficits and will continue to do so for the foreseeable future.
* The States are running cumulative budget deficits of $130 billion in FY11 and expect deficits of $112 billion in FY12. This is leading to conflicts with unions, higher taxes and mass layoffs of government workers.
* The working age population has risen by 5 million, while the number of employed Americans has declined by 6.5 million. The true unemployment rate http://www.shadowstats.com/alternate_data/unemployment-charts has risen from 12% to 22%.
* In September 2008 there were 30.8 million Americans on food stamps. Today there are 44 million Americans on food stamps (14% of the U.S. population), a 43% increase in 2 1/2 years. The annual cost has risen by $37 billion, a 100% increase in 2 1/2 years.
* Real inflation http://www.shadowstats.com/alternate_data/inflation-charts bottomed at 5% in early 2009, but has accelerated to 9% today, with further increases baked in the cake.
* Gasoline prices bottomed out at $1.61 per gallon in January 2009 and have risen to $3.54 per gallon today, a 120% increase in just over two years.
* Households have lost $6.3 trillion of real estate related wealth since the peak of the housing market. Home prices have fallen for six straight months.
* Almost 3 million homes have been lost to foreclosure since 2007.
* There are 11.1 million households, or 23.1% of all mortgaged homes, underwater on their mortgages today, with rates above 50% in Nevada, Arizona, California, and Michigan.
* Fannie Mae and Freddie Mac were taken over by the US government and have lost $170 billion of taxpayer funds so far. Losses are expected to reach $400 billion. Along with the FHA, they continue to prop up a dead housing market with more bad loans.
* The Federal Reserve balance sheet in September 2008 consisted of $895 billion of US Treasury bonds. Today it totals $2.55 trillion of toxic mortgages bought from Wall Street banks and Treasury bonds being bought under QE2.
* The Federal Reserve and the Treasury Dept. intimidated the FASB into allowing Wall Street banks to account for worthless mortgage and real estate loans as fully collectible. Magically, insolvent banks became solvent – on paper.
* The Dow Jones was 11,700 in late August 2008 and today stands at 12,000. The Dow has risen 84% from its March 2009 low. The top 1% wealthiest Americans own 40% of all the stocks in America, so they are feeling much better.
* In late 2007, a risk averse senior citizen could get a 5% return on a 6 month CD. Today, after two years of no increases in their Social Security payments, a senior citizen can “earn” .38% on a 6 month CD.
* The Federal Reserve lowered interest rates to 0% in order to allow the Wall Street banks to borrow for free and earn billions without risk.
* Over 300 smaller banks have been closed by the FDIC, with losses exceeding $50 billion. There are another 900 banks on the verge of insolvency, with estimated future losses of $100 billion.
* The Federal Reserve initiated QE2 in November 2010, purchasing $70 billion per month of Treasury bonds and attempting to create a stock market rally. They have succeeded in creating a tsunami of energy, food, and commodity price inflation across the globe, sparking revolutions among the desperately poor in the Middle East.
* Wall Street banks “earned” record profits of $19 billion in 2010 after nearly destroying the worldwide financial system in 2008 and raping the American taxpayer in 2009.
* No Wall Street executive has been prosecuted for the fraudulent actions committed by their banks.
* Wall Street banks handed out $43.3 billion in bonuses in 2009/2010 for a job well done. The average Wall Street employee received a $128,000 bonus in 2010. In 2008, the year they crashed the financial system, they still doled out $17.6 billion in bonuses.
* The median household income in 2007 was $52,163. Today the median household income is $46,326, an 11% decline in three years. Real average weekly earnings are lower today than they were in 1971.

It is clear from the list above that the oligarchic players that wield the power in this country have chosen to prop up their tottering structure of debt-created-wealth on the backs of the working middle class. The people who have been screwed and continue to be screwed are growing angry and distrustful, as anticipated by Strauss & Howe:

“But as the Crisis mood congeals, people will come to the jarring realization that they have grown helplessly dependent on a teetering edifice of anonymous transactions and paper guarantees. Many Americans won’t know where their savings are, who their employer is, what their pension is, or how their government works. The era will have left the financial world arbitraged and tentacled: Debtors won’t know who holds their notes, homeowners who owns their mortgages, and shareholders who runs their equities – and vice versa.”

The continuing foreclosure crisis has proven that the financial industry’s sole purpose in creating subprime loans, liar loans, Alt-A loans and packaging them into tranches with fake AAA ratings to be sold off to whatever sucker they could find was to enrich themselves with no care about the future consequences. The owners of the debt can’t prove they own the debt. Lawsuits clog up the court system. Deadbeats occupy houses for longer than two years without making a mortgage payment. Wall Street has created so many complex confusing financial products in their greedy thirst for fees that Harvard MBAs can’t even figure out the mess they have created. The $1.4 quadrillion of outstanding derivatives is truly a weapon of mass worldwide destruction waiting to be triggered. The fraudulent actions of Wall Street, the lies told to the American people by government bureaucrats about the solutions needed, the overstep and obfuscation committed by Ben Bernanke, and the propaganda fed to the masses by the corporate mainstream have destroyed the remaining trust in our institutions. Distrust grows by the day, as Strauss and Howe foresaw in 1997:

“As the Crisis catalyzes, these fears will rush to the surface, jagged and exposed. Distrustful of some things, individuals will feel that their survival requires them to distrust more things. This behavior could cascade into a sudden downward spiral, an implosion of societal trust.”

The growing distrust of financial and governmental institutions was reflected in the angry and sometimes violent town hall meetings with Congressmen during the healthcare debate. An angry on-air rant by financial reporter Rick Santelli ignited the Tea Party movement that eventually swept dozens of candidates into office in a Republican landslide in the 2010 mid-term elections. Societal trust in promises made by politicians is ripping apart. The entitlement benefit promises can’t be kept. Senior citizen and government union beneficiaries are angry. Younger generations don’t want to be left with debt so older generations can have comfortable 25 year retirements. Taxpayers don’t want to pay higher taxes to support gold plated healthcare and pension plans for government union workers. The decades of compromise, denial, apathy and lethargy are over. The mood of the country has changed dramatically. Survival of the country is at stake.
Volcanic Eruption

“America’s short-term Crisis psychology will catch up to the long-term post-Unraveling fundamentals. This might result in a Great Devaluation, a severe drop in the market price of most financial and real assets. This devaluation could be a short but horrific panic, a free-falling price in a market with no buyers. Or it could be a series of downward ratchets linked to political events that sequentially knock the supports out from under the residual popular trust in the system. As assets devalue, trust will further disintegrate, which will cause assets to devalue further, and so on. Every slide in asset prices, employment, and production will give every generation cause to grow more alarmed. With savings worth less, the new elders will become more dependent on government, just as government becomes less able to pay benefits to them.” – Strauss & Howe – The Fourth Turning

The country has withstood the initial onslaught of this latest Fourth Turning. The Great Devaluation resulted in a 50% stock market crash and a 30% decline in home values. Rather than allowing home values to fall to their fair value, the government used tax credits and loan modification programs to prop up home prices. Rather than liquidating insolvent Wall Street banks in an orderly bankruptcy, the government and Federal Reserve chose to use accounting gimmicks and borrowed taxpayer funds to save those who had taken excessive risks and reaped hundreds of billions in profits. The government has systematically ”adjusted” every economic statistic in order to paint the most optimistic view possible. Unemployment, inflation, government debt, and GDP are all manipulated in the most positive light.

Many people understand that you cannot solve a debt problem by issuing more debt. They understand that politicians have overpromised Social Security and Medicare benefits to the tune of $100 trillion. They understand that if you cover 30 million more people in your healthcare system, it will cost hundreds of billions more. They understand that mega-corporations have shipped their manufacturing jobs overseas, and they aren’t coming back. They understand spending $800 billion per year, policing the world, fighting two wars of choice, with hundreds of military bases across the globe is unsustainable. They understand that running $1.5 trillion deficits will eventually result in a collapse of the U.S. dollar. They understand that an individual or a country cannot borrow their way to prosperity. The U.S. government is essentially bankrupt and dependent upon Ben Bernanke’s printing press to keep up the appearance of solvency.

Fingers of tension and instability run through every aspect of American society. Pressure is building beneath the surface. The last year and a half have proven to be a liquidity driven lull. The appearance of stability does not mean our situation has stabilized. The actions of those in power have created a vastly more dangerous scenario for the next decade. The volcano is erupting and the lava is flowing along the channels of distress, as described by Strauss & Howe:

Imagine some national (and probably global) volcanic eruption, initially flowing along channels of distress that were created during the Unraveling era and further widened by the catalyst. Trying to foresee where the eruption will go once it bursts free of the channels is like trying to predict the exact fault line of an earthquake. All you know in advance is something about the molten ingredients of the climax, which could include the following:

* Economic distress, with public debt in default, entitlement trust funds in bankruptcy, mounting poverty and unemployment, trade wars, collapsing financial markets, and hyperinflation (or deflation)
* Social distress, with violence fueled by class, race, nativism, or religion and abetted by armed gangs, underground militias, and mercenaries hired by walled communities
* Political distress, with institutional collapse, open tax revolts, one-party hegemony, major constitutional change, secessionism, authoritarianism, and altered national borders
* Military distress, with war against terrorists or foreign regimes equipped with weapons of mass destruction

Strauss & Howe did not predict specific events that would occur during the next Fourth Turning. As trained historians and economists, they simply analyzed the environment created by our leaders over the last few decades. If the thought leaders in the country had not been blinded by their ideological biases, they would have seen that the next Fourth Turning Crisis would be channeled by un-payable debt obligations, reckless financial schemes, religious ideology, political corruption, class warfare, foreign conflicts, and terrorism. The molten ingredients are travelling along the channels outlined above. What happens next is anybody’s guess.

The economic distress worsens for the average American every day. The recovery propaganda circulated by the power elite through the mass media is a fraud. Only those with wealth and power have recovered. The middle class sinks further into poverty and despair. Unemployment remains at Depression levels and the entire economic faux recovery rests with Ben Bernanke’s printing press. The only question that remains is whether the United States experiences a deflationary collapse or a hyper-inflationary collapse. The country is currently experiencing stagflation as the things we need (energy, food, clothing) inflate, while wages stagnate and our home values deflate. Bernanke and his minions at the Federal Reserve will choose inflation as their poison because it will allow their banker masters to pilage the remaining wealth of the middle class before the final collapse of the U.S. dollar.

Social distress has manifested itself over the last year in Arizona as the illegal immigration issue has turned violent, with State government and Federal government in conflict. The social welfare net is being strained through the payment of billions in unemployment compensation, food stamps, and other welfare programs. When this net breaks, all hell will break loose in the decaying urban Mecca’s. Political distress is at historic levels as the Tea Party battles liberals and its own neo-con Republican establishment. States are refusing to implement the Federally mandated Obamacare. Governors are battling teacher’s unions, firemen unions, and police unions in an effort to regain control of their out of control budgets. The 2012 elections could prove to be a tipping point for the country.

Military distress is already extreme, even before a major conflict is thrust upon the country. The two wars of choice in the Middle East have drained trillions from the treasury of a declining empire. The all volunteer military has been stretched to the breaking point. The multi-billion dollar high tech weaponry has proven useless against “terrorists” who fade into mountains until they can strike again. As revolution erupts across the Middle East, the U.S. is helpless and has no credibility, as they have propped up the thugs and dictators who are slaughtering their people. The daily intensification of volcanic eruptions across the globe is clearly evident to all but the most linear thinkers. We’ve entered the Fourth Turning and there is no turning back.
Prophecy or Destiny

“Soon after the catalyst, a national election will produce a sweeping political realignment, as one faction or coalition capitalizes on a new public demand for decisive action. Republicans, Democrats, or perhaps a new party will decisively win the long partisan tug of war. This new regime will enthrone itself for the duration of the Crisis. Regardless of its ideology, that new leadership will assert public authority and demand private sacrifice. Eventually, all of America’s lesser problems will combine into one giant problem. The very survival of the society will feel at stake, as leaders lead and people follow. The emergent society may be something better, a nation that sustains its Framers’ visions with a robust new pride. Or it may be something unspeakably worse. The Fourth Turning will be a time of glory or ruin.” – Strauss & Howe – The Fourth Turning

The election of Barack Obama in 2008 did not usher in a sweeping political realignment of the country. The actions he has taken in the last two years have maintained the status quo. The financial industry complex, military industrial complex, and big pharma complex are stronger and more powerful today than they were in 2008. The 2010 midterm elections were a decisive rejection of Obama’s policies. Those who think he will be re-elected in 2012 are not seeing the big picture. Previous Fourth Turnings have ushered in strong dominating Prophet (Boomer) leaders who used any means necessary to bring the country through the Crisis. Wishy washy politically calculating compromiser leaders do not cut it during a time of intense Crisis. The number of vulnerable Democratic Senators up for re-election in 2012 virtually insures that Republicans will control both houses of Congress in 2012. A legitimate 3rd Party candidate does not appear to be on the horizon. The onset of phase two of the economic meltdown will determine the next President of the United States.

Before the 2012 elections, I expect a violent downturn in our economic fortunes spurred by a continued fall in real estate values, generating more debt losses for the financial industry, and a loss of confidence in the U.S. fiat currency, as our foreign creditors balk at lending more money to an already insolvent empire that is incapable of taking corrective budgetary actions. The resulting economic turmoil, crashing stock market, rising interest rates, and massive unemployment will lead the nation to seek a strong, decisive, authoritative leader who will boldly lead the country through the remainder of the Crisis. Will it be Newt Gingrich, Mitt Romney, Chris Christie, or a Lincoln like figure who hasn’t even entered the national stage yet? This question is unanswerable today. But, the country will turn to someone with answers. Strauss and Howe clearly state how important the next 10 to 15 years will be:

“Decisive events will occur – events so vast, powerful, and unique that they lie beyond today’s wildest hypotheses. These events will inspire great documents and speeches, visions of a new political order being framed. People will discover a hitherto unimagined capacity to fight and die, and to let their children fight and die, for a communal cause. The Spirit of America will return, because there will be no other choice. Thus will Americans reenact the great ancient myth of the ekpyrosis. Thus will we achieve our next rendezvous with destiny.”

I’m convinced that decisive events will transpire over the next decade that will push our country to the brink. The country is on an unsustainable path and we will either crash and burn or take the actions needed to avert catastrophe. Vast powerful events on an incomprehensible scale await. Events as farfetched as a Weimar like hyperinflationary economic collapse, the detonation of a nuclear bomb in a major American city, the secession of one or more States from the Union, the collapse of our oil based economy due to peak oil and/or revolution and turmoil in the Middle East, or a worldwide pandemic, will become not only realistic, but probable. Are these events any more improbable than a 9.0 earthquake, leading to a 33 foot high tsunami wave, which triggers nuclear meltdowns at two separate nuclear power plants? If you had outlined that scenario a week ago, you would have been classified as a crazy prophet of doom.

At this point in time, it doesn’t seem possible that a communal cause could rejuvenate the Spirit of America in a manner that would lead me to be willing to fight and die or send my three sons to fight and die. An imminent threat, such as the Axis Powers during World War II, the North and South seeing each other as a threat during the Civil War, or the threat from a foreign empire during the American Revolution, does not appear evident today. The war on terror is a concept, rather than a real war. The absence of a known foreign adversary makes me think that the conflict could center on our own soil between Americans. Strauss and Howe point out that history does not offer much hope in avoiding armed conflict during this Fourth Turning:

“History offers even more sobering warnings: Armed confrontation usually occurs around the climax of Crisis. If there is confrontation, it is likely to lead to war. This could be any kind of war – class war, sectional war, war against global anarchists or terrorists, or superpower war. If there is war, it is likely to culminate in total war, fought until the losing side has been rendered nil – its will broken, territory taken, and leaders captured.”

When it comes to what kind of armed confrontation, how about all of the above? The wealth distribution of the country is more heavily skewed to the “Haves” versus the “Have Nots” than any time in history. The austerity measures that are being proposed on the backs of the middle class and senior citizens, while ultra-rich bankers have been bailed out and allowed to continue pillaging the countryside, will surely lead to class conflict. Generational warfare between the Boomers who want what they are “owed” and younger generations stuck with the bill will flare up in the coming years. The country has become so ideological that it can be easily split into Red States and Blue States. Could this ideological divide result in the country splitting into two or three independent countries? Would the Federal government use the armed forces to maintain one country? It happened before.

The war on terror concept has been in place for the last ten years and has resulted in draining the Treasury of trillions, exhausting our limited volunteer forces, and creating more terrorists than existed on September 10, 2001. The revolutions sweeping across Northern Africa and the Middle East are not cause for celebration in Washington DC. American foreign policy has centered on supporting thugs, despots, and dictators across this region with financial aid and weapons. The aid was absconded and sent to bank vaults in Switzerland. The weapons are being used to kill the poor revolutionaries across the region. Two American backed dictators have been deposed thus far, with Yemen likely to follow. Our allies in the region are falling with lightening speed. The loss of Saudi Arabia would portend dire consequences for the U.S. If the Middle East oil spigot is turned off, the American way of life will wither and die.

The myth of American Exceptionalism will not protect the country from the revolutionary tsunami that is sweeping the globe. America was not chosen by God as the country that would lead the world for eternity. The hubris and overreach of the American empire has bankrupted the nation. Greed, corruption and arrogance are not limited to North African dictatorships. Crony capitalism supporting a vast military empire, financed by a banker controlled Federal Reserve has failed. Its failure will become clear as the Fourth Turning intensifies and sweeps away the old order. Who or what replaces the old order is unknown. Much will depend on the generations and their response to the Crisis.
Bad Moon Rising

Robert Strauss and Neil Howe had no interest in trying to predict the future. As historians, they wanted to understand how the past could give clues to what would happen in the future. They discovered a pattern of behavior by generational archetypes across centuries of Anglo-American history. They identified the issues that would drive the next Fourth Turning. They predicted the timing. The accuracy of their prophecy thus far, has been uncanny. The rhythms of history continue. The outcome of this Crisis is unknowable, but there is most certainly a bad moon rising.

Thus might the next Fourth Turning end in apocalypse – or glory. The nation could be ruined, its democracy destroyed, and millions of people scattered or killed. Or America could enter a new golden age, triumphantly applying shared values to improve the human condition. The rhythms of history do not reveal the outcome of the coming Crisis; all they suggest is the timing and dimension. – Strauss & Howe – The Fourth Turning

I see the bad moon arising.
I see trouble on the way.
I see earthquakes and lightning.
I see bad times today.

Don’t go around tonight,
Well, it’s bound to take your life,
There’s a bad moon on the rise.

I hear hurricanes ablowing.
I know the end is coming soon.
I fear rivers over flowing.
I hear the voice of rage and ruin.

Hope you got your things together.
Hope you are quite prepared to die.
Looks like we’re in for nasty weather.
One eye is taken for an eye.

Credence Clearwater Revival – Bad Moon Rising

http://www.theburningplatform.com/?p=11590

Ron Paul To Ask Fed: Why After Trillions, Unemployment Still Sky High

Zero Hedge
February 2, 2011

While everyone is relishing the Fed’s third and only mandate these days, namely to send the Russell 2000 to 36,000 and cotton limit up to infinity and beyond, while everyone else is terrified to short stock in advance of what increasingly appears like near certain additional quantitative easing, congressman Ron Paul has announced that the first Monetary Policy subcommittee meeting will focus on one of those two now forgotten Fed mandates, that of creating jobs. “I’m very pleased to hold our first subcommittee hearing in the new Congress on a topic that could not be more critical, namely unemployment.  Despite enormous amounts of monetary and credit expansion by the Federal Reserve in recent years, the nation’s unemployment picture remains bleak.  While many focus on the impact of fiscal policies on employment,  the effect of monetary policy often goes unexamined.  In my view we are now experiencing the bust that inevitably results from the misallocation of capital and human resources in a period of artificially cheap credit.  It is important to understand the Federal Reserve’s role in creating today’s unemployment crisis, while also highlighting that high unemployment and low economic growth can persist even in the face of tremendous monetary inflation.” Of course, the answer to all of these problems is simple: no debt ceiling raise. If the Fed can’t monetize any more debt and make the Primary Dealers ever richer (now that the PD ranks have just been expanded from 18 to 20 to include SocGen and derivative (!) trader MF Global, and its CEO Jon Corzine) from commissions on indirect debt monetization, its power is gone. But that will mean doing something for less theatrical than a few hearings, and far more responsible: such as preventing rampaging inflation across America (see cotton chart posted previously).

Ron Paul questions lack of economic growth

Domestic Monetary Policy and Technology Subcommittee Chairman Ron Paul announced today the Subcommittee will meet for a hearing to examine the impact of Federal Reserve policies on job creation and the unemployment rate. The hearing will be held on Wednesday, February 9th.

Subcommittee Chairman Paul said, “I’m very pleased to hold our first subcommittee hearing in the new Congress on a topic that could not be more critical, namely unemployment.  Despite enormous amounts of monetary and credit expansion by the Federal Reserve in recent years, the nation’s unemployment picture remains bleak.  While many focus on the impact of fiscal policies on employment,  the effect of monetary policy often goes unexamined.  In my view we are now experiencing the bust that inevitably results from the misallocation of capital and human resources in a period of artificially cheap credit.  It is important to understand the Federal Reserve’s role in creating today’s unemployment crisis, while also highlighting that high unemployment and low economic growth can persist even in the face of tremendous monetary inflation.”

The Federal Reserve has taken unprecedented action to provide liquidity to financial markets and some U.S. corporations; however, unemployment remains above 9 percent.  The hearing, entitled Can Monetary Policy Really Create Jobs?, will focus on the Fed’s recent actions, the likelihood those actions will reduce unemployment, and the critical role of the private sector in job creation.

While the Obama administration and Democrats in Congress believe increased government spending will improve the nation’s economy, Republicans on the Financial Services Committee know economic growth depends on providing the private sector, especially small businesses, with the certainty they need to create jobs.  The Fed’s policies, as well as the Obama administration’s unsustainable debt and spending, continue to prevent small business owners from growing and hiring because of continued uncertainty over new taxes, higher interest rates, and the expanding role of government in the economy.

On November 3, 2010, the Federal Reserve announced that it planned to purchase $600 billion in long-term Treasuries (dubbed “QE2”).  This is the second time since the 2008 financial crisis that the Federal Reserve has engaged in quantitative easing. The latest round of quantitative easing, along with the Fed’s action to bailout financial companies, has added trillions of dollars to the government balance sheet.

http://www.infowars.com/ron-paul-to-ask-fed-why-after-trillions-unemployment-still-sky-high/