The Wall Street Journal has an article about the EU entitled, “Currency Union Teetering, ‘Mr. Euro’ Was Forced to Act,” which is worth reading and reflecting on seriously.[2] It represents an excellent discussion of what has happened in the past. However, its conclusions are sobering and ominous:
[F]our months later, the root causes of the Greek crisis remain: There is no central authority to even coordinate national tax-and-spending policies.
In the past month, financial markets have turned their sights on Ireland and Portugal. Doubts remain over the solvency of banks on Europe’s stricken fringe. That leaves them dependent on [the European Central Bank president Jean-Claude Trichet]’s largesse, in the form of “temporary” lending facilities introduced by the ECB when the crisis first hit.
Despite Mr. Trichet’s assurances that the bond-buying program is a stop-gap, it not only continues but has also increased in recent weeks—with no end in sight.
Put succinctly, Europe is still on the brink. It is foolish to believe otherwise. The “green shoots” that have appeared recently are an “illusion” and merely a brief respite in the midst of a maelstrom, which economic historians will describe as the “Great Depression II” (or by some similar name) 20-40 years from now.
Americans and their counterparts around the world have lost faith in their governments, and rightly so[3]; and the governments have come closer to exhausting all of their viable economic options. As this becomes increasingly clear, and as governments thrash about trying to find solutions that do not exist, and as politicians continue to lie—which after all is what they are most proficient at doing—the economic tsunami will continue to take its toll and run its course worldwide during the balance of this decade.
It will get very ugly, economically, socially and politically. Barack Obama will be swept out of office in the United States, and this process has begun already. It will accelerate with November’s elections. He is caught in the twin pincers of an economy in decline that he cannot influence except negatively, and an Afghan war that cannot be won. Republicans and Independents do not support him now; and his own Democrats are deserting him.
The slippery slope out the White House door will follow, like it did for Lyndon Johnson prior to the presidential election of 1968, when the political consequences of the Vietnam war made him unelectable. Obama will return either to Chicago or Honolulu to lick his wounds and set up his presidential library, and assume an “elder statesman” role—similar to Bill Clinton—after only one term in office.
The efforts of Jean-Claude Trichet, or “Mr. Euro,” will prove similar to measures undertaken to put Humpty Dumpty back together again. Trichet is not “Superman,” and he will lack the necessary skills; and the policy options will have been exhausted. Panics may ensue in the financial markets; and the recent crises may seem like child’s play by comparison to what is coming. The “Band-Aids” that Trichet, America’s Federal Reserve Chairman Ben Bernanke and others applied will be ripped asunder as the economic tsunami continues its relentless and unforgiving advance globally.[4]
Hold on tight. It is apt to get very ugly. The euro zone will unravel, which is likely to be a relatively small but critical part of what will be happening worldwide; and financial turmoil will engulf the euro-zone nations. There will be nobody of consequence in charge economically or politically in the United States or other countries. And the human suffering and chaos will be unfathomable.[5] Throw military and national security issues into the mix, and the results may be explosive.
© 2010, Timothy D. Naegele
[1] Timothy D. Naegele was counsel to the United States Senate’s Committee on Banking, Housing, and Urban Affairs, and chief of staff to Presidential Medal of Freedom and Congressional Gold Medal recipient and former U.S. Senator Edward W. Brooke (R-Mass). He practices law in Washington, D.C. and Los Angeles with his firm, Timothy D. Naegele & Associates, which specializes in Banking and Financial Institutions Law, Internet Law, Litigation and other matters (see www.naegele.comand http://www.naegele.com/naegele_resume.html). He has an undergraduate degree in economics from UCLA, as well as two law degrees from the School of Law (Boalt Hall), University of California, Berkeley, and from Georgetown University. He is a member of the District of Columbia and California bars. He served as a Captain in the U.S. Army, assigned to the Defense Intelligence Agency at the Pentagon, where he received the Joint Service Commendation Medal. Mr. Naegele is an Independent politically; and he is listed in Who’s Who in America, Who’s Who in American Law, and Who’s Who in Finance and Business. He has written extensively over the years (see, e.g., http://www.naegele.com/whats_new.html#articles), and can be contacted directly at tdnaegele.associates@gmail.com
[2] See http://www.naegele.com/documents/CurrencyUnionTeeteringMr.EuroWasForcedtoAct.pdf; see also http://online.wsj.com/article/SB10001424052748703467004575464113605731560.html?mod=WSJ_hps_MIDDLETopStories
[3] See, e.g., https://naegeleblog.wordpress.com/2010/09/24/washington-is-sick-and-the-american-people-know-it/
[4] See also https://naegeleblog.wordpress.com/2010/09/09/are-afghanistan-iraq-and-pakistan-hopeless-and-is-the-spread-of-radical-islam-inevitable-and-is-barack-obama-finished-as-americas-president/ and https://naegeleblog.wordpress.com/2010/05/16/will-the-eus-collapse-push-the-world-deeper-into-the-great-depression-ii/
[5] See also https://naegeleblog.wordpress.com/2009/12/16/the-great-depression-ii/#comment-750 and https://naegeleblog.wordpress.com/2009/12/16/the-great-depression-ii/#comment-745
NaegeleBlog 
Ireland, Portugal Stir European Fears
This is the title of a Wall Street Journal article, which goes on to state:
See http://www.naegele.com/documents/IrelandPortugalfuelregionalwoes.pdf
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Another fair assessment of what is going on here in the U.S., and worldwide by Timothy. You said it before, and the Wall Street Gang had better stop sipping Starbucks and heed the warning you are telling us….
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IMF Admits The West Is Stuck In Near Depression
The IMF is conservative, and is reluctant to admit that the “Great Depression II” is upon us, for fear that panics may erode economies even more—which will happen when the economic realities are realized fully around the globe. An article on this subject in UK’s Telegraph is worth reading.
See http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/8039789/IMF-admits-that-the-West-is-stuck-in-near-depression.html
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The situation is grim – probably grimmer than generally realized, but it’s not a foregone unavoidable end that we can’t escape. In general people will try to remove themselves from the path of a speeding train.
Europe is in some ways in better shape. While several countries went too far accumulating debt and entitlements the diversity of problems among several countries will help them. Spain and Ireland and the UK participated with the US in the global excess in housing. Germany, Italy, and others did not. Spain bought into the alternative energy hype and is learning that lesson.
I was surprised at the resurgence of discredited voodoo economic myths in the US and the readiness with which Bush initially and then Obama jumped on the Keynesian stimulus bandwagon. The lesson from the Great Depression and more recently, Japan, is that spending does not itself create sustainable economic growth.
The government here in the US is – by funding Fannie and Freddie takeover of the housing markets – stopping the market prices resetting in housing thereby ensuring no real recovery can take hold. It would be better – would have better – for the government to dismantle the ‘too big to fail’ banks selling off the parts to banks that knew better and to allow prices in the markets to reset providing generous aid to displaced families to get through until recovery got underway. The $800 + billion in stimulus had little to do with the economy and everything to do with political payoffs and payments to states structured to force permanent shift to bigger government.
In any case Europe is in for some tough times ahead. And we are in the same boat with them due to the series of Basel accords regulating banking worldwide. The situation is so difficult in part because of the original Basel accord that took effect in the early 90’s. That global banking agreement was a response, in part, to the Japanese banks rampaging worldwide using cheap money generated by their 1980’s bubble working its way through Japan and spilling out globally via its banks. Basel I was designed to level the field among global banks, but in an example of unintended consequences, it also made sure that any systemic flaws in the accord would impact all the major global banks and their home country financial systems thus laying the groundwork for a series of financial crises globally and the failure eventually of the banking systems.
There were at least two major infections injected into the global system by the original Basel I and that continue into Basel III. Both are partially responsible for the current global downturn and ensure that future crises are more likely – probably inevitable.
One is that Basel decreed that sovereign debt carries zero capital cost. Private debt all carries a higher capital cost. This embedded from the early 90’s into the global financial system a bias towards more sovereign debt ensuring there would be more of it and that it would be cheaper than the natural market rate. This has many implications – none too good – but what it ensured is that all the major global banks carry more sovereign debt on their books than they would have if the rates had to be competitive with private debt.
The European central bank and authorities had a difficult choice forced upon them by Greece. They could allow Greece to default and be forced to immediately deal with the follow-on defaults of almost all of the major banks in Europe (because of the substantial sovereign Greek debt they held), or, they could bail the Greeks out and allow their banks some time to get out of way of the train speeding toward them.
The key fact is that Basel retains the bias that caused the problem to begin with.
The second is that Basel allows major global banks to calculate their own capital requirements and in particular it has a provision that allows one major bank to buy a derivative guarantee from a sibling bank to reduce its capital cost for some particular private asset/exposure. Bank A sells a guarantee to Bank B to greatly reduce its capital cost who sells one to C for its asset who in turn helps A with another. The net effect is that the total capital in the system is woefully inadequate even as every ‘i’ is dotted and every ‘t’ crossed as per Basel.
As far as Obama getting swept out of office, I believe his only hope for re-election is for the Republicans to retake at least the House. The good side to this is that Obama seems too inflexible to take advantage of that situation to triangulate as Clinton so successfully did to get re-election.
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I agree with your first paragraph. My parents lived through the Great Depression of the last century, and did not seem to be affected by it at all.
As to your second paragraph, the only country in Europe that is truly in decent shape economically is Germany, and it cannot carry the rest of Europe. Among other things, its electorate will balk politically.
I agree with your third paragraph.
I agree with your fourth paragraph, and recommend that you read the comments beneath another blog article entitled, “The Great Depression II?”
See https://naegeleblog.wordpress.com/2009/12/16/the-great-depression-ii/
There is a real argument—which I believe is sound—that the downward fall of housing prices should not have been mitigated by foreclosure relief and other factors; and that until housing prices reach their “natural” bottom, or equilibrium, there will not be any recovery in that critical sector of our economy.
Indeed, government interference with free market forces may produce negative results, rather than helping. As you know, the Great Depression of the last century did not end until the onset of World War II, despite the massive governmental programs crafted by Franklin Roosevelt’s administration.
I agree with your comments about Basel. It may well represent a “house of cards” that comes crashing down. Once one or more panics set in, I believe there is nothing that governments will be able to do to stem them. One such “bubble” that I have believed for many years exists in the U.S. relates to mutual funds. Should panics set in and investors seek to cash out of such funds, a liquidity crisis may ensue that cannot be stemmed. The risks of panics such as this one are enormous.
Finally, I agree with your last paragraph, and do not believe Obama is adroit enough to handle the situation. Indeed, the twin pincers of a collapsing economy and a failing Afghan war may overwhelm him personally and politically. Throw in other factors that we do not know about yet (e.g., terrorist attacks), and he may fall like a rock politically. More and more, Americans may conclude that he is “out of touch” and “over his head,” which might result in him being considered “irrelevant” politically and as a leader. I believe he is a “lame duck” now, or will be after the November elections.
Thank you for your thoughtful comments.
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The Chickens Are Coming Home To Roost
There is a plethora of bad news in the media, which will only get worse.
See, e.g., http://www.time.com/time/nation/article/0,8599,2024065,00.html (“Encountering Anguish and Anxiety Across America”) and http://www.bloomberg.com/news/2010-10-05/food-stamp-recipients-at-record-41-8-million-americans-in-july-u-s-says.html (“Food Stamp Recipients at Record 41.8 Million Americans”) and http://news.yahoo.com/s/afp/20101007/bs_afp/forexasiajapanus_20101007100939 (“Dollar tumbles to fresh 15-year low against yen”) and http://www.gallup.com/poll/143426/Gallup-Finds-Unemployment-September.aspx (“Gallup Finds U.S. Unemployment at 10.1%”) and http://www.cnbc.com/id/39626759 (“US Cities Face Half a Trillion Dollars of Pension Deficits”) and http://www.cnbc.com/id/39626607 (“California to Sell 24 Government Buildings”)
The American economy and other economies globally are collapsing. The “Great Depression II” is upon us, which economic historians will describe with some precision 20-40 years from now. Yes, there will be “green shoots” from time to time—as there were during the Great Depression of the last century, which only ended with the onset of World War II, not because of any governmental intervention.
See, e.g., https://naegeleblog.wordpress.com/2009/12/16/the-great-depression-ii and http://www.americanbanker.com/issues/173_212/-365185-1.html and http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html and http://seekingalpha.com/instablog/2951-ilene-at-psw/31177-interview-with-timothy-d-naegele
Even Alan Greenspan—who is responsible for, and triggered the economic calamity that global economies are facing—is forecasting gloom and doom in a Financial Times article entitled, “Fear undermines America’s recovery.” He is the architect of the enormous economic “bubble” that burst globally. No longer is he revered as a “potentate.” His reputation is in tatters, and he is disgraced. Giulio Tremonti, Italy’s Minister of Economy and Finance, perhaps said it best:
That speaks volumes. However, the human suffering and economic devastation that Greenspan’s actions (and inactions) spawned are not limited to the United States, but are truly global in scope.
See http://www.ft.com/cms/s/0/4524339a-d17a-11df-96d1-00144feabdc0.html
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“Green Shoots For Housing Mowed Down”—And Become Dead Weeds
The Wall Street Journal has an article by this title about the American housing market and its effect on the U.S. economy, which states:
See http://www.naegele.com/documents/GreenShootsforHousingMowedDown.pdf
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Keynes Is Dead . . .
John Maynard Keynes was a British economist who advocated the use by governments of fiscal and monetary policies to mitigate the adverse effects of economic recessions and depressions. Contrariwise, Milton Friedman and other economists were pessimistic about the ability of governments to regulate the business cycle with fiscal policies.
A New York Times’ article entitled, “Europe Seen Avoiding Keynes’s Cure for Recession,” states:
See http://www.nytimes.com/2010/10/21/world/europe/21austerity.html?_r=2&hp and http://en.wikipedia.org/wiki/John_Maynard_Keynes
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Ireland’s Fate Tied to Doomed Banks
In a brilliant article with this title, the Wall Street Journal is reporting:
See http://online.wsj.com/article/SB10001424052748704506404575592360334457040.html?mod=WSJ_hp_mostpop_read; see also http://online.wsj.com/article/SB10001424052748704865704575610763484082240.html?mod=WSJ_hp_LEFTWhatsNewsCollection
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Is Europe Collapsing?
In an excellent UK Telegraph article by Ambrose Evans-Pritchard entitled, “Europe stumbles blindly towards its 1931 moment,” it is stated:
See http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/8132689/Europe-stumbles-blindly-towards-its-1931-moment.html (emphasis added); see also http://www.telegraph.co.uk/finance/economics/8135582/Contagion-hits-Portugal-as-Ireland-dithers-on-Rescue.html and http://www.guardian.co.uk/business/2010/nov/15/ireland-portugal-spain-european-debt-crisis and http://www.montrealgazette.com/business/Euro+under+siege+Portugal+hits+panic+button/3831814/story.html and http://www.guardian.co.uk/business/2010/nov/15/greek-deficit-bigger-than-thought and http://online.wsj.com/article/SB10001424052748704584504575616033310586068.html?mod=WSJ_hp_MIDDLENexttoWhatsNewsThird#articleTabs%3Darticle
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British Banks Have $225 billion Exposure To Ireland’s Economic Crisis
UK’s Telegraph is reporting:
See http://www.telegraph.co.uk/news/worldnews/europe/ireland/8141618/British-banks-have-140-billion-exposure-to-Irelands-economic-crisis.html
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Is Europe Collapsing?—Part 2—And America’s State And Local Debt Bomb
Ireland’s coalition government was thrown into turmoil, as Green Party leader John Gormley called for a general election, saying: “People feel misled and betrayed.” The Wall Street Journal is reporting:
See http://online.wsj.com/article/SB10001424052748704243904575630281642245978.html?mod=WSJ_hp_LEFTTopStories
The Journal added:
See http://blogs.wsj.com/brussels/2010/11/21/ireland-greece-numbers/; see also http://www.bloomberg.com/news/2010-11-22/ireland-seeks-european-union-rescue-as-outsized-crisis-overwhelms-nation.html
In an article entitled, “Rescue of Ireland Would Dwarf Greece’s Bailout on Cost of Shoring Up Banks,” Bloomberg is reporting:
See http://www.bloomberg.com/news/2010-11-22/rescue-of-ireland-would-dwarf-greece-s-bailout-on-cost-of-shoring-up-banks.html (emphasis added)
Thus, the bailout of either Spain or Italy would wipe out the entire 750 billion-euro European Financial Stability Facility that was set up in May.
In an article entitled, “Irish EU bailout may not stop Portugal follow-up,” Reuters is reporting:
See http://www.reuters.com/article/idUSTRE6AK2QQ20101122
In an article entitled, “In Bailouts, Spain Will Be ‘the Biggie’: Strategist,” CNBC is reporting:
See http://www.cnbc.com/id/40310940
In the United States, the state and local government fiscal mess is getting worse. The Journal is reporting:
See http://online.wsj.com/article/SB10001424052748704648604575621062239887650.html?mod=WSJ_hps_sections_opinion
In an article entitled “Euphoria or the Obama Depression?” that was published and distributed by the McClatchy Newspapers and McClatchy-Tribune News Service on April 8, 2009, I wrote:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html
As we witnessed in the mid-terms elections on November 2nd, the chickens are coming home to roost. The economic tsunami continues to roll worldwide—with devastating economic and political effects, and enormous human suffering—which will not subside before the end of this decade.
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A Dangerous Bubble Is Emerging In China
This is the title of a Forbes’ article, which adds:
See http://www.forbes.com/2010/11/23/china-tudou-youkou-video-bubble-leadership-managing-rein.html?partner=daily_newsletter; see also https://naegeleblog.wordpress.com/2009/12/16/the-great-depression-ii/#comment-418 (“China’s economy will slow and possibly ‘crash’ within a year as the nation’s property bubble is set to burst”) and http://www.usatoday.com/money/world/2010-08-30-chinesebanks30_ST_N.htm (China’s banking system is showing “disturbing, U.S.-style cracks,” which may entail a full-blown crash of its real estate markets and its economy)
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The Contagion Spreads: EU Rescue Costs Start To Threaten Germany Itself
It was just a matter of time before this happened, with much much worse yet to come.
The UK’s Telegraph is reporting—in an article that is subtitled, “The escalating debt crisis on the eurozone periphery is starting to contaminate the creditworthiness of Germany and the core states of monetary union”:
See http://www.telegraph.co.uk/finance/financetopics/financialcrisis/8160999/EU-rescue-costs-start-to-threaten-Germany-itself.html; see also http://online.wsj.com/article/SB10001424052748704693104575638132375883318.html?mod=WSJ_hp_LEFTTopStories
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Irish Cutbacks Pile It On For “New Poor”
This is the title of a Wall Street Journal article, which adds:
This is still just the tip of an enormous iceberg; namely, the collapse of Ireland financially between now and the end of this decade, with much much worse yet to come.
See http://online.wsj.com/article/SB10001424052748704008704575638841899271092.html?mod=WSJ_hp_LEFTTopStories#articleTabs%3Darticle
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Ireland Is Collapsing, And Aer Lingus Feels It Acutely
In an article entitled, “Flying Through a Storm,” the Wall Street Journal is reporting:
See http://www.naegele.com/documents/FlyingThroughaStorm.pdf
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AMERICA TO BAILOUT EUROPE!
This is a potentially-tragic mistake, which simply underscores the fact that the “Great Depression II” continues to wreak havoc around the world, with no end in sight; and that governments are flailing about, trying to fashion solutions that do not exist. In the process, the human suffering will be historically staggering, rivaling the Great Depression of the last century, or worse.
In an article entitled, “US Ready to Back Bigger EU Stability Fund: Official,” Reuters is reporting:
See http://www.cnbc.com/id/40454469; see also http://www.dailymail.co.uk/news/article-1334871/Is-U-S-set-dragged-Europes-financial-troubles-Euro-soars-amid-claims-America-support-IMF-bailout.html
Europe is collapsing. America’s financial aid would not be happening unless policy makers were panicking. However, if Germany does not want to bail out its neighbors, why should the United States do so, directly or indirectly?
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When Spain goes down sometime this year Europe and the world will experience a Lehman/AIG type panic/collapse scenario that will make 08′ look like disneyland.
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Thank you, Paul, for your comment.
Yes, I agree with you. Greece, followed by Ireland, Portugal, Spain, Italy, and other European countries. It is apt to get very ugly, as you have pointed out.
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American Exceptionalism Endures, But . . .
In a thought-provoking article by U.S. News & World Report’s Mort Zuckerman entitled, “The Danger of a Global Double Dip Recession Is Real,” he writes:
See http://politics.usnews.com/opinion/mzuckerman/articles/2010/11/29/the-danger-of-a-global-double-dip-recession-is-real.html
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European Banks Took Big Slice Of Fed Aid
The Financial Times is reporting:
See http://www.ft.com/cms/s/0/4dd95e42-fd6d-11df-a049-00144feab49a.html#axzz16ueqE7wY; see also http://news.yahoo.com/s/ap/20101201/ap_on_bi_ge/us_fed_crisis_lending and http://www.ft.com/cms/s/0/8a5e3ac4-fd89-11df-a049-00144feab49a.html#axzz16ujNXHeX and http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8175432/UK-banks-borrowed-more-than-640bn-from-US-Federal-Reserve.html (“British banks represented more than a third—about $1.5 trillion—of the $3,300bn lent by the US authorities to prop up the financial sector“)
This is outrageous. Bernie Sanders is correct: the Federal Reserve has become the central bank of the world. However, most importantly, it is a precursor of the future, as the economic tsunami—or the “Great Depression II”—continues to roll worldwide, with devastating effects and unfathomable human suffering.
The worst is yet to come, and American taxpayers will be on the hook, while many are suffering greatly and unemployment and other benefits are being terminated!
See also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1023
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California On The Brink
The UK’s Economist has an article entitled, “The tide begins to turn”—and subtitled, “For once, California’s prospects seem better in the long term than in the short”—which is pure poppycock. The article is worth reading to see how out of touch some people are with respect to the economic realities that are sweeping the world, and will prevail at least through the balance of this decade.
See http://www.economist.com/node/17631115?story_id=17631115
First, I live in Southern California part of the year, where I was born and raised before working nonstop in Washington, D.C. for 21 years. I love the state; however, California’s prospects have not gotten better at all, and its long-term prognosis is even more dire. The state has diversity, great weather and natural beauty, which are perhaps unsurpassed anywhere else in the world. Yet, its parks, libraries, schools and other governmental facilities may be closed; law enforcement may undergo substantial cutbacks; state prisons may have to release significant numbers of inmates, as the Economist points out; and crime may skyrocket.
Second, the Democrats have driven the state into the ground, economically; and at its most crucial moment, they are in charge once again—like putting alcoholics in charge of running the local bar (or pub). Also, they are like Salmon trying to swim upstream, against a strong tide of anti-Obama and anti-Democrat sentiment nationally that was evident in the mid-term elections last month. Independents—of which I am one, and have been for more than 20 years, after having been a Democrat and then a Republican—joined with “disenchanted” Democrats and members of the Tea Party movement nationally to reject Barack Obama and his Democrats resoundingly.
Third, because California is bankrupt, and there is no way that its Democrats—who are responsible for the state’s problems—can sober up all of a sudden, and get “newfound religion,” they will turn to the federal government in Washington to bail them out. However, having worked on and with Capitol Hill for many years, the anti-California sentiment is strong even under the most positive economic conditions, which certainly do not exist today. The country as a whole is hurting, and this will be true for the balance of this decade; and the Republicans who control the House of Representatives are not going to bail out California and its Democrats. They will be made to suffer, at the very moment when the state is hurting most. They will pay dearly for their unbridled Liberalism, which is out of step with the rest of the nation.
Fourth, Barack Obama cannot help California, because any “big-dollar” rescue plans that the state truly needs will be blocked in Congress. Also, he is trying to save his own hide, at a time when we are witnessing his end politically. He will not be reelected in 2012, but he will do everything that he can between now and then in a desperate albeit futile effort to change that result. Helping California while the rest of the nation suffers is not in his best interests, nor does such help bode well for his long-term political survival; however, he may have to try to produce such aid, to keep California’s voters and electoral votes clearly in his column. While the fact that California bucked the national trend and elected Democrats to its statewide offices may be gratifying to him, it does not help him politically with the rest of the country. California is considered to be “la la land” to many Americans and members of Congress, and a land of nonstop “wackos” and “loonies,” and the mid-term election results simply reinforced such impressions.
Fifth, California does not have time to get its economic house in order. Time is not a friend of a state that is effectively on “life support.” Also, all of the political “fairness” reforms that theoretically might be become possible or present in the future—according to the Economist—will not make a tinker’s damn to a state economy that is bankrupt now and in the foreseeable future (e.g., during the balance of this decade). Indeed, economically, they are akin to rearranging deck chairs on the Titanic. With no realistic political or economic possibility of turning back the clock on the damage done to the state by the Democrats in the past, and essentially no chance that the congressional Republicans will bail out the state, the most dire predictions for the rest of this decade are likely to realized in California.
Hold on tight. It is apt to get very ugly for the state, Obama and his Democrats. The chickens are coming home to roost, which is happening in Europe too.
See, e.g., https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/ and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/
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I value your blogs…sometimes a lonely voice I am sure…so I just wanted to send an encouragement email… As we used to say in the 70’s “Keep on truckin’!”
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Thanks so much for your comments, Rod. I really appreciate them. 🙂
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Prince Charles And His Wife Are Attacked
Tragically, chaos and violence are descending on the UK and elsewhere in the world, and this terrifying car attack is merely the tip of an enormous iceberg, which will become all too visible during the balance of this decade. Protesters kicked and splashed paint on a car containing Prince Charles, the heir to the British throne, and his wife Camilla, Duchess of Cornwall, although the couple were unhurt.
See http://www.thisislondon.co.uk/standard/article-23905622-student-protest-mob-attacks-charles-and-camilla-on-fees-riot.do and http://www.dailymail.co.uk/news/article-1337088/TUITION-FEES-VOTE-PROTEST-Charles-Camillas-car-attacked-thousands-students-descend-Parliament.html (“Terrifying moment Charles and Camilla were surrounded by a baying mob and their car attacked in tuition fees riot. . . . In the worst royal security breach for a generation, the car carrying [Camilla] and Prince Charles was kicked, rocked and hit with paint bombs . . . , raising echoes of the 1974 kidnap attempt on Princess Anne“) and http://www.dailymail.co.uk/tvshowbiz/article-1337322/Red-hot-Kylie-greets-Prince-Charles-big-smile-The-Palladium-terrifying-car-attack-way-Royal-Variety-Show.html and http://www.dailymail.co.uk/news/article-1337351/CHARLES-AND-CAMILLA-ATTACK-How-did-close.html; see also http://www.economist.com/node/17677746 (“A more divided world economy could make 2011 a year of damaging shocks“)
The UK’s Economist has an article about the riots in London and the attack on Prince Charles and Camilla, which is worth reading and states in part:
See http://www.economist.com/blogs/bagehot/2010/12/angry_britain&fsrc=nwl
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U.S. Home Values To Drop By $1.7 Trillion This Year
As the “Great Depression II” continues to take its toll during the balance of this decade, Bloomberg is reporting:
See http://www.bloomberg.com/news/2010-12-09/homes-in-u-s-poised-to-lose-1-7-trillion-in-value-this-year-zillow-says.html
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EGADS ! I’m pretty up on what’s happening, but these numbers are astounding ! It makes me wonder if we can survive when people like Pelosi, Harry Reid, Obama and others in that “gang” are still in office.
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The Fed Must Not Be The “World’s Banker”
The Wall Street Journal has an article entitled, “Germany Vows Defense of Euro,” which is worth reading, and states in part:
See http://online.wsj.com/article/SB10001424052748703727804576011553442147030.html?mod=WSJ_hp_LEFTWhatsNewsCollection#articleTabs%3Darticle
If Germany wants to defend the euro, and its people support the use of their resources for that purpose, then so be it. However, America should not waste its resources doing so, directly or indirectly (e.g., through contributions to the IMF). There are enough problems domestically that we should not be bailing out Europe. Indeed, it was a travesty that the Fed bailed out so many European banks. Presumably they have paid back every cent by now.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1029
Ron Paul will be chairman of the Domestic Monetary Policy Subcommittee of the House Financial Services Committee in the 112th Congress, and will oversee the Fed. Hopefully he and other members of the new Congress will look into these issues, and insure that the Fed does not become the “world’s banker,” thereby having the American people become guarantors of Europe or the world’s finances.
The balance of this decade will see mass upheaval globally—politically, economically, socially, militarily, and in a host of other ways. While the United States cannot become an “island,” the American people will hold their elected and appointed officials accountable and responsible to insure that their interests are protected fully at all times, period. Things may get very ugly around the world, and they will demand nothing less. The mid-term elections of 2010 were a precursor of that, with much more to come.
See, e.g., https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/
. . .
Lastly, for those who would argue that the Fed’s actions were necessary and appropriate during the recent financial crises, my response is the following:
We know that European and other banks had huge exposures to American asset-backed securities, and still do. We know too that they needed financing to sustain their positions; and that by obtaining such financing from the Fed, sharper declines in the prices of such securities were averted.
However, the questions today—and when the new Congress assembles, and its committees begin their work—include, but are not limited to whether such financing continues, and the extent of it; whether adequate collateral was obtained and still exists; what exposure the Fed had and still has (e.g., have all extensions of credit been fully repaid, and if not why not, and what entities owe the monies and how much is owed by each, and when repayment in full can be expected).; and what exposure American taxpayers have today, and will have in future crises of this nature?
Rest assured future financial and other crises will come. It is simply a function of time.
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The Lunacy Of The Global Warming Hoax Is In Full Swing [UPDATED]
The UK’s Telegraph has a wonderful article about the “Global Warming” hoax, which discusses the Cancun Climate Change Conference’s plans to cut carbon emissions. Among other things, it states:
See http://www.telegraph.co.uk/earth/environment/climatechange/8196634/Cancun-Climate-Change-Conference-agrees-plan-to-cut-carbon-emissions.html; see also http://online.wsj.com/article/SB10001424052970204301404577171531838421366.html?mod=WSJ_hp_MIDDLENexttoWhatsNewsSecond (“[T]he highest benefit-to-cost ratio is achieved for a policy that allows 50 more years of economic growth unimpeded by greenhouse gas controls”)
One wag concluded—after noting that “the £2.9 billion the [UK] Government will save by increasing tuition fees [and sparking riots in London] matches the amount earmarked for [the] global warming project [of funding windmills in Africa]” (see http://www.telegraph.co.uk/comment/columnists/christopherbooker/8196410/Student-fee-savings-will-fund-windmills-in-Africa.html)—“There is a revolution coming.” Indeed.
Like the “Tooth Fairy” and the “Loch Ness Monster”—and any potency on the part of the hapless UN—the myth of man-made “Global Warming” ranks as one of the great myths of recorded history.
It is only fitting that the countries would gather “at a luxury resort” in Cancun, before they seek to “rape” the world economically. Surely, the battle cry emanating from that seaside resort to the peoples of the world is the one commonly attributed to Marie Antoinette: “Let them eat cake.”
Fortunately, for Americans, the incoming Republicans in Congress will seek to block such nonsense from ever seeing the light of day. Also, with Barack Obama’s presidency sinking into the setting sun, it is doubtful he can do much to change that result. Most importantly for him, he is trying to save his own political hide, which seems beyond redemption.
See, e.g., https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/ and https://naegeleblog.wordpress.com/2010/01/01/barack-obama-america’s-second-emperor/ (see also the comments posted beneath the article)
. . .
As if they were twin omens regarding the “Global Warming” hoax, (1) Cancun was hosting the U.N. climate conference as the temperature plunged to a 100-year record low (see, e.g., http://theweek.com/article/index/210181/irony-alert-the-unusually-chilly-global-warming-summit); and (2) Barack Obama was in Copenhagen accepting a deal without any teeth to address “Global Warming,” in the midst of a blizzard that dumped snow on the Danish capital, and he was met by a blizzard in Washington, D.C. on his return from Denmark (see, e.g., https://naegeleblog.wordpress.com/2010/01/01/barack-obama-america%E2%80%99s-second-emperor/).
. . .
Next, in the United States, arctic air has arrived over the eastern half of the country, and low-temperature records will be broken before it leaves.
See, e.g., http://wattsupwiththat.com/2010/12/30/noaa-on-miami-florida-coldest-december-on-record/ (Coldest December Ever Recorded In Miami, Ft. Lauderdale, Palm Beach, Naples . . .) and http://www.weather.com/outlook/weather-news/news/articles/record-lows-southeast-florida_2010-12-13 and http://www.breitbart.com/article.php?id=D9KBLRDG0&show_article=1 (Columbia, South Carolina has first Christmas snow since records kept in 1887) and http://www.breitbart.tv/atlantas-first-white-christmas-since-1862/ (“Atlanta’s first white Christmas since the Chester Arthur administration [in 1882]“) and http://www.dailymail.co.uk/news/article-1346399/New-York-snow-More-2-000-flights-cancelled-East-Coast.html (“Snow on the ground on 49 of the 50 states as New York shivers through its THIRD storm of the winter“) and http://www.dailymail.co.uk/news/article-1346499/U-S-snow-storms-90-000-plane-passengers-face-delays.html (“90,000 passengers face grounded flights and hours of delays after ‘weather bomb’ hits U.S.“) and http://www.accuweather.com/blogs/news/story/44999/snowstorm-shatters-new-york-ci.asp (“Snowstorm Shatters New York City, Philadelphia Records“) and http://www.dailymail.co.uk/news/article-1351009/New-York-snow-Obama-trapped-traffic-storm-battered-East-Coast.html (“New York suffers the snowiest January in its history“) and http://newsminer.com/view/full_story/17324885/article-Temperatures-fall-to-50-below-in-Fairbanks–small-air-carriers-cancel-flights?instance=home_news_window_left_top_1 (“Temperatures fall to 50 below in Fairbanks; small air carriers cancel flights“) and http://www.dailymail.co.uk/sciencetech/article-2093264/Forget-global-warming–Cycle-25-need-worry-NASA-scientists-right-Thames-freezing-again.html (“Forget global warming. . . . [N]ew figures . . . show no warming in 15 years“) and http://www.climatedepot.com/a/18726/Fmr-Thatcher-advisor-Lord-Monckton-evicted-from-UN-climate-summit-after-challenging-global-warming–Escorted-from-the-hall-and-security-officers-stripped-him-of-his-UN-credentials (The Eco-Nazis Strike Again: “Fmr. Thatcher advisor Lord Monckton evicted from UN climate summit after challenging global warming—’Escorted from the hall and security officers stripped him of his UN credentials'”) and http://www.alaskadispatch.com/article/forget-global-warming-alaska-headed-ice-age (“Forget global warming, Alaska is headed for an ice age“) and http://www.mrc.org/articles/jersey-news-outlet-cries-global-warming-blizzard-approaches (“Jersey News Outlet Cries ‘Global Warming’ as Blizzard Approaches“)
Also, other parts the world are being hit hard too.
See, e.g., http://www.smh.com.au/environment/weather/theres-a-mini-ice-age-coming-says-man-who-beats-weather-experts-20101221-1945a.html (“There’s a mini ice age coming, says man who beats weather experts“) and http://www.dailymail.co.uk/news/article-1339149/Big-freeze-Coldest-December-100-years-brings-travel-chaos-holiday-rush-begins.html (“Coldest December since records began [in 1910] . . . across Britain“); see also http://www.dailymail.co.uk/sciencetech/article-1340436/Why-cold-warm-Greenland-Diverted-jet-stream-letting-icy-blast-Arctic.html (“How a freak diversion of the jet stream is paralysing the globe with freezing conditions”) and http://news.xinhuanet.com/english2010/world/2010-12/29/c_13668400.htm (“Berlin sees most snow in December since 1900s“) and http://www.dailystar.co.uk/news/view/169577/Winter-may-be-coldest-in-1000-years/ (“[UK] Winter May Be Coldest In 1000 Years“) and http://www.telegraph.co.uk/topics/weather/9710681/Britain-prepares-for-ice-and-snow-in-cold-snap.html (“Britain prepares for ice and snow . . . [and is] gearing up for what could be Britain’s coldest winter in 100 years“) and http://hosted.ap.org/dynamic/stories/A/AS_CHINA_COLDEST_WINTER?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2013-01-05-07-52-05 (“CHINA’S COLDEST WINTER IN DECADES AT NEW LOW“) and http://www.telegraph.co.uk/topics/weather/9950516/Worst-March-snow-for-30-years-brings-chaos.html (Britain: “Worst March snow for 30 years brings chaos”)
. . .
The very idea that monies should be provided to help China and India switch to renewable energy sources, including wind and solar power, is among the greatest lunacies of all. Two of the real tigers of world economic development now and in the future need such “help” about as much as Barack Obama needs more help in having his narcissistic ego stroked!
See https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-2315 (“Will Obama ‘Unravel’ Like Nixon Did?”); see also http://www.washingtontimes.com/news/2013/feb/4/goodbye-prius-japan-carmakers-drop-electric-car-de/ (Screw the eco-Nazis: “Goodbye, Prius? Japanese carmakers drop battery electric-car development”) and http://www.telegraph.co.uk/earth/environment/globalwarming/9919121/Look-at-the-graph-to-see-the-evidence-of-global-warming.html (“[UK’s] Met Office data show only a tiny change in world temperatures”—”The actual changes look relatively so small, compared with those rises and falls of several whole degrees the world survived in the past, that any idea that we are facing catastrophic warming pales into insignificance. . . . The price we are all increasingly having to pay for [our politicians’] gullibility is incalculable”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2517 (“The Great Green Con—”Global Warming” Is A Myth“) and http://www.telegraph.co.uk/earth/environment/climatechange/10086694/Tim-Yeo-humans-may-not-be-to-blame-for-global-warming.html (“[H]umans may not be to blame for global warming”) and http://www.climatedepot.com/2013/09/14/earth-gains-a-record-amount-of-sea-ice-in-2013-earth-has-gained-19000-manhattans-of-sea-ice-since-this-date-last-year-the-largest-increase-on-record/ (“Earth Gains A Record Amount Of Sea Ice In 2013 — ‘Earth has gained 19,000 Manhattans of sea ice since this date last year, the largest increase on record’“) and http://blogs.telegraph.co.uk/news/jamesdelingpole/100238047/global-warming-believers-are-feeling-the-heat/ (“Global warming believers are feeling the heat”—”[T]hose many alarmists whose careers depend on talking up the threat . . . [are not] winning the war to persuade the world of the case for catastrophic anthropogenic climate change [] but that the battle is all but lost”)
. . .
It is wonderful news that those who have preached “The Global Warming Hoax,” and “The Great Green Con” are and will be getting hurt. Bravo. Fraudsters deserve nothing less!
Perhaps they can shift to the “Flat Earth Society” and have better luck there.
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Low Rates Fail To Rescue Indebted Britain, The Eurozone Is In Need Of An Undertaker, The Euro Has One-In-Five Chances Of Survival, Market Alarm As US Fails To Control Biggest Debt In History, And China’s Property Bubble Has Grown So Huge That 85 Percent of Chinese Living In Cities Cannot Afford A Home
These and other sobering headlines appear in articles around the world. The chickens are coming home to roost, bigtime. Hold on tight. As I have mentioned repeatedly, things will get very ugly worldwide—politically, economically, socially, militarily, and in a host of other ways—during the balance of this decade, which will see mass upheavals globally.
See http://www.telegraph.co.uk/finance/economics/8197806/Low-interest-rates-failing-to-rescue-British-households-from-1.45-trillion-debts-says-Bank-of-England.html and http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/8197780/The-eurozone-is-in-bad-need-of-an-undertaker.html and http://www.telegraph.co.uk/finance/economics/8197655/Euro-has-one-in-five-chance-of-survival-warns-CEBR.html and http://www.telegraph.co.uk/finance/comment/liamhalligan/8196283/Market-alarm-as-US-fails-to-control-biggest-debt-in-history.html and http://www.telegraph.co.uk/finance/china-business/8195879/85pc-of-urban-Chinese-cannot-afford-to-buy-a-home-as-inflation-accelerates.html
As noted in the posting directly above, one wag has concluded: “There is a revolution coming.” This is not beyond the pale!
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Europe Will Be Broken By Crises
This is a conclusion—or verdict—reached in a Wall Street Journal article by Bret Stephens entitled, “Europe Needs a Tea Party,” which is worth reading. In it, he adds:
See http://www.naegele.com/documents/Stephens-EuropeNeedsaTeaParty-WSJ.com.pdf (emphasis added)
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The Great Depression II
Despite the “green shoots”—or promising economic news, which seems to be present on both sides of the Atlantic and elsewhere in the world—one must never forget that the same thing occurred during the Great Depression of the last century too. Yet, we did not emerge from that depression until the onset of World War II.
Vernon L. Smith, Nobel Laureate in Economics, and Steven Gjerstad wrote last year in the Wall Street Journal:
See http://online.wsj.com/article/SB123897612802791281.html
These words were sobering then, and they are sobering now. Indeed, the predictions that I made last year have been coming true as well:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html; see also http://seekingalpha.com/instablog/2951-ilene-at-psw/31177-interview-with-timothy-d-naegele
What happened in last month’s mid-term elections in the United States is just the beginning, with much more to come.
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The Ghost Towns Of China
The UK’s Daily Mail is reporting:
See http://www.dailymail.co.uk/news/article-1339536/The-ghost-towns-China-Amazing-satellite-images-cities-meant-home-millions-lying-completely-deserted.html
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With The Collapse Of Its Economy, The Celtic Tiger’s Property Empire Unravels
The UK’s Telegraph is reporting:
See http://www.telegraph.co.uk/finance/financetopics/financialcrisis/8211753/Irelands-UK-property-empire-unwinds-as-it-sells-London-assets.html
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China Ready To Bail Out The EU?
In an article entitled, “Fresh humiliation for eurozone as China says it will bail out debt-ridden nations,” the UK’s Daily Mail has reported:
See http://www.dailymail.co.uk/news/article-1341110/Fresh-humiliation-euro-zone-China-says-bail-debt-ridden-nations.html and http://news.smh.com.au/breaking-news-world/china-backs-spain-to-emerge-from-crisis-beijing-20110103-19dys.html (“Beijing will buy Spanish public debt“)
. . .
In an article insert, the Daily Mail added:
See id.; see also https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-1188
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2011: The World Will Be Grimmer
This is the judgment of Gideon Rachman, chief foreign-affairs commentator of the UK’s Financial Times, in an article that he has written for the UK’s Economist, which is worth reading:
See http://www.economist.com/node/17493390
What Rachman does not acknowledge is that the world is in the throes of the “Great Depression II” already, which economic historians will describe as such—or by using similar terms—20-40 years from now. Yes, there are “green shoots” of economic recovery, but those too will fade and become “dead weeds,” just as they did during the Great Depression of the last century. The very factors that Rachman describes will contribute to this process, and accelerate its progress. One must remember that the last Great Depression did not end until the onset of World War II; and no amount of government intervention changed that result.
What Rachman does not mention are other factors that possibly may be even more ominous, such as a shooting war on the Korean Peninsula (see, e.g., https://naegeleblog.wordpress.com/2010/12/22/the-next-major-war-korea-again); a war between Israel and Iran or its surrogates; Barack Obama’s deteriorating Afghan war, and the effects it will likely have on the American psyche, which may be reminiscent of the Vietnam war and its consequences; and the list goes on and on—with respect to possible “shocks.”
What is certain is that 2011 will hold surprises that none of us can predict. Hold on tight. Things will get very ugly during the balance of this decade.
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California’s Cuts Will Be Dramatic
The Los Angeles Times has an article about incoming-Governor Jerry Brown’s budget plans for the state, which are likely to be draconian but necessary. Having advised his administration with respect to banking matters the last time he was the state’s governor, I am not surprised that austerity measures will be implemented.
There are likely to be massive cuts in governmental services that Californians have taken for granted, such as libraries, parks, education, law enforcement and prisons, with commensurate increases in crime and an overall deterioration in the quality of many lives.
The Times’ article entitled, “Jerry Brown plays hardball on state budget”—and subtitled, “His plan will confront both parties, with calls for tax extensions and deep program cuts”—is worth reading. There are few people who know more about California’s government than Jerry Brown.
See http://www.latimes.com/news/local/la-me-budget-20101229,0,6267084.story
As the economic decline continues globally, nationally and in California during the balance of this decade, Jerry Brown is correct in doing what this article indicates. There can be no “sacred cows” in terms of budget cutting.
For example, as higher education shifts more and more to the Internet, and the Middle Class is priced out of extravagant college educations for their children, changes are automatic. Bricks-and-mortar spending is a thing of the past, especially when classes can be recorded and shown again and again on YouTube; and virtual universities become the new “norm” in terms of education.
Indeed, one can walk through the lovely college campuses of today and look at dinosaurs. Like newspapers, they are relics of a bygone era. Economics alone dictates this result. Romanticism has no place in budget planning.
Once all of the fat is wrung out of state spending that is possible, the new governor’s only viable option will be to seek help from Washington. Other states and government entities will be doing the same; and the line will be long. Yes, California will be met with resistance and even hostility by the new Republican House, because of California’s Democrat base, Democrat-controlled legislature, Democrat governor, and Democrat senators, but there is no other choice.
Hold on tight. Things will get very ugly.
See also http://lamesa.patch.com/articles/there-outta-be-a-law-californians-getting-725-new-ones-in-2011 (“Californians Getting 725 New [Laws] in 2011”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1074 (“California On The Brink“)
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Obama Vacations In Hawaii While Much Of The Nation Suffers—And Has The Gall To Advocate “Global Warming” Curbs!
Barack Obama vacations in Hawaii, while much of the United States is suffering from freezing temperatures and massive, unprecedented snows. Or as Michelle Obama has said, paraphrasing her: “Let them eat cake!”
See http://washingtonexaminer.com/blogs/beltway-confidential/2010/12/president-and-family-multi-million-dollar-christmas-vacation-hawa and http://www.breitbart.com/article.php?id=CNG.894f9613dde7faf0e564d8d311b3922e.131&show_article=1 and https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-1172 and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1127
Indeed, Obama’s White House plans to push “Global Warming” policies, despite the fact that “Global Warming” is a fraud and a hoax.
It has been reported, from Honolulu:
See http://www.foxnews.com/politics/2010/12/28/white-house-plans-push-global-warming-policy-gop-vows-fight/
We can all remember how much of a fight the inept Republicans put up during the 2010 lame-duck session of Congress, when Obama and his Democrats rolled them!
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The World At War
Foreign Policy has a piece entitled, “Next Year’s Wars”—and subtitled, “The 16 brewing conflicts to watch for in 2011″—which is worth noting. However, it does not include a possible war on the Korean Peninsula, which might prove catastrophic.
See http://www.foreignpolicy.com/articles/2010/12/28/next_years_wars?page=full and https://naegeleblog.wordpress.com/2010/12/22/the-next-major-war-korea-again/
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The Current Financial Crisis Is The Second Great Depression
These are the words of American political pundit Ann Coulter in an article entitled, “Investigate This!”—which is worth reading.
Coulter adds:
See http://www.humanevents.com/article.php?id=41005
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What Remains Of An Undergraduate Degree In Economics
As indicated above and elsewhere in my writings, I believe:
Having read this, a Wall Street Journal contributor brought words by economist Joan Robinson to my attention, which are wise and worthwhile repeating:
See, e.g., http://en.wikiquote.org/wiki/Joan_Robinson; see also http://en.wikipedia.org/wiki/Joan_Robinson
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China On “Collision Course” With USA
In an important article about China—which is subtitled, “We all learned at school how the status quo powers mismanaged the spectacular rise of Germany before World War I, a strategic revolution so like the rise of China today”—the UK Telegraph’s Ambrose Evans-Pritchard has written:
See http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/8277143/Appeasement-is-the-proper-policy-towards-Confucian-China.html (emphasis added)
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Bank of England Governor Warns: Standard Of Living To Plunge At Fastest Rate Since 1920s
As reported in the UK’s Telegraph, Bank of England chief Mervyn King warns that households face the most dramatic squeeze in living standards since the 1920s:
See http://www.telegraph.co.uk/finance/economics/8282354/Bank-of-England-chief-Mervyn-King-standard-of-living-to-plunge-at-fastest-rate-since-1920s.html; see also http://www.dailymail.co.uk/news/article-1350557/This-biggest-squeeze-families-1920s-warns-Bank-England-chief.html (“Mervyn King painted a picture of the nightmare facing millions of workers because of the toxic combination of soaring inflation and pay freezes or paltry pay rises“)
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Will Obama Dig Us Out Of The Second Great Depression? Do You Believe In The Tooth Fairy?
In another scintillating and scorching column, Ann Coulter writes:
See http://www.humanevents.com/article.php?id=41419
Even more sobering than Ann Coulter’s often humorous insights is a Wall Street Journal editorial entitled, “After You, Mr. Ryan”—and subtitled, “The President says the deficit is the GOP’s problem now”—which states in pertinent part:
See http://online.wsj.com/article/SB10001424052748703293204576106293283157786.html?mod=WSJ_Opinion_LEADTop
Having let former House Speaker Nancy Pelosi and her fellow Democrats in Congress write the legislation that has put our great nation in its present financial bind, it is not surprising that Obama would once again abdicate his responsibilities and try to shift blame to others.
The Journal’s editorial continues:
Again, Obama is a far-Left, anti-war, raving narcissist who has been weakening this great nation at every turn since he became the president. He must be removed from office at the earliest date possible, before he can do even greater damage.
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The Scent Of Jasmine Spreads
This is the title of an article in the UK’s Economist—about the protests in Tunisia that toppled its government, and in Yemen and Egypt—which is worth reading.
See http://www.economist.com/node/18010573?story_id=18010573&fsrc=nlw|hig|01-27-2011|editors_highlights; see also http://www.telegraph.co.uk/news/worldnews/africaandindianocean/egypt/8289686/Egypt-protests-Americas-secret-backing-for-rebel-leaders-behind-uprising.html (“Egypt protests: America’s secret backing for rebel leaders behind uprising”) and http://blogs.abcnews.com/politicalpunch/2011/01/axelrod-president-obama-has-on-several-occasions-directly-confronted-mubarak-on-human-rights-for-the.html
After Tunisia, Yemen and Egypt, where will the chaos spread next, and topple governments? Jordan, other Arab countries (including Iran), Europe, Russia, North Korea, China, the UK, America and beyond? Farfetched, you say? Think again.
As I have written, the world is in the throes of the “Great Depression II,” which economic historians will describe as such (or by using similar terms) 20-40 years from now. Yes, there will be “green shoots” from time to time, indicating that a recovery is underway, just as such signs appeared during the last Great Depression—which only ended with the onset of World War II.
The politicians on both sides of the Atlantic are flailing around, trying to come up with solutions, when there are none. Not only is there a yearning for democracy, but the world is facing economic problems that have not been seen since the last Great Depression. As I wrote more than a year ago:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html; see also http://seekingalpha.com/instablog/2951-ilene-at-psw/31177-interview-with-timothy-d-naegele
Hold on tight. Things will get very ugly. The chickens are coming home to roost, in the Middle East and elsewhere. In all likelihood, cowardly anti-war President Barack Obama—who failed to come to the aid of those courageous Iranians who were tortured and killed after rising up in protest against the disputed victory of President Mahmoud Ahmadinejad, following the 2009 Iranian presidential election—and other politicians will be swept out of office. And yes, “the scent of the jasmine revolution,” as the Tunisians are calling their national upheaval, is in the process of spreading worldwide.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/ and https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/; see also the comments beneath both articles
The Economist has said:
See http://www.economist.com/node/18010573?story_id=18010573&fsrc=nlw|hig|01-27-2011|editors_highlights
This may be true of other people too—for example, in Iran, North Korea and eventually Russia and China—or chaos might reign. Whatever the future holds, we may be living in a decade that truly changes lives as well as the world.
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Will Barack Obama Go Down In History As The President Who Lost The Middle East?
As I have written:
See https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected
He is a cowardly demagogue, who failed to come to the aid of those courageous Iranians who were tortured and killed after rising up in protest against the disputed victory of President Mahmoud Ahmadinejad, following the 2009 Iranian presidential election.
It was a seminal moment in Obama’s presidency up to that point in time. He flinched, and demonstrated to the world that he is not a true small-“d” democrat; and that he is weak like Jimmy Carter was. He stood with our enemy, the theocracy in Iran.
With respect to Egypt, the United States must do whatever is necessary to make sure that radical Islam does not take over the country. If it happens, and if that spreads—for example to Jordan, another ally of ours and of Israel—at the very least Obama will go down in history as the president who lost the Middle East. Also, this might determine the fate of Israel.
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1344; but see http://online.wsj.com/article/SB10001424052748703833204576114252976824050.html?mod=WSJ_Opinion_LEADTop (“Egypt . . . has the opportunity to become what it always should have been—the leader of a movement toward freedom and democracy in the Arab world”)
Political pundit and former Bill Clinton adviser, Dick Morris, has warned:
See http://www.dickmorris.com/blog/who-lost-egypt/
The United States cannot afford to lose Egypt, Jordan and other allies in the region. Among other things, Obama is pulling our forces out of Iraq; and a debacle is likely to follow in Afghanistan too, which seems to be a lost cause. All of this might determine the fate of Israel.
See, e.g., http://news.yahoo.com/s/ap/20110201/ap_on_re_mi_ea/ml_iraq;_ylt=Akg0dRp1i4NSyUsUi6YKt.0LewgF;_ylu=X3oDMTJkdnRuaHE2BGFzc2V0A2FwLzIwMTEwMjAxL21sX2lyYXEEcG9zAzEEc2VjA3luX3BhZ2luYXRlX3N1bW1hcnlfbGlzdARzbGsDc2VuYXRlcmVwb3J0 (“American diplomats and other mission employees may not be safe in Iraq if the U.S. military leaves the volatile country at the end of the year as planned, according to a new report released [by the U.S. Senate Foreign Relations Committee]”)
As I have written:
See https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected (emphasis added)
Obama might tragically alter America’s history by losing the Middle East.
The Israelis are deeply and justifiably concerned. In an important article entitled, “Israel shocked by Obama’s ‘betrayal’ of Mubarak,” Reuters has reported:
See http://www.reuters.com/article/2011/01/31/us-egypt-israel-usa-idUSTRE70U53720110131; see also http://apnews.myway.com/article/20110130/D9L2Q1Q00.html (“If Egypt resumes its conflict with Israel, Israelis fear, it will put a powerful Western-armed military on the side of Israel’s enemies while also weakening pro-Western states like Jordan and Saudi Arabia”)
Also, in an article captioned, “Israel Watches ‘Regional Earthquake’ in Egypt,” the Wall Street Journal has reported:
See http://www.naegele.com/documents/IsraelWatchesRegionalEarthquakeinEgypt.pdf
The battle of Cairo has begun, just as battles have begun elsewhere in the Middle East. They will be ugly and brutal. When the dust settles finally, America’s “Hamlet on the Potomac”—or “Jimmy Carter-lite”—Barack Obama might have lost the region, just as Carter lost Iran to Islamic fascists. The consequences will be mind-boggling.
See also http://online.wsj.com/article/SB10001424052748703445904576117801815760950.html?mod=WSJ_hp_LEFTTopStories#articleTabs%3Dinteractive (The Wall Street Journal’s Interactive Timeline of “Regional Upheaval” in the Middle East)
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American Home Ownership Falls to Preboom Levels
The Wall Street Journal is reporting:
See http://online.wsj.com/article/SB10001424052748704254304576116402472968150.html?mod=WSJ_newsreel_us
The trends described in this Journal article are apt to continue and get much worse between now and the end of this decade, as the “Great Depression II” continues to take its toll. Yes, there will be “green shoots” from time to time just as there were during the Great Depression of the last century, leading some people to believe that the worst has passed. However, only “dead weeds” or disappointments and fears are likely to follow.
See also http://www.latimes.com/business/la-fi-cash-only-20110301,0,2765168,full.story (“Cash-only home sales rise in California”) and http://www.usatoday.com/money/economy/housing/2011-05-26-foreclosure-discounts_n.htm (“Foreclosure homes are selling at a 27% discount to non-distressed properties nationwide, but discounts are far larger in some states”) and http://www.msnbc.msn.com/id/43175612/ns/business-personal_finance/ (“Sales of homes in some stage of foreclosure . . . accounted for 28 percent of all home sales—a share nearly six times higher than what it would be in a healthy housing market. . . . ‘It’s an astronomically high number'”)
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Ireland: An Age Of Recklessness
The BBC News has an article entitled, “Loss of faith in the Irish fairy tale,” which is worth reading.
See http://news.bbc.co.uk/2/hi/programmes/from_our_own_correspondent/9401513.stm
What this article does not state—but it should—is that the worst is yet to come. While house prices have collapsed already, and there are empty houses that nobody will buy, Ireland has not even seen the half of it.
The economic tsunami is still rolling worldwide that has given rise to the “Great Depression II”—which economic historians will describe as such (or by using similar terms) 20-40 years from now—and it might not end during this decade. Irish property values will crash even more, perhaps declining another 50 percent; and the bottom is nowhere in sight.
The writer of the BBC article noted:
This is simply the tip of an enormous iceberg. As I wrote almost two years ago:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html
The chickens are coming home to roost, and Ireland will be hit harder than most countries.
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The New Wave Of Emigration Dooms Ireland, And Even Guinness Reels
The Wall Street Journal has an important article that describes the new wave of Irish emigrants who are turning their backs on the Emerald Isle, which is mired in an economic collapse—and is likely to sink even farther during the balance of this decade. The article is worth reading, and states in pertinent part:
See http://www.naegele.com/documents/IrelandHasFlashbacksasThousandsEmigrateforBetterLife.pdf (“Irish Remedy for Hard Times: Leaving“); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1442 (“Ireland: An Age Of Recklessness“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1018 (“Ireland Is Collapsing, And Aer Lingus Feels It Acutely“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1011 (“Irish Cutbacks Pile It On For ‘New Poor’“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-980 (“British Banks Have $225 billion Exposure To Ireland’s Economic Crisis“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-951 (“Ireland’s Fate Tied to Doomed Banks“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-779 (“Ireland, Portugal Stir European Fears“)
. . .
Lastly, the Wall Street Journal has an article entitled, “As Ireland Staggers, Guinness Reels,” which describes Ireland’s other woes:
See http://www.naegele.com/documents/IrelandsWoesDealBlowtoGuinness.pdf
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An Epic Political Moment Of Singular Clarity
This is in essence how the Washington Post’s Charles Krauthammer has described the turmoil gripping statehouses in Wisconsin, Ohio, Indiana and soon others. He has written another terrific column, which states in pertinent part:
See http://www.washingtonpost.com/wp-dyn/content/article/2011/02/24/AR2011022406520.html
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Bernie Madoff: The Market Is A Whole Rigged Job, And There’s No Chance That Investors Have In This Market [UPDATED]
Convicted swindler and consummate narcissist Bernard Madoff is serving a 150-year sentence at the Federal Correctional Institution in Butner, North Carolina for his $65 billion Ponzi scheme. He was interviewed by New York Magazine, and its terrific article states in pertinent part:
See http://nymag.com/news/features/berniemadoff-2011-3/ (emphasis added); see also http://online.wsj.com/news/articles/SB10001424052702303722104579242703723473552 (“My Interview With Madoff”)
Madoff’s views are consistent with my own—especially about “technical traders,” and the fact that average Americans should not be in the stock market at all—which are discussed in an October 2009 interview:
See http://seekingalpha.com/instablog/2951-market-shadows/31177-interview-with-timothy-d-naegele; see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3150 (“Fed Is Creating The Mother of All Bubbles“)
As the economic tsunami continues to roll worldwide, other market fraud and vulnerabilities will be exposed, which might make Bernie Madoff’s machinations seem like child’s play.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/
. . .
Also, in a fascinating Lara Logan interview with Las Vegas sports betting legend Billy Walters, CBS’ “60 Minutes” reported:
See http://www.cbsnews.com/stories/2011/01/13/60minutes/main7243443.shtml?tag=currentVideoInfo;segmentTitle (emphasis added) and http://www.cbsnews.com/video/watch/?id=7253011n&tag=related;photovideo
Walters’ views are consistent with those of Bernie Madoff and my own.
Also, in a Wall Street Journal article about Walters, it is reported:
See http://online.wsj.com/article/SB10001424052748703385404576259261181427714.html?mod=WSJ_hps_sections_realestate (emphasis added); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3176 (“The Higher Home Prices Rise, The Farther They Will Fall When The Bubble Bursts“)
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Preserving And Enhancing America’s Military Might During Difficult Economic Times, And Forever
Author Mark Helprin wrote a fine article in the Wall Street Journal about the need to maintain America’s Navy, and not allow it to decline. I agree with his goals completely.
See http://www.naegele.com/documents/TheDeclineofUSNavalPower.pdf
However, there is more to this issue that must be noted.
First, those who venture close enough to the Somali coast to place themselves at risk should not expect the U.S. Navy to rescue them.
It has been suggested that a joint military effort be undertaken by all the countries whose ships have been attacked or are at risk. My understanding is that there are joint operations globally to defend critical shipping lanes. Indeed, even China has contributed military forces to those efforts.
See, e.g., http://www.economist.com/blogs/asiaview/2011/03/chinas_foreign_policy
Yes, it might be ironic if China were to unleash a crippling attack on the Somali pirates and their bases, and thereby earn the respect and admiration of people worldwide. However, the Somali pirates are like gnats: bothersome, but not really dangerous in terms of America’s global commitments.
Yes too, the recent killing of the four sailors went awry, as any hostage taking negotiations can do. I concur that the Somali thugs should be terminated.
Second, Helprin noted: “[W]e are in effect an island nation.” This is how most Americans view their country. Many have never flown on an airplane, nor ventured far from where they grew up; and it is surprising how many sophisticated, wealthy, educated Americans have never been to Europe, or out of the States, or to other parts of the world. Their views are insular, which is reflected in American policies and outlook.
I believe in our great country, and in the inherent wisdom of the American people, and my comments are not intended to disparage them one iota.
See https://naegeleblog.wordpress.com/2010/02/26/america-a-rich-tapestry-of-life/
Third, I concur with Helprin that vital U.S. national security and economic interests demand a large blue-water fleet. He adds: “As China’s navy rises and ours declines, not that far in the future the trajectories will cross.” I concur with that conclusion too. Both China and “dictator-for-life” Putin’s Russia are our enemies, now and in the future.
See https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/ and https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/ (see also the footnotes and comments beneath both of these two articles)
Fourth, Helprin states:
I agree; and the same thing is true of other vital military needs and expenditures. Tragically, at present, we have a naïve, anti-war, far-Left, “Hamlet on the Potomac”—or “Jimmy Carter-lite”—narcissistic president, who is a cowardly demagogue. He is determined to weaken our great nation at every turn; and he must not be reelected.
See https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/ and https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/ (see also the footnotes and comments beneath both of these two articles)
Fifth, it has been suggested that American military expenditures are equal to many times what the next countries combined are spending. Hence, the question arises: where is the money going?
There is no question that—like it or not—the United States must maintain its absolute superiority now and in the future. No nation must be in a position to ever challenge us. Our very survival depends on it.
See, e.g., https://naegeleblog.wordpress.com/2010/01/19/emp-attack-only-30-million-americans-survive/
As I told a friend recently, who had commented on a Pentagon report that China may have triggered our economic crash:
See, e.g., https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/#comment-1467
I spent two years working at the Pentagon in intelligence, and then I have worked on and with Capitol Hill for most of my legal career. During this time, I have had an opportunity to see many federal government agencies and programs in action; and I can honestly say that the Pentagon is the best by far. There is no agency or program that is even remotely close.
The people who work at the Pentagon and serve our military—both in uniform and as civilians—are totally dedicated and professional; and they have inspired enormous pride in me over the years. If you read any of my articles, you will realize that I do not spare my criticism of people and institutions; and I am not naïve. Some people might assert that I am cynical; I prefer to believe that I am an idealist, who is repulsed when I encounter something that is less than just or the best.
The Pentagon and our military are not perfect, but they are truly excellent. There are reasons why the Soviet Union collapsed and we are the only superpower in the world today. It did not just happen by chance.
This enormous power must be maintained and nourished. I will repeat—because it deserves emphasis again and again—our very survival depends on it. This is not a “Mary Poppins” world in which we live. There are countries and terrorist groups around the world that want to destroy our great nation, and kill all of us. This is a fact of life, period.
What follows are the comparative numbers relating to our military expenditures vis-à-vis those of other countries. There may be more recent numbers that are available publicly, but I have not seen them.
See http://en.wikipedia.org/wiki/List_of_countries_by_military_expenditures#Chart_by_country_or_organization
For better or worse, America protects the free world; we encourage those countries and people who yearn for democracy and freedom; we are winding down a very successful war in Iraq, which I questioned and opposed at the outset, but was impressed that George W. Bush’s “surge” worked and won that war; we are mired in the Afghan War, which Barack Obama does not seem to have the will or determination to win; and we have commitments that are essentially endless.
We have no allies that are capable of doing any “heavy lifting” today. The UK is “gutting” its military; NATO is a mere shell of what it once was; and we are it—with very heavy duties and responsibilities. After having worked in and with government for so many years, I believe government is a vast wasteland, most of which should be eliminated. The one exception would be the Pentagon and our brilliant and, yes, wonderful and awe-inspiring military forces.
. . .
Update:
The UK’s Daily Mail has reported:
See http://www.dailymail.co.uk/news/article-1365156/14-Somali-pirates-accused-killing-U-S-sailors-appear-Virginia-court-yacht-hijack.html (“14 Somali ‘pirates’ accused of killing four U.S. sailors appear in Virginia court over yacht hijack”)
Thus, even though the four sailors apparently placed themselves at risk by venturing into dangerous waters, and they should not have expected the U.S. Navy to rescue them, nonetheless the Navy attempted to do so and is bringing their killers to justice. It is another example of our brilliant military at work.
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World’s Biggest Bond Fund Eliminates U.S. Government-Related Debt
Bloomberg has reported:
See http://www.bloomberg.com/news/2011-03-09/gross-drops-government-debt-from-pimco-s-flagship-fund-zero-hedge-reports.html (emphasis added)
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Among The Many Reasons Why Obama Must Go
The Wall Street Journal has an interesting article—which was written by a member of the European Parliament, Daniel Hannan—that essentially articulates the reasons why Barack Obama must not be reelected, and how he is leading America is the wrong direction. In it, he states in part:
See http://online.wsj.com/article/SB10001424052748703559604576176620582972608.html?mod=WSJ_hps_sections_opinion#articleTabs%3Darticle
Clearly, Europe is not in great shape economically; and it will get far worse between now and the end of this decade.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally (see also the footnotes and comments beneath the article)
Clearly too, while Obama might want “a less arrogant America,” he personifies arrogance and narcissism.
He wants “a transfer of sovereignty to global institutions.” After all, he never set foot on the American mainland until he attended Occidental College in Los Angeles and Columbia University in New York City. When he was there, he described his presence as follows:
His core beliefs are at odds with those of most Americans, which would have been evident if we had read his book, “Dreams from My Father,” before the 2008 election.
Also, Hannan is correct that Obama is pursuing “a program of comprehensive Europeanization,” despite his ingrained disdain for British and European cultures, which shines through in his book.
See https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/
Next, Hannan asks and answers his own question: “Is a European future truly so terrible?” Yes, he says; and as mentioned above, economically this is likely to be true, and socially too. Also, NATO is a mere shell of its former self; and militarily, the countries of Europe are pathetically weak.
Hannan makes an interesting observation that “an entire political class has grown up [in Europe] believing not just in the economic superiority of euro-corporatism but in its moral superiority.” Lacking the core beliefs of most Americans because of his heritage, Obama feels essentially the same way and has acted on such core beliefs.
Lastly, on balance, Hannan’s observations are correct, which is why Obama and the Democrats were rejected in last year’s mid-term elections, and why the same thing is likely to happen next year as well. The American people have had their fill of the grand “Obama experiment,” and will reject him like they rejected Jimmy Carter in 1980.
Indeed, as mentioned above, it has been said:
This is an understatement.
See https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected (see also the footnotes and comments beneath the article); see also http://online.wsj.com/article/SB10001424052748704893604576200910152041584.html?mod=WSJ_hps_sections_opinion (“When the U.S. fails to lead, every nation recalibrates its interests and begins to look out for itself first”) and http://hosted.ap.org/dynamic/stories/U/US_OBAMA_CAMPAIGN_ENTHUSIASM?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2011-03-15-06-33-15 (“Obama’s team seeks new ways to fire up his base”)
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Banks Have $2.5 Trillion Exposure To Ailing Quartet Of Portugal, Ireland, Greece And Spain
An article in the UK’s Telegraph states that the total exposure of foreign banks to Portugal, Ireland, Greece And Spain (the “PIGS”) tops $2.5 trillion once all forms of risk are included, according to the latest data from the Bank for International Settlements. Indeed, the UK Telegraph’s Ambrose Evans-Pritchard has written:
See http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8379302/Banks-have-1.6-trillion-exposure-to-ailing-quartet-of-Greece-Ireland-Portugal-and-Spain.html; see also http://en.wikipedia.org/wiki/PIGS_(economics) (“PIGS (economics)”)
If anything, the $2.5 trillion estimate will prove to be low, because the problems have been underestimated and will be much worse. The total exposure of foreign banks will be even more staggering, and other economies will teeter on the brink—if not go under. The ripple effects both in Europe and globally will be enormous.
See, e.g., http://online.wsj.com/article/SB10001424052748703778104576286441287643636.html?mod=WSJ_hp_LEFTWhatsNewsCollection (“Greece’s Budget Deficit Higher Than Expected”)
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The Web Is Free!
TIME magazine has a very useful short article at its blog about television by its TV critic James Poniewozik—entitled, “NY Times Ending Free Digital Lunch (Mostly). Will You Pay?”—which is worth reading.
See http://tunedin.blogs.time.com/2011/03/17/ny-times-ending-free-digital-lunch-mostly-will-you-pay/
The Internet as a news source has burgeoned because it has been free. This underlies the culture of the Web; and those who defy its basic tenet may rue the day that they did.
Obviously the world has been shocked by unfolding events in Japan, after its massive earthquake, tsunami, nuclear meltdown and the tragic human suffering. The latest, most up-to-date news is found on the Web, not on America’s TV screens any more. Even the once-vaulted CNN is “recycling” its news, which means that we must go to the Web to learn about the latest developments. Not only are print newspapers becoming “dinosaurs,” but TV news is too.
See, e.g., http://www.ft.com/intl/cms/s/0/3eef0bc4-6f73-11e1-9c57-00144feab49a.html#axzz1pOnzLHsb (“Bleak outlook for US newspapers”)
When Rupert Murdoch was in the process of taking over the Wall Street Journal, he supported the doctrine that online news should be free. However, shortly afterward, he effectively imposed a “no fly zone” over his UK flagship newspaper’s Web site, the Times of London. My guess is the number of people who read that publication online today has plummeted.
Perhaps even more importantly, the ill will that the practice of blocking Internet users from access to the site’s articles, unless they pay, may greatly outweigh the revenues gained from its subscriptions. Indeed, my guess is that lots of Web users will boycott the Times for many years to come, both online and in print format, as a matter of principle.
This is an age when news sources are abundant all over the world. No one “needs” the Times or the New York Times anymore. I have been online for approximately 20 years; and I began posting useful links at my law firm’s Web site many years ago. Today, the list is so long, and our “News Of The World” section contains so many links to “free” news, that it is impossible to access more than a few of them each day because of time constraints.
See http://www.naegele.com/links.html
Every person has sites that are his or her favorites, so my list will not be yours. The bottom line, however, is that none of us “needs” the Times or the New York Times, and both may suffer greatly from their policies. Their Internet traffic may decline dramatically—if this has not happened already in the case of the Times—and a “silent” boycott of such sites may ultimately prove fatal to once-proud publications, and they may become more and more irrelevant.
Newspapers are dinosaurs now anyway, or at the very least “endangered species,” and such practices may seal their fate forever. Indeed, if the Times of London were to become totally free online again, it might take a long time before it would attract readers; and it might never regain what it once had.
Poniewozik is correct: “[T]his could be a disincentive for blogs to link to the [New York] Times.” Lots of us will be very reluctant to link to any of that newspaper’s articles out of a concern that we may end up with “dead links,” which would aggravate the readers of our blogs.
Lastly, lots of Web users—probably a majority—will never pay for any type of subscriptions offered by either the New York Times or the Times of London as a matter of principle. Again, and perhaps most importantly, such practices fly against the “sacred” culture of the Web: it is free!
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Debtors’ Prisons
The Wall Street Journal’s article entitled, “Welcome to Debtors’ Prison, 2011 Edition,” is worth reading. It states in pertinent part:
See http://online.wsj.com/article/SB10001424052748704396504576204553811636610.html?mod=WSJ_hps_editorsPicks_1; see also http://www.cbsnews.com/8301-505143_162-57577994/as-economy-flails-debtors-prisons-thrive/ (“As economy flails, debtors’ prisons thrive“)
As the American and other global economies decline during the balance of this decade, such draconian measures may be used more and more to collect debts and harass debtors.
See, e.g., http://en.wikipedia.org/wiki/Debtors'_prison
In the United States, it is unconstitutional to incarcerate someone solely for failing to pay a debt. For example, it violates (1) the Due Process Clause of the Fourteenth Amendment, (2) the Cruel and Unusual Punishment Clause of the Eighth Amendment (as applied to the States through the Due Process Clause of the Fourteenth Amendment), and (3) the Eighth Amendment contains the Excessive Fines and Excessive Bail Clauses.
See http://topics.law.cornell.edu/constitution/amendmentxiv (Section 1: “No state shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any state deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws”) and http://topics.law.cornell.edu/constitution/billofrights#amendmentviii (Amendment VIII: “Excessive bail shall not be required, nor excessive fines imposed, nor cruel and unusual punishments inflicted”)
In Florida, for example, the St. Petersburg Times stated in an editorial entitled, “Debtors’ prison—again”:
See, e.g., http://www.tampabay.com/opinion/editorials/article991963.ece; see also https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/ (“Poverty In America”)
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Euro’s Collapse Is Not ‘Unthinkable’: Warren Buffett
In an article with this title, it is reported:
See http://www.cnbc.com/id/42248019; see also http://blogs.telegraph.co.uk/finance/ianmcowie/100010007/house-prices-are-falling-faster-in-britain-than-spain/ (“House prices are falling faster in Britain than Spain”)
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America’s Next Ticking Financial Time Bomb: The Pension Benefit Guaranty Corp?
In an article by Greg Stiles entitled, “Harry & David asks to drop $27.4 million pension plan,” which appeared in Southern Oregon’s Mail Tribune, it is reported:
See http://www.naegele.com/documents/HarryandDavidaskstodroppensionplan.pdf; see also http://www.mailtribune.com/apps/pbcs.dll/article?AID=/20110330/NEWS/103300340
Granted, as the article points out: “Defined benefit plans have declined throughout corporate America during the past decade, giving way to more speculative 401(k) plans.” However, as the U.S. economy sours during the balance of this decade, query whether American taxpayers will not on the hook for essentially unlimited financial payouts?
Won’t the PBGC’s cash flow be inadequate to meet such payouts, giving rise to underfunded payouts like those pertaining to Social Security and Medicare? How can it possibly be said that such payouts will occur at no cost to the taxpayers? What are the potential dimensions of this economic “iceberg”?
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Foreign Banks Borrowed At Least 70 Percent Of The $110.7 Billion Borrowed From The Fed’s Discount Window!
This disclosure of the Fed’s lending during a week in October 2008 should prompt congressional reexaminations of the risks to U.S. taxpayers stemming from the Fed’s role in stabilizing global financial markets during economic crises.
In an important article entitled, “Foreign Banks Tapped Fed’s Lifeline Most as Bernanke Kept Borrowers Secret,” Bloomberg has reported:
See http://www.bloomberg.com/news/2011-04-01/foreign-banks-tapped-fed-s-lifeline-most-as-bernanke-kept-borrowers-secret.html; see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1497 (“Foreign Banks Borrowed At Least 70 Percent Of The $110.7 Billion Borrowed From The Fed’s Discount Window!”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1131 (“Low Rates Fail To Rescue Indebted Britain, The Eurozone Is In Need Of An Undertaker, The Euro Has One-In-Five Chances Of Survival, Market Alarm As US Fails To Control Biggest Debt In History, And China’s Property Bubble Has Grown So Huge That 85 Percent of Chinese Living In Cities Cannot Afford A Home”)
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While Most Of America Is Hurting Economically, The Super-Rich Are Richer Than Ever
This is the conclusion of University of California, Berkeley professor Robert Reich who is quoted by the AP as follows:
See http://hosted.ap.org/dynamic/stories/U/US_RICHARD_BRANSON_VENTURE?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2011-04-05-03-26-18
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World’s Central Banks Pursue Divergent Strategies
In a fascinating and important article, the Wall Street Journal has discussed the divergent approaches being undertaken by the United States’ Board of Governors of the Federal Reserve System (or the “Fed”), by the European Central Bank (or “ECB”) and by central banks elsewhere in the world. Also, an interactive graphic is provided that depicts those actions.
See http://www.naegele.com/documents/CentralBanksGrappleWithCompetingForces.pdf (“Central Banks Grapple With Competing Forces”) and http://online.wsj.com/article/SB10001424052748703712504576245031446096202.html#articleTabs%3Dinteractive (“Interactive Graphics”)
As I have written previously:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html
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Suicide Rates Climb As The Economy Declines
Bloomberg is reporting:
See http://www.bloomberg.com/news/2011-04-14/suicide-rates-rise-in-u-s-as-economy-declines-cdc-study-finds.html
First, as indicated in the article and comments above, we are in the midst of the “Great Depression II”—not a mere recession—which will not end until late in this decade, at the earliest. Yes, there will be “green shoots,” or signs that things are improving, which will give false hopes. However, the same thing was true during the Great Depression of the last century, which did not end until the onset of World War II.
Second, the results of the study are not surprising; and these statistics—and the individual human tragedies that they represent—will become even more pronounced in the United States and globally during the rest of this decade.
Third, it is unfortunate that the study does not take into account data after 2007, but at least it is a start.
Fourth, as I have written:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html
The balance of this decade will be “ugly”—there is no other way to describe it. The political backlashes were evident already in last November’s American elections.
Lastly, there may be a newfound turning to God, on the part of many people globally, which will be healthy.
See, e.g., https://naegeleblog.wordpress.com/2010/05/12/what-and-where-is-god/
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Government Does Not Work, And Must Be Abolished Whenever And Wherever Possible
As if government incompetence could not get any worse, it has. In an article entitled, “Oops! US post service prints THREE BILLION stamps using the wrong Statue of Liberty,” the UK’s Daily Mail has reported:
See http://www.dailymail.co.uk/news/article-1377259/US-post-service-prints-3-BILLION-stamps-using-wrong-Statue-Liberty.html
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The Two-Speed Global Economy
The Wall Street Journal has a fascinating article about this subject, which is worth reading. It states in pertinent part:
See http://online.wsj.com/article/SB10001424052748703838004576274750183949910.html?mod=WSJ_hp_MIDDLENexttoWhatsNewsTop; see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1548 (“While Most Of America Is Hurting Economically, The Super-Rich Are Richer Than Ever”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1563 (“Suicide Rates Climb As The Economy Declines”)
Clearly, as my article above and the comments beneath it state, the worst is yet to come, both in the United States and globally. Politicians and economists will be overwhelmed during the balance of this decade, and their ranks will be decimated.
See also http://www.dailymail.co.uk/news/article-1379270/Economic-Chernobyl-Dems-accuse-GOP-kamikaze-budget-politics-14-300-000-000-debt-ceiling-debate-rages-on.html and http://rove.com/articles/311 and https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-1567
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The Times Ahead Do Not Look Pretty
This is the assessment of George C. Karlweis—”the former giant gnome of Geneva,” and “the brain behind Banque Privee, owned by the late Edmond de Rothschild”—which is set forth in an excellent article by UPI’s Editor at Large Arnaud de Borchgrave that is worth reading. It states in pertinent part:
See http://www.upi.com/Top_News/Analysis/de-Borchgrave/2011/04/26/Commentary-Big-Gnome-Cant-last/UPI-17111303816102/ (“Big Gnome: Financial situation can’t last”)
This article echoes what I have said for a long time now:
See http://www.americanbanker.com/issues/173_212/-365185-1.html; see also http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html (“America and other nations are in uncharted waters; and their politicians may face backlashes from disillusioned and angry constituents that are unprecedented in modern times”) and http://seekingalpha.com/instablog/2951-ilene-at-psw/31177-interview-with-timothy-d-naegele (“I believe [the repeal of Glass-Steagall] was a mistake, just like I believe the entire notion of “deregulation” was a mistake, which Greenspan championed. The chickens have come home to roost already, with much more to come”)
I added:
See https://naegeleblog.wordpress.com/2010/04/23/is-financial-reform-simply-washingtons-latest-boondoggle/ (emphasis in original; footnote omitted)
I believe former Fed Chairman Paul Volcker would not have created the problems that Greenspan did; and that he would prefer to see “a full reinstatement” of Glass-Steagall. However, this may be impossible today. Humpty Dumpty fell off the wall, and as the children’s nursery rhyme says: “All the king’s horses and all the king’s men [c]ouldn’t put Humpty together again.” The same may be true of Glass-Steagall. Moreover, I believe the “Great Depression II” will be with us for at least the balance of this decade.
See also http://en.wikipedia.org/wiki/Humpty_Dumpty#Lyrics
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Sun Setting On British Power [UPDATED]
This is the title of an important Wall Street Journal article, which is consistent with everything that I have written above. The UK’s prime minister, David Cameron, is in the process of tragically “gutting” his country’s military power and relegating it to the position of some Third World banana republic.
In particular, the article states:
See http://www.naegele.com/documents/SunSettingonBritishPower.pdf (emphasis added); see also http://www.telegraph.co.uk/news/worldnews/africaandindianocean/libya/8573849/Navy-chief-Britain-cannot-keep-up-its-role-in-Libya-air-war-due-to-cuts.html (“Navy chief: Britain cannot keep up its role in Libya air war due to cuts”) and http://www.telegraph.co.uk/news/uknews/defence/8584032/Defence-chiefs-warn-cuts-threaten-security.html (“Senior defence figures have warned that cuts to Britain’s military have endangered the nation’s security, its relationship with the United States and the future of Nato”) and http://www.telegraph.co.uk/news/worldnews/southamerica/falklandislands/9042422/Argentina-doesnt-have-military-power-to-seize-the-Falklands-says-defence-minister.html (“It is arguable Great Britain will no longer have an Army—we will have a defence force. That is an absolutely disgraceful situation when faced by the uncertainty we are. The RAF is cut in half, the Royal Navy is emasculated; we do not have the capability in this country to do the things we have always done”)
Like Barack Obama, Cameron should be removed from office. Indeed, Obama has been undermining America’s national security capabilities, as well as those of the UK.
See, e.g., https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-1606 (“Barack Obama’s Sacking Of The Pentagon”) and https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-1383 (“WikiLeaks cables: US agrees to tell Russia Britain’s nuclear secrets”); see also http://www.telegraph.co.uk/finance/economics/8672697/UK-households-squeezed-harder-than-US-or-Europe.html (“UK households squeezed harder than US or Europe”) and http://www.washingtonpost.com/opinions/charles-krauthammer-how-fractured-is-the-gop/2013/08/01/6fd6f816-fada-11e2-9bde-7ddaa186b751_story.html (“Today, alas, Britannia rules no waves. World order is maintained by American power and American will”)
If anything, the UK’s economy will get far worse during the balance of this decade, which will result in the further diminishment of the UK’s once-proud and mighty military prowess.
Contrariwise, Harvard economics professor and former chairman of the Council of Economic Advisers under President Reagan, Martin Feldstein, argued in an excellent article entitled, “Defense Spending Would Be Great Stimulus,” that all three American military service branches are in need of upgrade and repair.
See http://online.wsj.com/article/SB123008280526532053.html
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California Sinks . . . Farther . . . As U.S. Supreme Court Orders Release Of Approximately 46,000 Prison Inmates
The State of California—the eighth largest economy in the world—is bankrupt; its largest city, Los Angeles, is bankrupt too; vital public services are being curtailed if not eliminated entirely, including law enforcement; and now this . . . which may result in the dramatic increase of crime in the State.
In a sharply-worded dissent from the Court’s 5-4 decision, Justice Antonin Scalia called the ruling “staggering” and “absurd,” and warned that “terrible things are sure to happen.” This is an understatement.
See http://www.latimes.com/news/local/sc-dc-0524-court-prisons-web-20110523,0,2337401.story; see also http://online.wsj.com/article/SB10001424052702304066504576345553135009870.html?mod=WSJ_hp_LEFTTopStories (“[G]reater incarceration can explain about one-quarter or more of the crime decline”)
California is a microcosm of what is happening nationally and globally—and of what will happen even more during the balance of this decade.
See, e.g., http://www.bloomberg.com/news/2011-05-27/global-economic-rebound-weakens-on-quake-oil-price-european-debt-crisis.html (“Global Economic Rebound Weakens on Quake, Oil Price, European Debt Crisis”)
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Is The Arab Spring Being Hijacked By Ultra-Conservative Islamists, Similar To What Happened In Iran?
This was predictable, and now it seems to be happening. For example, Reuters has reported the words of one Cairo lawyer who is a Christian: “We did not risk our lives to bring Mubarak down in order to have him replaced by [ultra-conservative Salafist Islamists].” Reuters adds:
See http://ca.news.yahoo.com/christians-worry-egypt-being-hijacked-islamists-031322380.html
Will the “Scent of Jasmine” that began in Tunisia morph into a “stench” that engulfs the region? Only time will tell.
What is clear though is that following the rigged election of 2009 in Iran, countless Iranians who spoke out, protested and advocated freedom were beaten, jailed, tortured and killed, while Barack Obama—America’s “Hamlet on the Potomac,” or “Jimmy Carter-lite”—stood by helplessly and did nothing to come to their aid.
See, e.g., https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-1316 (see also the article itself, as well as the footnotes and other comments beneath the article)
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Let China Or Russia Defend The UK
The UK’s Economist has an article entitled, “Keeping government hands off their benefits,” which is barely worth reading. It begins by advocating “massive cuts in America’s defence budget,” which would leave the UK defenseless, because its Prime Minister David Cameron is decimating the UK’s defense capabilities already.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1591 (“Sun Setting On British Power”)
We in America do not need to protect the UK anymore; let China or Russia do it, although—come to think of it—Putin’s Russia is effectively a Third World country militarily, and a mere shadow of what the Soviet Union once was.
See, e.g., https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/ (“Russia’s Putin Is A Killer”) (see also the footnotes and comments beneath the article)
With respect to “NATO’s confused intervention in Libya,” which the Economist asserts, few Americans really care what happens in Libya, in large part because there is reason to believe that the Arab Spring will be hijacked by ultra-conservative Islamists, similar to what happened in Iran. The “Scent of Jasmine” that began in Tunisia may morph into a “stench” that engulfs the region; and the UK’s involvement in that campaign may prove to be a waste of financial and human resources.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1604
Also, there will be no cuts to Medicare and Social Security, which the Economist advocates. They are effectively the “third rail” of American politics—too hot to touch. Those who try will be rejected by the voters. If Obama had not wasted taxpayers’ monies on his so-called “Stimulus Package” and other programs, increasing our budget deficit dramatically, no one would be focused on cutting our defense budget, and Medicare and Social Security would be dealt with many years from now, if at all.
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We’re On The Verge Of A Great, Great Depression, And The Federal Reserve Knows It
These are the words of Peter Yastrow, market strategist for Yastrow Origer, which were reported by CNBC. Yastrow added:
See http://www.cnbc.com/id/43236764; see also http://www.dailymail.co.uk/news/article-1393237/US-economy-Were-verge-great-great-depression.html (“[T]he first quarter drop in house prices means they have fallen by more than during the Great Depression”)
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Gloom And Doom, As More Americans Think Economy Will Never Recover
This is the conclusion of CNBC, in an article that states:
See http://www.cnbc.com/id/43268037 (emphasis added)
What is becoming crystal clear is that the United States is not in a recession, but in the “Great Depression II,” which economic historians will describe as such—or by using similar terms—20-40 years from now. Yes, there will be “green shoots” from time to time, or signs that things are improving, but this was true during the Great Depression of the last century too, which did not end until the onset of World War II, at the earliest.
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Unfortunately, I am in agreement with you. Living in one of the states hardest hit by the severe economic situation does make me wonder if we will ever recover. The jobs are simply “not here”, so many have left my state, never to return, but I also wonder if they are finding employment elsewhere.
Speaking of cutting back, that is what I have done, knowing full well others have to. As an example, I used to eat out at least once a week, perhaps more when it was the week of my pay check. Now, once a month is a great treat!!! That being said, I am OK with spending less in restaurants,,,,,,,,,,,but also know that is not good for the restaurant industry.
I am not yet at the point of calling our current state of the nation to be in a Depression, but if I were to lose my job, I know I would be in a personal Depression. It is often said that attitude can make or break many accomplishments in life. Thank goodness I remain positive in this uncertain world. Living on less can be kind of fun.
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Homeowners Turn The Tables By Foreclosing On The Bank Of America
This is the title of an article in the UK’s Daily Mail about a south Florida couple who got sweet revenge when they foreclosed on the Bank of America, instead of the other way around. As the article stated:
See http://www.dailymail.co.uk/news/article-1394412/Nyergers-family-homeowners-turn-tables-foreclosing-ON-Bank-America.html
Sweet revenge, indeed. Hopefully this happens again and again, across the U.S. and in other countries; and banks and other lenders are taught a lesson.
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I saw this story yesterday, and had the same reaction–what a great example of true justice at work. Hopefully the story goes viral and becomes a source of inspiration to those that think they can’t fight back.
Of course, it appears that it does help to have the resources to do it.
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Nearly 40 Percent Who Borrowed Against Their Homes Are Underwater
In a very sobering article entitled, “Second-Mortgage Misery,” the Wall Street Journal notes:
See http://online.wsj.com/article/SB10001424052702304906004576369844062260756.html?mod=WSJ_hp_LEFTTopStories#articleTabs%3Darticle (emphasis added); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1563 (“Suicide Rates Climb As The Economy Declines”)
This is an excellent article, which only captures the tip of an enormous iceberg.
More and more Americans will lose their homes, and the human suffering will be unfathomable, and it will last at least through the end of this decade. Second mortgages are merely one facet of the human tragedy that is unfolding.
The “bottom” of the housing market will not be reached for about five more years; and it will be brutal between now and then. Those who sit on the sidelines patiently, with cash, will be rewarded. There will be bargains galore; and today’s prices will fall at least another 50 percent.
Hold on tight, it will be very ugly—in the United States, Europe (e.g., Ireland, the UK), Asia and on a global scale.
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Wow, if prices drop another 50%, the bank is probably going to want their home equity loan back, and I haven’t even tapped it yet. Sometimes I wonder why I don’t follow the crowd, spend away, and worry about it later.
My dad’s family survived the last depression on a farm in North Dakota. They were frugal and self-sufficient, and did quite well. On the other hand, both my wife and I lost our corporate jobs during the downturn that started in 2000. Myself in 2004, and she, this year. As they say, it’s only a recession if your neighbor loses his job. It becomes a depression when you lose your own job.
Luckily, we didn’t overextend ourselves, so we can go a year before dipping into retirement assets. And long after, due to being savers during our working years.
But the amazing thing is…the family farm may save the day again. Seems they are about to drill for oil on our farm as it was located atop one of the richest pools of oil in North Dakota. Never been a religious man, but I’ve been giving a lot of thanks to my long-gone ancestors lately. I think they knew that land would take care of the family forever.
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Thank you for your additional comments.
With respect to your first paragraph, it might be most prudent not to spend the money, as you know. Hold it in reserve for a “rainy day,” but act conservatively and avoid using it.
I agree with your second paragraph; however, during the balance of this decade, such job losses will sweep the United States and other countries, and the human suffering will be staggering.
With respect to your last paragraph, congratulations! I have a lawyer-friend who inherited two farms in South Dakota, but no oil yet. He has been benefiting from high crop prices though, and is very thankful.
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CNN Poll: Obama Approval Rating Drops As Fears Of Depression Rise
This is the title of an important CNN article, which is worth reading. It states in pertinent part:
See http://politicalticker.blogs.cnn.com/2011/06/08/cnn-poll-obama-approval-rating-drops-as-fears-of-depression-rise/; see also http://cnsnews.com/news/article/after-28-months-stimulus-spending-19-mil (“1.9 Million Fewer Americans Have Jobs Today Than When Obama Signed Stimulus”) and http://www.cnbc.com/id/43441924 (“Misery Index” Highest In 28 Years)
Since before this blog began in December of 2009, I have maintained that the United States and other countries worldwide are in the mist of the “Great Depression II.” If anything, the empirical data and other similar findings set forth at this blog support that conclusion. It has been stated again and again that 20-40 years from now, economic historians will describe the end of the last decade and the current decade as an economic depression, not a recession, drawing parallels between this period and the Great Depression of the last century that did not end until the outset of World War II—or perhaps at the end of it.
Also, I have maintained that “green shoots”—or signs that things are improving—may appear from time to time, similar to what happened during the Great Depression, and hopes may rise. However, in all likelihood, they will be short-lived and dashed as the green shoots turn into “dead weeds,” and the economic tsunami continues to roll worldwide, bringing enormous suffering to millions of people. With respect to the housing sector alone, I have predicted that the “bottom” will not be reached for at least another five years; and that those who sit on the sidelines and wait patiently, with cash, will find bargains galore and be rewarded handsomely.
See, e.g., http://www.americanbanker.com/issues/173_212/-365185-1.html (“Greenspan’s Fingerprints All Over Enduring Mess”) and http://seekingalpha.com/instablog/2951-ilene-at-psw/31177-interview-with-timothy-d-naegele (“Greenspan’s legacy: more suffering to come”—”Interview with Timothy D. Naegele”); see also https://naegeleblog.wordpress.com/2010/05/16/will-the-eus-collapse-push-the-world-deeper-into-the-great-depression-ii/ (“Will The EU’s Collapse Push The World Deeper Into The Great Depression II?”) and https://naegeleblog.wordpress.com/2010/04/23/is-financial-reform-simply-washingtons-latest-boondoggle/ (“Is Financial Reform Simply Washington’s Latest Boondoggle?”) and https://naegeleblog.wordpress.com/2009/12/16/the-great-depression-ii/ (“The Great Depression II?”)
More and more observers are agreeing with what has been stated at this blog; namely, the Great Depression II is here to stay, at least through the balance of this decade, and the human suffering is and will continue to be unfathomable. As I stated in an article entitled, “Euphoria or the Obama Depression?” that was published by the McClatchy Newspapers and McClatchy-Tribune News Service on April 8, 2009:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html
I have contended that “Barack Obama Is A Lame-Duck President Who Will Not Be Reelected,” and this conclusion is becoming more and more evident to millions of Americans and others worldwide.
See https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/ (see also the footnotes and comments beneath the article); see also https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-1617 (“Why Barack Obama May Be Heading For Electoral Disaster In 2012”) and http://www.bloomberg.com/news/2011-06-22/obama-gets-30-of-americans-certain-to-support-re-election-in-economy-poll.html (“Obama Gets 30% of Americans Certain to Support Re-Election in Economy Poll”) and http://online.wsj.com/article/SB10001424052702304657804576401653113017130.html?mod=WSJ_hp_mostpop_read (“President Barack Obama is likely to be defeated in 2012”)
. . .
In a CNBC article entitled, “US Is Nearing Even Worse Financial Crisis: Jim Rogers,” financial “guru” and international investor Jim Rogers’ sobering assessments are cited:
See http://www.cnbc.com/id/43328325; see also http://www.cnbc.com/id/43354054 (“JPMorgan Forecasts Another Drop in Home Prices”) and http://www.marketwatch.com/story/many-of-us-wont-be-able-to-retire-until-our-80s-2011-06-09 (“Many of us won’t be able to retire until our 80s”)
CNBC has reported:
See http://www.cnbc.com/id/43395857 (“US Housing Crisis Is Now Worse Than Great Depression”)
In another important Wall Street Journal article entitled, “The Great Property Bubble of China May Be Popping,” it has been reported:
see http://www.naegele.com/documents/TheGreatPropertyBubbleofChinaMayBePopping.pdf; see also https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/ (“China Is America’s Enemy: Make No Mistake About That”) and http://www.dailymail.co.uk/news/article-2005231/Chinas-ghost-towns-New-satellite-pictures-massive-skyscraper-cities-STILL-completely-empty.html (“China’s ghost towns: New satellite pictures show massive skyscraper cities which are STILL completely empty”) and http://www.telegraph.co.uk/finance/china-business/8598998/Enter-the-dragon-to-save-the-euro.html (“Enter the dragon ‘to save the euro’”)
The economic tsunami that was unleashed several years ago continues to roll worldwide, producing tragic human suffering that will increase exponentially during the balance of this decade.
Hold on tight. The worst is yet to come. Things will get very ugly between now and the end of this decade, both in the United States and globally!
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It’s not a very popular message, but indeed, all sign are red…
There is an insufficient consumer trust, due to anger for the economic future, feed by unemployment,by fall of housing prices and stocks. The public sector is absorbing more and more debts to try to boost the economy. Despite this, there a lack of real economic growth. The so called “growth figures” are bought by programs as QE2. At the end of this cyclus, hyperinflation will occur, without growth, this will lead to severe stagflation and a second worldwide depression.
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Thank you, Oliver, for your comments.
Yes, many people agree with you. My guess is that some stagflation will occur, but deflation will prevail. Indeed, massive deflation of housing prices and values is occurring already, with much worse yet to come.
Because the net worths of so many Americans and other nationalities depend on their equity in housing, this alone will contribute greatly to the depression.
Government tax revenues will fall, consumer spending will fall dramatically, and the downward pressures will be enormous.
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America Is Losing Its Grip
This is the grim warning of outgoing Secretary of Defense Robert Gates. His admonitions continue:
See http://www.newsweek.com/2011/06/19/the-defense-rests.html?om_rid=NsfkQq&om_mid=_BN-f69B8bzy3X1
America’s “prince of darkness”—or its “Hamlet on the Potomac” and “Jimmy Carter-lite”—Barack Obama is doing everything in his power to destroy our military might, after having added dramatically to our nation’s budget deficit that is sapping our economic vitality and strength. He would have the United States become a UK militarily, or worse, which is why he is sending Leon Panetta to the Pentagon, to “gut” it.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1591 (“Sun Setting On British Power”)
Ronald Reagan encountered Obama’s negativism when he came to the White House in the wake of Carter’s presidency; and he turned our ship of state around, and changed the course of history. Our enemy, the once-mighty Soviet Union, collapsed and is gone today; and America has reigned supreme ever since, as the world’s only superpower.
Accordingly, Obama must be sent packing either to Chicago or Hawaii no later than January of 2013, to write his memoirs and work full time on his presidential library. He a tragic Shakespearean figure who will be forgotten and consigned to the dustheap of history, like Lyndon Johnson and Jimmy Carter before him—unless he tragically alters the course of American history.
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Debt Crisis May “Overwhelm” Euro Zone
This is the title of a Wall Street Journal article, which is consistent with what I have written above, albeit far too optimistic. It states in pertinent part:
See http://online.wsj.com/article/SB10001424052702303936704576397470527710588.html?mod=WSJ_hp_LEFTWhatsNewsCollection; see also http://www.telegraph.co.uk/news/worldnews/europe/eu/8585704/Boris-Johnson-let-Greece-go-bankrupt-and-leave-the-euro.html (“Boris Johnson: let Greece go bankrupt and leave the euro”)
As the banks’ balance sheets are battered even more (e.g., by reason of further declines in housing prices, and ensuing defaults), it will be difficult if not impossible to shore up their capital positions.
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Confidence In Housing Values Plummets
This is the conclusion reached by the Rasmussen polling organization, which is summarized as follows:
See http://www.rasmussenreports.com/public_content/business/housing/june_2011/confidence_in_housing_values_plummets; see also http://finance.yahoo.com/news/Home-sales-fell-to-2011-low-apf-682403843.html (“Home sales fall to 2011 low; few 1st-time buyers”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1638 (“CNN Poll: Obama Approval Rating Drops As Fears Of Depression Rise”)
Homeowners are just catching up with what is happening to home prices in the marketplace, which will decline at least another 50 percent in the next five years or so. Homeowners will be wiped out, and lose their homes on an ever-increasing basis. In the interim, effectively they will be nothing more than renters, with the banks and other lenders actually owning their homes.
Homebuilders and realtors are fraudulently pushing homeownership, when in fact the opposite is true. More homebuilders and realtors will lose their jobs; and their respective industries will be decimated. Those Americans and others globally who sit patiently on the sidelines with cash will be handsomely rewarded when the “bottom” is reached finally and there are bargains galore for those who are able to “bottom feed.” Cash will be king!
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In Fleeing Afghanistan, The West Relinquishes Its Grip On The World
This is the title of an interesting and sobering article by Peter Oborne—who is the UK Daily Telegraph’s chief political commentator—which is worth reading.
See http://blogs.telegraph.co.uk/news/peteroborne/100093677/in-fleeing-afghanistan-the-west-relinquishes-its-grip-on-the-world/
Oborne is mistaken: Richard Nixon did not lose the Vietnam War; Lyndon Johnson and the U.S. Congress did. As someone whom I know has written—who is a syndicated columnist and an outstanding reporter with impeccable, world-class credentials, based in Washington, D.C.:
See https://naegeleblog.wordpress.com/2010/10/04/john-f-kennedy-the-most-despicable-president-in-american-history, fn. 10.
Among other things, Oborne wrote:
What Oborne should have said, and did so implicitly, is that Barack Obama is responsible for what has been happening in Afghanistan, Iraq and elsewhere in the region; and he will be blamed for it—by the American people and by history.
Despite the wishful thinking of many, America is not in decline—any more than it was when Henry Kissinger and Jimmy Carter articulated similar beliefs.
One thing is crystal clear though: Obama must be forced from the U.S. presidency at the earliest possible date, and no later than January of 2013. He is an unmitigated disaster—a narcissistic demagogue, and America’s “Hamlet on the Potomac” and “Jimmy Carter-lite”—and his departure cannot happen fast enough!
See, e.g., https://naegeleblog.wordpress.com/2010/09/09/are-afghanistan-iraq-and-pakistan-hopeless-and-is-the-spread-of-radical-islam-inevitable-and-is-barack-obama-finished-as-americas-president/ (“Are Afghanistan, Iraq And Pakistan Hopeless, And Is The Spread Of Radical Islam Inevitable, And Is Barack Obama Finished As America’s President?”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/ (“The Economic Tsunami Continues Its Relentless And Unforgiving Advance Globally”) and https://naegeleblog.wordpress.com/2010/02/26/america-a-rich-tapestry-of-life/ (“America: A Rich Tapestry Of Life”) and https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-1637 (“CNN Poll: Obama Approval Rating Drops As Fears Of Depression Rise”) (see also the footnotes and comments beneath these articles)
. . .
The people who will suffer the most in Afghanistan when we pull out will be its women. Indeed, Obama will be giving Afghan women and young girls the “gift” of horrific Taliban rule once again, which will be inhumane.
American women, and women and women’s rights organizations worldwide, must rise up and tell Obama that a pull-out is acceptable only if he is willing to send his two girls to school in Afghanistan now and after the pullout—instead of their fancy school in the Washington, D.C. area—and he actually does this.
Tragically, we know what the Taliban will do—including the brutal killing, raping and disfiguring of Afghan women—for example, by cutting off their noses and ears. We need only ask “Aisha” (or the brave “Bibi”), and look into her eyes and at her once-beautiful features that were disfigured.
There are no mysteries about what Obama’s Afghan policies will produce—which is merely one of a multitude of reasons why his presidency must end as soon as humanly possible.
See https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-1102 (“Why We Fight In Afghanistan, And Why American Women Should Demand Barack Obama’s Removal From Office By Impeachment Or Otherwise”) (see also the article itself, as well as the footnotes and other comments beneath it)
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Obama’s Drawdown Disaster
In another brilliant commentary by Arnaud de Borchgrave, editor at large of The Washington Times and of United Press International—entitled, “Vietnam redux”—he has written:
See http://www.upi.com/Top_News/Analysis/de-Borchgrave/2011/06/29/Commentary-Vietnam-redux/UPI-65811309355176/; see also http://online.wsj.com/article/SB10001424052702303763404576416191709848746.html?mod=WSJ_hp_LEFTTopStories (“Al Qaeda Remains Top Threat to U.S.”) and http://www.usatoday.com/news/world/afghanistan/2011-07-04-petraeus-troop-drawdown_n.htm (“Obama’s plan was not among the range of options the military provided to him”)
He adds:
A truly brilliant article, as only de Borchgrave could have written, because of his vast experience with the Vietnam War and the lessons learned from it, as well as Afghanistan, Pakistan, Iraq and the Middle East in general, and the lessons to be learned from that region as well, and the tragedies that may be emerging.
Reason enough to make sure that Obama’s presidency ends no later than January of 2013, when he retreats either to Chicago or Hawaii to lick his political wounds and write his memoirs, and work full time on his presidency library!
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The Future Still Belongs To America
This is the title of an important Wall Street Journal article by Professor Walter Russell Mead—subtitled, “This century will throw challenges at everyone[, but the] U.S. is better positioned to adapt than China, Europe or the Arab world”—which states in pertinent part the following:
See http://www.naegele.com/documents/TheFutureStillBelongstoAmerica.pdf (bold emphasis added); see also https://naegeleblog.wordpress.com/2010/02/26/america-a-rich-tapestry-of-life (“America: A Rich Tapestry Of Life”)
The only thing on the horizon that might dampen the American future that Professor Mead has described is a nation-ending EMP Attack, which might kill all except for 30 million Americans, and end any future that we might envision.
Query whether we are totally and absolutely protected against such an attack, or whether America’s “prince of darkness”—and its consummate narcissistic demagogue, “Hamlet on the Potomac” and “Jimmy Carter-lite”—Barack Obama, is weakening our great nation’s military strength in ways that will dramatically change the course of history?
See https://naegeleblog.wordpress.com/2010/01/19/emp-attack-only-30-million-americans-survive/; see also https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/
. . .
In another important article entitled, “World power swings back to America”—and subtitled, “The American phoenix is slowly rising again. Within five years or so, the US will be well on its way to self-sufficiency in fuel and energy. Manufacturing will have closed the labour gap with China in a clutch of key industries. The current account might even be in surplus”—the UK Telegraph‘s Ambrose Evans-Pritchard added:
See http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/8844646/World-power-swings-back-to-America.html (emphasis added); see also http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/10209822/US-shale-threatens-Saudi-funding-crisis-and-demise-of-OPEC.html (“US shale threatens Saudi funding crisis and demise of OPEC”)
It is noteworthy that Evans-Pritchard qualifies his predictions by saying that they will occur in “five years or so.” I concur that America has a very bright future ahead; however, this decade will be “dicey,” and it is difficult if not impossible to predict when there will be light at the end of the tunnel—or when the economic tsunami will have run its course and petered out. What we do know is that the Great Depression of the last century did not end until the onset of World War II, at the earliest; and this depression may last just as long.
Lastly, Russia will continue to be a pygmy when compared to the United States—in terms of America’s vibrant democracy, its growth, military power and economic strength, and all other indicia of global power. The same will be true, to a similar degree, with respect to China, although its future is much brighter than that of Russia.
See, e.g., http://www.dailymail.co.uk/news/article-2063117/U-S-Army-tests-hypersonic-weapon-travels-times-speed-sound–ANYWHERE-earth-30mins.html (“U.S. Army tests hypersonic weapon that travels five times the speed of sound… and can hit ANY target on earth in 30mins”)
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German Bail-Out Fatigue Turns To Fury, And The Greeks Are Being Sacrificed
In an important article by the UK Telegraph’s Ambrose Evans-Pritchard entitled, “Germany’s judges hold the euro’s fate in their hands”—and subtitled, “Whether or not Europe’s monetary union survives in its current form, shrinks to a Carolingian core, or shatters, depends as much on abstruse legal arguments put forward . . . in Germany’s constitutional court as it does on the parallel drama unfolding on Greek streets”—it is reported:
Evans-Pritchard added:
By way of background, Evans-Pritchard stated:
See http://www.telegraph.co.uk/finance/financialcrisis/8619241/Germanys-judges-hold-the-euros-fate-in-their-hands.html; see also http://www.guardian.co.uk/commentisfree/2011/jul/05/marshall-plan-europe-hesitant-leaders (“Any new Marshall plan will founder in the minds of Europe’s hesitant leaders”)
What is increasingly clear is that there will not be another Marshall Plan because the political consensus is not there. Also, the only truly strong country in Europe is Germany, which is in the process of turning inward as the political will to bail out Europe runs headlong into German nationalism. This is likely to increase, as the eurozone fractures.
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The Next, Worse Financial Crisis: Ten Reasons Why We Are Doomed To Repeat 2008
This fine Wall Street Journal article by Brett Arends can only be supplemented, not disparaged. It is not “Pollyannaish,” glossing over the warning signs on the horizon, like so many commentators who “sugar-coat” what is happening.
See http://www.marketwatch.com/story/the-next-worse-financial-crisis-2011-07-06
As far-fetched as it might seem at first blush, we have only seen the tip of an enormous iceberg, with much worse yet to come during the balance of this decade. Economic historians will be pouring over what has happened already, as well as what is to come, for many decades ahead, trying to determine what really happened.
As I wrote two and a half years ago in the American Banker, the daily newspaper of the banking industry:
See http://www.americanbanker.com/issues/173_212/-365185-1.html
Arends is correct: “No one has been punished”—not Greenspan, or anyone else. A federal official with reason to know told me that between 15-20 percent of the indictees in federal courts are probably innocent. Some are seniors who have been charged with cheating the Social Security program, and they are scared to death, so they agree to plea bargains rather than fight for their innocence. Yet, those who caused the suffering of millions of people globally have not been brought to justice, with much greater suffering to come.
See https://naegeleblog.wordpress.com/2011/01/03/the-american-legal-system-is-broken-can-it-be-fixed, n.8.
Echoing Arends’ conclusion that “those in the know” lose little—or nothing—if things go wrong, one should take time to read Bernie Madoff’s interview in New York Magazine, which concludes that the market is a whole rigged job, and there’s no chance that investors have in this market.
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1464; see also http://seekingalpha.com/instablog/2951-ilene-at-psw/31177-interview-with-timothy-d-naegele (“Greenspan’s legacy: more suffering to come”)
Arends is correct that the “referees” are corrupt too. I have been a lobbyist, and know how it works in spades.
See, e.g., https://naegeleblog.wordpress.com/2010/09/24/washington-is-sick-and-the-american-people-know-it (“Washington Is Sick And The American People Know It”) (see also the footnotes and comments beneath the article)
Most commentators point to “green shoots,” or signs that things might be improving, but there were green shoots during the Great Depression of the last century, which did not end until the onset of World War II, at the earliest. Twenty-to-forty years from now, economic historians will describe what we are going through now as the “Great Depression II,” or by using similar terms.
Hold on tight. Housing prices will fall by at least another 50 percent in the next five years or so; more loans will be “underwater, and homeowners will default and lose their homes; and banks and other lenders will be in even deeper troubled waters as their “toxic” loans increase, and their capital diminishes or evaporates.
As I wrote more than two years ago:
Last November’s elections saw Barack Obama and his Democrats suffer significant electoral losses, but they may pale in comparison with what happens next year.
See, e.g., https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-1637 (“CNN Poll: Obama Approval Rating Drops As Fears Of Depression Rise”) (see also the article itself, as well as the footnotes and other comments beneath it); see also http://www.realclearpolitics.com/articles/2011/07/08/an_establishment_in_panic_110501.html (“An Establishment in Panic”)
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Treasury Secretary Geithner Echoes What This Blog Has Been Predicting!
In an article entitled, “Geithner says hard times to continue for many,” the AP has reported:
See http://news.yahoo.com/geithner-says-hard-times-continue-many-150523958.html
If anyone seriously believes that “Obama rescued the United States from a second Great Depression,” there is a bridge in Brooklyn that they might wish to buy. Despite the “spin” that Obama, Geithner and others are giving to economic issues, most Americans understand fully what is happening and who is to blame, which is why Obama will not be reelected next year.
See, e.g., https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-1637 (“CNN Poll: Obama Approval Rating Drops As Fears Of Depression Rise”) (see also the article itself, as well as the footnotes and other comments beneath the article)
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More Government Shutdowns Are Coming
The UK’s Economist has an article about the government shutdowns in the State of Minnesota and elsewhere, which is worth reading.
See http://www.economist.com/node/18928883
What is crystal clear is that things will get worse, a whole lot worse, between now and the end of this decade. Indeed, many years from now, economic historians may refer to these times as the “lost decade” or the “Great Depression II,” or by using similar terms.
The closure of federal, State and local government facilities in the United States will become the norm. Included will be parks, more and more of which are closing now; museums and libraries; hospitals and other health care facilities; and schools and other educational facilities.
Courts will be closed, or operate on reduced schedules; and the list of “lights out” governmental entities will grow. Law enforcement will be terminated or “furloughed,” prisoners will be released, and crime will rise. Roads will go unpaved; and there will be a general breakdown and deterioration of America’s infrastructure.
See, e.g., http://www.usatoday.com/news/washington/story/2011-10-23/jobs-lost-economic-woes-hit-police-budgets/50885474/1?loc=interstitialskip (“Economic woes take toll on U.S. police departments”)
Government at all levels will be affected and have no choice, as tax revenues decline dramatically. Housing prices will fall by at least another 50 percent during the next five years or so, which means that property tax revenues will fall accordingly—unless government taxing entities refuse to reduce property valuations in a last-ditch attempt to maintain declining revenues. There will be “pitched battles,” in the courts and elsewhere, between the taxing authorities and the taxed; and more and more owners will have their properties seized to satisfy unpaid obligations.
Banks and other mortgage lenders are burdened today with staggering amounts of “toxic” and “underwater” loans, which are either on the lenders’ books already or the borrowers are poised to default in the days and months ahead and lose their properties. If the banks’ loan portfolios were “marked to market,” their net worths or capital might be negative now or fall precipitously. This will only get worse; and the bank regulatory agencies will be faced with the dilemma of whether to seize the “walking wounded” or allow them to operate and continue in existence, with their problems mounting each and every day.
In the United States and globally, meaningful and effective government solutions will be non-existent, and public outrage will be enormous and increasing exponentially. As I wrote more than two years ago:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html (“Euphoria or the Obama Depression?”)
Last November, Barack Obama and his Democrats suffered staggering electoral defeats in the United States. Next November, the consequences are likely to be even worse. Among other things, Obama might not be reelected; and if so, American economic issues may have proved to be decisive. Similar trends will be occurring in other countries.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1709 and https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-1637 (“CNN Poll: Obama Approval Rating Drops As Fears Of Depression Rise”) (see also the articles themselves, as well as the footnotes and other comments beneath them) and http://www.dailymail.co.uk/news/article-2021173/Americas-city-broken-dreams-50-jobless-destitute-people-set-forest-community-New-Yorks-doorstep.html#comments (“The Tent City of New Jersey: Desperate victims of the economic slump forced to live in makeshift homes in forest”)
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Will The Euro Crisis Will Give Germany The Empire It Has Always Dreamed Of?
This issue is discussed in an excellent and very sobering article by Peter Oborne, the UK Telegraph’s chief political commentator, which states in pertinent part as follows:
See http://blogs.telegraph.co.uk/news/peteroborne/100098260/this-crisis-will-give-germany-the-empire-its-always-dreamed-of/ (emphasis added); see also http://www.ft.com/intl/cms/s/0/c087c30e-b3be-11e0-855b-00144feabdc0.html#axzz1Smxa2CKN (“Athens’ ability to stay course in doubt”) and http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/8653579/Europe-steps-up-to-the-plate.html (“Europe’s economic recovery is sputtering out”) and http://www.telegraph.co.uk/finance/financialcrisis/8656572/Eurozone-debt-crisis-Europes-politicians-will-be-punished-for-a-deal-dripping-with-moral-hazard.html (“At some point the Germans will realise that the package is a thinly-veiled fiscal union which makes the transfers they funnelled into East Germany look like small change, and they will revolt at the ballot boxes”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1702 (“German Bail-Out Fatigue Turns To Fury, And The Greeks Are Being Sacrificed”) and http://www.telegraph.co.uk/finance/financialcrisis/8728628/Euro-bail-out-in-doubt-as-hysteria-sweeps-Germany.html (“Euro bail-out in doubt as ‘hysteria’ sweeps Germany”—”The next month will decide [German Chancellor Angela Merkel’s] future, Germany’s destiny, and the fate of monetary union”)
. . .
There are those who preach the tenets of creating a global government; and they maintain that the constitution of a new world order is essential to maintain democracy. Also, they contend that the regulation of the economy by a global financial institution can be a solution to the financial crisis that began in 2007, and such an institution would be a first step towards the creation of a global government, of which the European Union is an illustration.
Barack Obama agrees with this; and it is among the many reasons why he must not be reelected next year. Indeed, he will “retreat” either to Chicago or Hawaii no later than January of 2013, to lick his political wounds and write his memoirs, and work full time on his golf scores and his presidential library.
“Global governance” is pure and utter nonsense. Indeed, lots of Americans would gladly get rid of the UN, and ship it to France or elsewhere in Europe, and let the French or other Europeans pay for it. Global governance is “Mary Poppins-esque” and/or “Alice in Wonderland-esque.”
Americans do not want Germany or France participating in the governance of anything relating to the United States, any more than Hitler’s Germany should have done it. This is among the reasons why World War II was fought by the United States. America’s history abhors “meddling” in our affairs, which is exactly what global governance entails, and much much more. A majority of Americans might be willing to give up their lives fighting to insure that this never happens.
France did not win World War II. Americans saved Frenchmen from “enslavement” by the Germans. But for the United States, the French might be speaking German today as their “native” tongue. Indeed, a German-American—Dwight David Eisenhower—destroyed Hitler and his monstrous “Thousand-Year Reich.” France did not do it. France was flat on its pathetic back.
The United States has real enemies in this world today, who want to destroy us (e.g., China’s military, Putin and his Stalinist thugs in Russia, North Korea, Islamic fascists). We cannot rely on France or Europe to defend us—militarily, economically or in any other way. Indeed, France and Germany are perhaps the last countries in the world to preach to the United States about democracy. Americans have given their lives for it. France has only “talked” about it.
Lastly, Americans are not about to trust their survival, the survival and national security of our great country, and our freedoms and democracy to France or Germany, two countries that lost World War II.
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I agree with your last paragraph in its entirety, how I wish the people of the UK would adopt this principle, we are governed by at best sexual deviants of the middle of the road sort, now that in itself is not so bad however it does lead to weakness in making decisions, there is nothing clearcut about liberalism, liberalism or any sort of leftward leaning will not help us in the events about to overtake us.
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China’s Spectacular Real Estate Bubble Is About To Go Pop
In an article whose title is set forth above, Jeremy Warner—assistant editor of the UK’s Telegraph and one of Britain’s leading business and economics commentators—has written:
See http://blogs.telegraph.co.uk/finance/jeremywarner/100011023/chinas-spectacular-real-estate-bubble-is-about-to-go-pop (emphasis added); see also https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/#comment-1639 (“The Great Property Bubble of China May Be Popping“) and http://www.telegraph.co.uk/finance/china-business/8900271/China-property-raises-concerns-as-prices-continue-to-slide.html (“China property raises concerns as prices continue to slide”)
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I have been saying for the last few years that the dramatic rise in China’s property cannot sustain. This is from ground level observation. A 50 sq. m. apartment in a 1970-era building within the second ring of Beijing is going for roughtly $100000 (RMB 700000). That same property was sold for about RMB 15000 ~ 20000 in the early 1990s. With $100000 you can buy a bigger apartment in downtown Miami and it will be higher quality. People in the U. S. make much more money per capita, whereas the salary of a normal worker is anywhere from 1200 to 3000 Yuan per month. The wage / property ratio is out of control, like in Southern California during the housing bubble, to a different degree. Unfortunately, the psychology behind property bubbles is very similar everywhere in the world.
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Stocks, Real Estate Will Collapse And Keep Falling Into 2013
This prediction by James Fitzgibbon, director of the Highlander Fund, is totally consistent with—albeit more timid and conservative than—what I said in the article above (and in my footnotes and comments beneath it) and in other articles, and in an interview that I gave in October of 2009.
See http://www.dickmorris.com/blog/the-real-economic-story/#more-3883; see also http://www.americanbanker.com/issues/173_212/-365185-1.html (“Greenspan’s Fingerprints All Over Enduring Mess”) and http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html (“Euphoria or the Obama Depression?”) and http://seekingalpha.com/instablog/2951-ilene-at-psw/31177-interview-with-timothy-d-naegele (Interview with Timothy D. Naegele: “Greenspan’s legacy: more suffering to come”) and http://www.msnbc.msn.com/id/44370462/ns/business/ (“First time since 1945 that government has reported net monthly job change of zero”)
In an article by political pundit and former Bill Clinton adviser, Dick Morris, he added:
Hold on tight. The worst is yet to come, by far, during the balance of this decade. As I have written, we are in the midst of the “Great Depression II,” which economic historians will describe as such—or by using similar terms—20-40 years from now.
Yes, there will be “green shoots” from time to time, or signs that things are improving. This was true during the Great Depression of the last century as well, which did not end until the onset of World War II at the earliest.
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I am wondering, is there anyone out there who isn’t on needles and pins as this economic crisis continues to unfold???? You and the articles presented here bring up many poignant economic reasons of why we are in this situation today.
I believe most people don’t understand the theories and rules of economics, nor do they wish to. What they do understand though is really quite simple and certainly applies to the US or any other country. That is when anyone spends more than he has, or takes in, debt mounts; and due to everyday events, this makes it terribly hard to “catch up” and pay back the amount owed, with that awful interest hovering above and causing much, much, much higher debt. It is daunting and each person reaches a point where they cannot go on if there is no feasible way to meet the debt and also live. So then Bankruptcy occurs. Applying this to a country or countries is the only way I understand what a terrible fix we are in.
As far as I know there remains approximately 3 trillion dollars that Americans are hanging on to. They see no reason to invest in business because of the uncertainty due to unknown taxes, unknown medical costs and regulations the government can and will tag on them as they “do business.” Now who in the world would want to stick his neck out, open a business and employ others when so much uncertainty looms? Guess it is better to hold on to the money and not just give it away to the government. Small businesses have made this country prosper. Unfortunately the opportunity for Capitalism is not presently available in the US.
I feel we never got out of the recession of 2008,,,,,,,,,,,,,,,and are now headed to the big D. Your predictions may very soon be on our doorsteps. I’m just waiting to hear city after city declare hardship cases. Michigan alone lost 75 million dollars today that was federally generated to the colleges for food stamps for students……………..Can you believe that much money was appropriated to students??? Whatever happened to having a job while working one’s way through school?
Just my thoughts on this awful, sickening economic disaster we are in. I won’t even comment on the President!!!!!!!!!!!!!!!!!!!!! My nerves are already out of control.
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Thank you, Mary, for your thoughtful comments.
Yes, we are headed for far worse during the balance of this decade, dissimilar to anything we have witnessed in our lifetimes. Not a pretty picture, domestically or globally; and it is very unlikely that Barack Obama will be reelected.
See, e.g., https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/ (see also the footnotes and comments beneath the article)
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why should we be on “needles and pins” – I mean none of us mortals can control the mess so why should we get excited so much? The mess is on system level and thus affecting all. The unfairness of it is that it will provide brilliant opportunity to get rich or richer for some small minority and pain and suffering for everybody else. OC we may be mistaken but signs are all there for everybody to see. There have been for some time….
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Thank you for your comments. There is wisdom in what you say.
Yes, of course, there is no way that any of us can control or influence the global economic “mess.” Indeed, the politicians in the United States, Germany and elsewhere—many of whom are raving narcissists and demagogues—are apt to make things worse, a whole lot worse.
For example, Barack Obama pushed the enactment of his so-called “Stimulus Package,” which was fashioned not in the White House as such keystone legislative packages usually are, but by former House Speaker Nancy Pelosi and her Democratic colleagues to please their constituencies. The Republicans were effectively precluded from participating in the legislative process.
The net result is that the legislative package failed to stimulate the U.S. economy at all, and instead rewarded the Democrats’ faithful and added mightily to the American debt, which is causing so many problems today. As I have written:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html
We are seeing that now; however, the rising anger in America, the UK and elsewhere is only the tip of an enormous iceberg, which will rear its ugly head between now and the end of this decade, with a vengeance.
You are correct when you add:
I have noted this before.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1548 (“While Most Of America Is Hurting Economically, The Super-Rich Are Richer Than Ever”)
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Serving On A Board Of Directors Can Be A Thankless And Brutal Experience
USA Today has reported about the political infighting and rifts within the board of directors at the acclaimed Betty Ford Center for the treatment of drug and alcohol addiction in Rancho Mirage, California.
The former First Lady’s daughter was ousted from her leadership position with the board, and resigned entirely; financial support has stopped from some of the Center’s long-time contributors; the former First Lady’s wishes for the Center’s future are being disputed; and chaos seems to be engulfing the organization as its competitors broaden their reach geographically, and as the national economy falters. None of this bodes well for the Center’s future.
See http://www.usatoday.com/news/nation/2011-08-14-betty-ford-treatment-center-funding_n.htm and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/ (see also the footnotes and comments beneath the article)
Having served on several boards of directors, I vowed that I would never serve on another one. The “cat-fighting” and internal politics often make the most Machiavellian politics of Washington, D.C. seem like child’s play.
Egos and factions and power grabs seem to be the norm. Indeed, often the boards members are more interested in their power and positions, and the perks of being board members, than they are in advancing the worthy goals of the organization.
Many of us have found that it is a thankless job. More importantly, for those who serve on the boards of financial institutions and other large organizations, legal liability can attach to their decisions; and this alone can be brutal unless there are Directors and Officers Liability Insurance (“D&O”) policies in place that provide adequate coverage against costly litigation.
If asked today by a client about serving on a board, my gut reaction would be “no, don’t do it,” which is sad.
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Why Aren’t Homes Selling?
The answer is at least six-fold:
These are also among the many reasons why Barack Obama will not be reelected. The chickens are coming home to roost; and lots more Americans will lose their homes and suffer greatly, which will be true of those abroad as well.
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/ (“The Economic Tsunami Continues Its Relentless And Unforgiving Advance Globally”) and https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/ (“Barack Obama Is A Lame-Duck President Who Will Not Be Reelected”) (see also the footnotes and comments beneath both articles)
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A Series Of Anni Horribiles, Or Disastrous Years, Will Stretch Well Into This Decade
In another brilliant commentary by Arnaud de Borchgrave, editor at large of The Washington Times and of United Press International—entitled, “New world disorder”—he has written:
See http://www.upi.com/Top_News/Analysis/de-Borchgrave/2011/08/22/Commentary-New-world-disorder/UPI-22821314015006/
I respectfully disagree with de Borchgrave that the “global receding tide” will crest by 2013. This is wishful thinking.
The Middle East will get worse, and the promises of the “Arab Spring” and the “Scent of Jasmine” will seem long forgotten. Indeed, we may wish that we had the relative stability of the past again; and even Israel may be “engulfed.”
As for a world of predator “beasts” replacing the military as we know it, perhaps the “Brave New World” is coming—and I love the notion of robotic drones, submarines and the like—however, something tells me that “ground forces” and navies (with manned ships) and piloted planes will not become obsolete.
Education is shifting to the Web, and “bricks and mortar” colleges and graduate schools may be obsolete too, sometime in the future.
See https://naegeleblog.wordpress.com/2011/07/29/are-colleges-dinosaurs/
Lastly, Obama does not have a clue, and is history. The handwriting is on the wall.
See, e.g., https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/ (“Barack Obama Is A Lame-Duck President Who Will Not Be Reelected”) (see also the footnotes and all of the comments beneath the article)
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European Banks Face Collapse Under Debts, Warns Deutsche Bank Chief
This is the title of an article in the UK’s Telegraph, which comments on the warnings of Josef Ackermann, the chief executive of Deutsche Bank, Germany’s biggest bank. He has warned that “numerous” European lenders would collapse if they were forced to book their losses on stricken sovereign bonds:
See http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8742919/European-banks-face-collapse-under-debts-warns-Deutsche-Bank-chief-Josef-Ackermann.html
Of course EU banks face the prospect of collapse, and the same thing is true of American and other banks around the world. There is no mystery about this. Only someone who has no knowledge of economics fails to understand that this is true.
In accounting principles relating to financial institutions, there is the concept of “marking assets to market”—which can become a requirement or imperative. In the case of home mortgages, this means that if the face amount of a loan is greater than the market value of the home, the loan is “underwater” and the books (or balance sheet) of the bank should reflect this fact. In the absence of doing so, the bank’s assets are overstated (and distorted), and a false sense of well-being is conveyed to depositors, investors and the public alike.
American banks hold massive amounts of “toxic loans” today—or those that are non-performing or under-performing. Housing prices are expected to fall by at least another 50 percent in the next five years or so, which means that more and more loans will go into default or foreclosure. When this happens, the amount of toxic loans will grow dramatically; and if mark-to-market accounting rules were applied, this situation would become even more dire.
Applied to countries that hold sovereign bonds or other debt, the same principles govern. Small banks will be overwhelmed in the EU, the United States and globally. What this article fails to add is that things will get worse economically between now and the end of this decade; and that governments do not have any answers, because they are part of the problem.
Hold on tight. The worst is yet to come, far worse; and bank recapitalizations will be like adding small amounts of water to a pond.
See also http://www.nytimes.com/2011/09/07/business/global/in-euro-zone-banking-fear-feeds-on-itself.html?_r=1 (“In Euro Zone, Banking Fear Feeds on Itself”)
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The Bottom Will Drop Out Of The American Real Estate Market
In a sobering USA Today article entitled, “Rich and famous are mere mortals in soft real estate market,” it is stated:
See http://www.usatoday.com/money/economy/housing/story/2011-09-29/celebrity-house-sale/50609948/1
American housing prices will fall by at least another 50 percent in the next five years or so. The only possible exceptions to this will be in markets where international investors might make a difference.
We are in the midst of the “Great Depression II,” which economic historians will describe as such (or by using similar terms) 20-40 years from now. Things will get far worse during the balance of this decade.
Yes, there will be “green shoots” from time to time, or signs that things are getting better, but that was true during the Great Depression of the last century as well, which did not end until the onset of World War II, at the earliest.
When housing prices finally hit “bottom,” there will be bargains galore for those who have waited patiently on the sidelines with cash. Indeed, cash will be king!
Other Americans will suffer greatly, and lose everything material.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1817 (“A Series Of Anni Horribiles, Or Disastrous Years, Will Stretch Well Into This Decade”)
Lastly, USA Today had an article some time ago about the most over-priced communities in the United States, and that honor went to Santa Barbara, California—”the nation’s most out-of-whack market.” One can expect its real estate prices to be hit disproportionately over the next five years or so, as the bottom drops out, which is virtually a certainty.
See http://www.usatoday.com/money/economy/housing/2005-08-16-home-prices-usat_x.htm; see also http://www.bankrate.com/finance/real-estate/beach-towns-bargain-home-prices.aspx?ec_id=m1117367#slide=5 (Santa Barbara: “Foreclosures as a percentage of all sales: 46.78%”)
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Interesting information. I suspect most of us reading or taking a few minutes to reply to this cannot fathom what it is like to live in a palatial dwelling, getting lost within it, and then wanting to sell it. The Celebs who own, buy and sell their properties have gotten the means from us, the middle class, who continue to support them. I’ve given up going to the movies for various reasons; and after reading this, I am so glad that I have. Yes, in our Capitalist nation, they have earned their wealth, but it seems so disconcerting the way they use it to the point of, in my opinion, squandering it. Am I jealous? I hope not. Just thinking about having the means to buy a double-wide out in sunny California and enjoying every feature of it………………..especially ownership and privacy. We learned in elementary school about “wants and needs”—so be it.
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Economists: Consumers Won’t Save The Economy—Or Stop The Depression
While many economists are “whores,” who are far worse at predicting the future than weathermen (and women)—in terms of accuracy—USA Today notes, in an article that is essentially correct:
See http://www.usatoday.com/money/economy/story/2011-10-02/cnbc-consumers-economy/50619276/1
Consumer spending, which has been the engine of American growth in the past, will not lead the way during the next five years or so, and perhaps during the balance of this decade or longer.
The net worths of many American families have been decimated because of the decline in the values of their homes, and by the loss of such houses altogether in the case of many. Consumer spending had been fueled by a false sense of economic well-being, as housing prices soared and as more Americans borrowed heavily and spent like “drunken sailors.”
American housing prices will fall by at least another 50 percent in the next five years or so; and more Americans will lose their homes to foreclosure, or simply walk away from them, which will impact consumer spending even more dramatically. For the fortunate few who are able to sit patiently on the sidelines with cash, there will be bargains galore when the “bottom” is reached finally. Cash will be king!
For those Americans and their counterparts globally who have lost everything, it will be an economic depression and a living nightmare. Indeed, 20-40 years from now, economic historians will characterize this period as the “Great Depression II,” or by using similar terms. For these Americans, their materialistic dreams will be long gone.
Yes, there will be “green shoots” from time to time, or signs that the economy is improving, which was true during the Great Depression of the last century as well. However, that depression did not end until the onset of World War II, at the earliest; and this one may last just as long.
Hold on tight. Things will get very ugly between now and the end of this decade. There are no governmental solutions to these problems; and the human suffering will be staggering. Also, as I have written in the past:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html
In last November’s elections, Barack Obama and his Democrats suffered enormous political defeats, which may pale in magnitude when compared to what is coming next November!
See, e.g., https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-1843 (see also the article itself, as well as the footnotes and all of the comments beneath it)
. . .
In another article entitled, “Protectionism beckons as leaders push world into Depression”—and subtitled, “The world savings rate has surpassed its modern-era high of 24pc. This is the killer in the global system. It is why we are at imminent risk of tipping into a second, deeper leg of intractable depression”—the UK Telegraph‘s Ambrose Evans-Pritchard added:
See http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/8802462/Protectionism-beckons-as-leaders-push-world-into-Depression.html; see also http://www.cnbc.com/id/44758520 (“Greece Falls Into ‘Death Spiral’: Rising Debt, No Growth”) and http://abcnews.go.com/Business/wireStory/bernanke-economic-recovery-close-faltering-14663873 (“Bernanke Says Economic Recovery Close to Faltering”)
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The World Is Facing The Worst Financial Crisis In History
Of course Sir Mervyn King, Governor of the Bank of England, is correct in reaching this conclusion. Indeed, his views echo my comments in the article above, and in all of the comments beneath it. An article in the UK’s Telegraph quotes the Governor as stating:
See http://www.telegraph.co.uk/finance/financialcrisis/8812260/World-facing-worst-financial-crisis-in-history-Bank-of-England-Governor-says.html
As I have stated repeatedly, there is nothing that governments in the United States, the UK or elsewhere can do to thwart the economic tsunami from rolling worldwide, with unprecedented human suffering, lasting at least until the end of this decade.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1850 (“Economists: Consumers Won’t Save The Economy—Or Stop The Depression”) (see also the article itself, as well as the footnotes and all of the comments beneath it) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1848 (“The Bottom Will Drop Out Of The American Real Estate Market”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1828 (“European Banks Face Collapse Under Debts, Warns Deutsche Bank Chief”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1817 (“A Series Of Anni Horribiles, Or Disastrous Years, Will Stretch Well Into This Decade”)
. . .
In another very sobering article, the Telegraph added:
See http://www.telegraph.co.uk/comment/telegraph-view/8813441/An-entire-system-of-global-trade-is-at-risk.html
This echoes my conclusions more than two years ago:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html
Not only are Americans realizing that their politicians do not have the answers, but their counterparts in Europe and globally are realizing this as well. Barack Obama and his Democrats will not be reelected next November; and a similar fate may befall other politicians worldwide.
See https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/ (“Barack Obama Is A Lame-Duck President Who Will Not Be Reelected”) (see also the footnotes and all of the comments beneath the article)
Anger is growing globally, which is apt to reach unprecedented levels before the end of this decade. The economic tsunami will run its course toward the end of the decade; and there are no governmental solutions to these problems.
Hold on tight. The worst is yet to come, and it will be very ugly!
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Where And Why Keynes Went Wrong
The RAND Corporation has an interesting article that discusses Keynesian economics—in the context of Barack Obama’s failed and wasteful so-called “stimulus package,” and discusses why it failed—which is worth reading.
See http://www.rand.org/commentary/2011/11/07/WS.html
First, one must appreciate fully that Obama understands little or nothing about economics and business; and in both respects, he is a fool and a feckless naïf, and a tragic Shakespearean figure who will be forgotten and consigned to the dustheap of history—unless he tragically alters the course of American history.
See, e.g., https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/ and https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/ (“[I]n New York City before he moved to Chicago for the first time, he went to work as a research assistant at a consulting house to multinational corporations, where he recalled feeling like ‘a spy behind enemy lines'”)
He is America’s “Hamlet on the Potomac” and “Jimmy Carter-lite.” His naïveté is matched by his overarching narcissism; and he is more starry-eyed and “dangerous” than Jimmy Carter. When the stimulus package was be devised, then-House Speaker Nancy Pelosi and her Democrats were given the task of fashioning it, which they did to satisfy their constituents, regardless of whether the rest of America benefited or was hurt.
The RAND article notes:
Aside from the fact that the stimulus packages were politically contrived instead of being economically sound, they added to America’s debt burdens and created additional uncertainties, which produced negative effects on the U.S. economy. In short, they were wasteful, unmitigated disasters, which are among the many reasons why Obama will not be reelected next year, but will return either to Chicago or Hawaii no later than January of 2013, to lick his political wounds and write his memoirs, and work full time on his presidential library.
It cannot happen fast enough for the good of the United States and the American people!
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U.S. Companies Feel The Impact Of Europe’s Financial Mess
This is the title of an Associated Press article, which stated:
See http://www.usatoday.com/money/economy/story/2011-11-19/europe-crisis-affects-us-businesses/51300498/1?loc=interstitialskip
This article is sobering but accurate. The worst is yet to come, by far, during the balance of this decade!
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1859 (“The World Is Facing The Worst Financial Crisis In History”) (see also the article itself, as well as the footnotes and all other comments beneath it)
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The Euro Zone Is Collapsing
Perhaps it will not happen in a instant, and maybe there will be sporadic signs of relief in the future. However, it is inevitable, and just a matter of time. The calamity will rock the world.
The UK’s Economist, in a conservative, sobering article that must be read between the lines—which is subtitled, “The crisis in the euro area is turning into a panic. . . . The risk that the currency disintegrates within weeks is alarmingly high”—has noted:
See http://www.economist.com/node/21540259 (“Beware of falling masonry”)
Again, as written above: “The World Is Facing The Worst Financial Crisis In History.” Things will get very ugly during the balance of this decade!
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1859; see also http://www.cnbc.com/id/45435459 (“Dow, S&P Log Worst Thanksgiving Week Since 1932”) and http://www.nytimes.com/2011/11/26/business/global/banks-fear-breakup-of-the-euro-zone.html (“Banks Build Contingency for Breakup of the Euro”)
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The Fed Must Not Save Europe From Disaster
If the Fed seeks to do so, all of its governors must be investigated by Congress, removed from office, indicted and imprisoned. They would be gambling with the monies of the American people, and no less drastic measures would be required.
They are unelected and believe they are unaccountable; and they must be taught otherwise, for the good of the United States and the American people. They did this before, and they must be stopped from doing it ever again.
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1544 and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1126
It must never be forgotten that Alan Greenspan is directly responsible for and triggered the economic calamity that global economies are facing today, as well as what Americans are living through. As I wrote more than two and a half years ago in the American Banker, the daily newspaper of the banking industry:
See http://www.americanbanker.com/issues/173_212/-365185-1.html
No one has been punished—not Greenspan, or anyone else. This must change, and it should start with Greenspan. In another time and country, he would have been tried, convicted and executed by now.
As Ambrose Evans-Pritchard has written in the UK’s Telegraph:
See http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/8918784/Should-the-Fed-save-Europe-from-disaster.html (“Should the Fed save Europe from disaster?”)
As I have written, it is clear that the euro zone is collapsing. Neither the United States nor the Fed should do anything to prevent this from happening. Sooner or later an equilibrium or “bottom” will be reached, and then recovery can begin again. Until this happens, governments can do nothing except risk and waste finite and precious resources trying to prevent it—like futile attempts to plug up holes in a dam that is breaking or leaking like a sieve.
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1901; see also http://www.reuters.com/article/2011/12/04/us-eurozone-imf-fed-idUSTRE7B30X320111204 (“Fed may give loans to IMF to help euro zone: paper”)
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fascinating and thoroughly insightful//….if not altogether shocking and frightening. This is not a period of time to employ Ostrich Management techniques. I’d better get busy streamlining/.
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Euro Doomed From The Start, Says Architect Of The Single Currency
In an important UK Telegraph article—which is subtitled, “The euro project was flawed from the start and the current generation of European leaders has failed to address its fundamental problems, Jacques Delors, the architect of the single currency, declares today”—it is stated:
See http://www.telegraph.co.uk/finance/financialcrisis/8932647/Euro-doomed-from-start-says-Jacques-Delors.html; see also http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/8964183/Workers-of-Europe-unite-youve-only-euro-chains-to-lose.html (“The echoes of the 1930s are loud, and will become louder as combined monetary and fiscal contraction entrench depression“) and http://www.economist.com/node/21552250 (“Currency disunion: Why Europe’s leaders should think the unthinkable“)
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The Demise Of The Monetary Union
In an article entitled, “Britain, the IMF, and the world’s richest beggar,” the UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, has written:
See http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100013884/britain-the-imf-and-the-worlds-richest-beggar/
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2012 Could Be The Year Germany Lets The Euro Die
This is the title of another article by the UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, which states:
See http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/8987846/Ambrose-Evans-Pritchard-2012-could-be-the-year-Germany-lets-the-euro-die.html; see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1907 (“Euro Doomed From The Start, Says Architect Of The Single Currency”)
Hold on tight. The worst is yet to come, by far!
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Global Economy Could Endure Disaster For a Week
This is the title of a disturbing Reuters article, which states in pertinent part:
See http://www.cnbc.com/id/45899109
The ultimate “disruption,” of course, would be a nation-ending EMP Attack!
See https://naegeleblog.wordpress.com/2010/01/19/emp-attack-only-30-million-americans-survive/ (“EMP Attack: Only 30 Million Americans Survive”)
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Fed Members Laughed As Housing Bubble Grew
This is the title of a CNBC article, which is worth reading.
See http://www.cnbc.com/id/46194541
It is totally consistent with an article that I wrote for the American Banker, the daily newspaper of the U.S. banking industry, which was published on October 17, 2008, and entitled, “Greenspan’s Fingerprints All Over Enduring Mess.” In it, I wrote:
See http://www.americanbanker.com/issues/173_212/-365185-1.html
The chickens are still coming home to roost—long after the laughter ceased at the Fed—which will be true during the balance of this decade, in the United States and globally.
See, e.g., http://www.zerohedge.com/news/record-12-million-people-fall-out-labor-force-one-month-labor-force-participation-rate-tumbles- (“Record 1.2 Million People Fall Out Of Labor Force In One Month, Labor Force Participation Rate Tumbles To Fresh 30 Year Low“)
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America’s $25 Billion Pseudo-Foreclosure-Scandal Settlement Rewards Homeowners Who Gambled And Overextended Themselves
There are three articles on this subject that are worth reading: one in the Wall Street Journal, another at Bloomberg.com, and a third in the UK’s Economist.
See http://www.naegele.com/documents/ReviewandOutlook-25BillionBankJob.pdf and http://www.bloomberg.com/news/2012-02-09/foreclosure-deal-to-spur-new-wave-of-u-s-home-seizures-help-heal-market.html and http://www.economist.com/blogs/schumpeter/2012/02/americas-mortgage-settlement
As the Journal article states:
The words “a pseudo-foreclosure scandal” should be highlighted and underscored. Why should homeowners who overextended themselves be bailed out or rewarded at all? They gambled and lost. It is a scam by our government, once again.
The rosy scenario painted by this article, of how homeowners might be helped, could have been written at the Obama White House. For a much better and more accurate assessment, one should read the Bloomberg article, which states in pertinent part as follows:
The Economist added:
Unlike the RTC that came into being during the S&L crisis of the 1980’s and early 1990’s, and then went out of business, this monstrosity may stay with us . . . like ObamaCare. Indeed, Barack Obama’s demagoguery knows no bounds when he asserts that the actions of banks and other related institutions caused 4 million Americans to lose their homes to foreclosures. The banks and other lenders did not force borrowers to go into debt beyond their means and what they could afford. This is utter nonsense, a lie, and patently absurd.
To get rid of Barack Obama no later than January of 2013—and send him packing either to Chicago or Hawaii to lick his political wounds and write his memoirs, and work full time on his presidential library—will give the next president and his administration an opportunity to end all of this.
Having represented upwards of 200 banks, financial institutions and similar entities, I would recommend that no new mortgage loans should be made, inter alia, because of economic uncertainties during the balance of this decade and falling housing prices during at least the next five years. In fact, this is exactly what many of these institutions are doing.
No wonder American voters do not trust their politicians, much less those in Washington.
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Greece Is The Tip Of An Enormous Iceberg
This is essentially the conclusion of the UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, who has written:
See http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/9077586/Germanys-Carthaginian-terms-for-Greece.html; see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1956 (“2012 Could Be The Year Germany Lets The Euro Die”)
Similarly, American billionaire George Soros has warned that German Chancellor Angela Merkel’s policies could lead to a repeat of the Great Depression:
See http://www.breitbart.com/article.php?id=CNG.61735980a95dfd8997479bc085148e34.81&show_article=1 (“Merkel taking Europe in wrong direction: Soros”)
Hold on tight. Europe, including Germany, will be descending into chaos. It is merely a function of time before this happens.
. . .
Indeed, Orthodox primate Hieronymos II warned in a letter to Greece’s prime minister, which is quoted in the UK’s Telegraph:
See http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/9091837/Can-a-return-to-the-drachma-save-Greece-as-unemployment-soars.html (“No Greek bank has been able to issue a letter of credit accepted anywhere in the world since November” . . . “Germany may even leave the euro”)
This echoes what I wrote almost three years ago—or worse:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html
The Telegraph article concluded:
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George Soros helped all this financial disaster happen by putting Obama in the white house. Let the big greedy banks fail. Stop giving them the taxpayers money. Bush was bad. Obama is worse. Bank of NY Mellon made $2.4 billion in U.S pre-tax income in 2010 and received a $670 million federal tax refund. Wow, can someone explain how this is legal??? Together Bush and Obama gave $7.77 TRILLION to the banks. There is something so wrong with this picture. Put the robber barrons in jail. Don’t give them taxpayer money.
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Thank you, Dolora, for your comments.
First, I am not a fan of George Soros.
Second, the separation of commercial banking and investment banking (e.g., formerly known as “stockbrokers”) took place after Congress repealed the Glass–Steagall Act. It never should have happened; and if Paul Volcker had remained as Chairman of the Fed, I do not believe it would have happened. You might wish to read my comments on this subject.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1573 (“The Times Ahead Do Not Look Pretty”) (see also the article itself, as well as the footnotes and all of the other comments beneath it)
Third, I have represented upwards of 200 banks and other financial institutions, and have dealt with their CEOs and top management. They are very conservative, by and large. On the other hand, “investment bankers” are essentially gamblers, which is why commercial banking and investment banking do not (or should not) mix.
Fourth, lots of banks should have been allowed to fail, and many have already. The Government should have set up an entity like the RTC, which was used to solve the problems of the Savings and Loan industry, when lots of these institutions failed in the 1980s and early 1990s.
See, e.g., http://en.wikipedia.org/wiki/Resolution_Trust_Corporation
Fifth, there is plenty of blame to go around; and yes, the losses have been staggering. I do not believe GM or Chrysler should have been bailed out either, but the unions (e.g., the UAW) demanded it; and Obama gave in to them.
Lastly, I do not believe taxpayer money should be given away, or wasted. Too many people have worked too hard for that to happen, period.
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Plan For An Economic 9/11
This is the dire warning contained in a UK Daily Mail article, from analysts who urge Americans to buy guns and gold, and who predict a market crash and street riots within a year.
See http://www.dailymail.co.uk/news/article-2107315/Market-crash-street-riots-year-Americans-plan-economic-9-11.html
The possibility of this has been implicit in my writings and comments above, and earlier.
See http://www.americanbanker.com/issues/173_212/-365185-1.html and http://seekingalpha.com/instablog/2951-ilene-at-psw/31177-interview-with-timothy-d-naegele
For example, as I wrote almost three years ago:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html
A subtitle of the Daily Mail article is: “[A]nalysts say Americans will riot when another Great Depression hits.” Yet, it has hit already, for millions of Americans. The article adds:
Apart from chaos and anarchy—even worse than we have been witnessing in Greece already—the real risk is not a run on the FDIC-insured U.S. banks, but a run on those uninsured mutual funds and other investment vehicles that are invested in stocks, creating a liquidity crisis of epic proportions. When they fall, the thud will be heard around the world; and the house of cards will fall like dominos.
See also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2177 (“The Risk Of Runs Is Real”)
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Unmired At Last?
This is the conclusion of the UK Economist‘s staff who have clearly hedged their bets and wisely so, when writing about the American economy in a fine article—subtitled, “America’s recovery is neither robust nor dramatic. But it is real”—which is worth reading.
See http://www.economist.com/node/21550256
However, it misses the bigger picture.
First, one must realize that economists are like lemmings marching in lock step to the sea. They were wrong about predicting what happened in 2008, and thereafter; and they are wrong now too. Twenty-to-thirty years from now, economic historians—who at least have some credibility in describing the past—will characterize this period as the “Great Depression II,” or by using similar terms.
Like the Great Depression of the last century, this one will not end until late in this decade, or longer. Yes, there are “green shoots” or signs that things are improving, but they were present during the last depression too, which did not end until the onset of World War II, at the earliest.
Second, the United States is resilient and will fare better than other parts of the world, such as Europe; however, it will be hurt badly in the process too. Large numbers of Americans are suffering now, which will only increase dramatically. Real estate prices will fall another 50 percent in the next five years or so; and more and more Americans will lose their homes and everything else. It will not be a pretty picture; and there is nothing that governments can do to prevent it.
Indeed, Narcissistic demagogic politicians on both sides of the Atlantic will pontificate, but their words will fall increasingly on deaf ears. The people do not believe them anymore, and with good reason; and this will only get far worse. Most have no training whatsoever in economics; and they simply fashion their messages based on what they believe their constituents want to hear, which does nothing to solve the underlying economic problems.
Third, when the economic tsunami was unleashed—like a pebble thrown into a pond—the ripples and ultimately the waves have spread far and wide; and they are not remotely close to running their course. Man is unable to hold back a tsunami in the oceans; and the same is true of the economic tsunami that has been wreaking havoc around the world.
Fourth, there is a vast disparity in global wealth. One simply has to view the mega-mansions being built, and the megayachts plying the waters of the world, to realize fully that the common man’s plight has no relationship to the vast wealth of many. This may give rise to security issues for the wealthy that are unprecedented, as class warfare reaches new and potentially-dangerous levels. Conspicuous consumption may become a curse rather than a goal.
Only time will tell whether it is wise to plan for an “economic 9/11,” which may be coming.
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2024 (see also the article itself, as well as the footnotes and other comments beneath it)
Lastly, the reason why property tax revenues have been declining more slowly is because local governments have refused to adjust property values downward to reflect actual market conditions, which may give rise to a taxpayer revolt unto itself and/or exacerbate the loss of homes to foreclosure. Also, if Israel’s reckless Netanyahu has his way, war will Iran will begin later this year, which will make somewhat-rosy economic predictions seem like enormous fantasies.
See, e.g., https://naegeleblog.wordpress.com/2010/02/20/israels-senseless-killings-and-war-with-iran/#comment-2066 (see also the article itself, as well as the footnotes and other comments beneath it)
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The Euro’s Days Are Numbered
In an important article that is worth reading, the UK’s Economist noted:
See http://www.economist.com/node/21552250 (“Currency disunion: Why Europe’s leaders should think the unthinkable“) (emphasis added)
However, the present turmoil was foreseen; and one of its architects believes the euro was doomed from the start.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1907 (“Euro Doomed From The Start, Says Architect Of The Single Currency”)
Now the issue seems to be: how to arrange a relatively-amicable “divorce,” at a very precarious time in history, globally, when this and other events might send economies around the world into an even more rapid tailspin. Indeed, the rest of this decade is fraught with dangers, and may be ugly—at the very least economically.
See also http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/9184373/Wolfson-gurus-see-euro-break-up-as-dangerous-but-liberating.html (“A disorderly break-up of the euro would set off a cataclysmic chain-reaction and a collapse of Europe’s banking system, pushing the world into full-blown depression“)
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Obama’s Latest Scheme To Bail Out Gamblers And Distort Markets
Shaun Donovan, secretary of the U.S. Department of Housing and Urban Development, should be fired—but it will not happen because he mirrors the views of Barack Obama and his totally-failed presidency.
Donovan believes the federal government has a “legal responsibility” to approve loan modifications for certain homeowners, which of course is patently absurd—unless those homeowners are Obama’s constituents whom he wants to reward (or promise to reward) before November’s elections.
The Wall Street Journal has reported:
See http://blogs.wsj.com/developments/2012/04/06/hud-secretary-makes-case-for-mortgage-write-downs/
Donovan and the morally-bankrupt Obama Administration are advocating that the laws of economics should be thrown out the window, including market discipline that rewards prudence and penalizes gambling.
Yes, “some homeowners who owe far more than their homes are worth would conclude ‘there is really no light at the end of the tunnel’ and ultimately default on their mortgage.” This is how economics works. They will become renters, which is what they should have been in the first place.
“Homeownership” is a myth and a pipe dream for many, which was oversold and became a “sacred cow.” It is not a government entitlement—or if it is, we should all get free homes.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1630 and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1668 and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1997
Edward DeMarco is correct in thwarting principal forgiveness, but he does not fit into the Obama Administration’s political mold of rewarding gamblers and others who deserve no rewards, or worse. They gambled and lost. This is the lesson to be learned, not more government bailouts.
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Traditional Economists Are Clueless
An article appearing in the UK’s Economist discusses the differences between economists and historians, and the professional rivalry between the two groups.
See http://www.economist.com/blogs/buttonwood/2012/04/duelling-academics (“Duelling academics: Historians versus economists”)
First, there are “economic historians” who bridge and “marry” the disciplines—and will become increasingly important during the next 20-40 years, as they look back and describe this decade as the “Great Depression II.”
My undergraduate major was economics; and the last course that I took at UCLA was “Economic History.” I thought at the time that it was dry and boring, but I have realized for years now that it may have been the most important course in economics. Among other things, it described depressions and other economic upheavals over hundreds of years, which has helped to put the last century and this century into perspective.
Second, economists generally are like lemmings marching in lock step to the sea. Few are courageous enough to make predictions that are at odds with their peers, for fear of being ridiculed and viewed in academic circles as “heretics.” At best, they are capable of assessing what happened in the past, but essentially clueless with respect to predicting the future.
Their track records approximate those of weathermen (and women), whom—as most of us know—are dismal-to-pathetic in predicting today’s weather, much less the weather next week. Far too often, they are wrong, and decidedly so.
Third, global economies are being tested like never before, since the Great Depression of the last century, which did not end until the onset of World War II, at the earliest. This time, there are “green shoots” too—or signs that things are improving—which will turn into “dead weeds” with the passage of time.
The euro’s days are numbered—and it has been correctly observed:
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2110
Throw in the problems with North Korea, Iran, the collapse of Afghanistan, chaos in Pakistan, the “Arab Spring” that engulfs Israel and the rest of the region, China’s imperial ambitions in Asia and elsewhere, “dictator-for-life” Putin’s brutal ambitions, terrorists’ goals, and we have the recipe for very challenging times during the balance of this decade.
The human suffering will be enormous; and economists generally have their heads in the sand, and are oblivious to the storm clouds that are gathering.
Again, 20-40 years from now, economic historians will describe this period, but pure economists are essentially clueless today.
But see http://www.moneynews.com/StreetTalk/Shiller-Housing-home-Rebound/2012/04/24/id/436900?s=al&promo_code=EBB8-1 (“Yale’s Shiller: US Housing May Not Rebound ‘in Our Lifetimes’); see also http://www.reuters.com/article/2012/04/28/us-greece-election-suicide-idUSBRE83R08N20120428 (“Suicides have Greeks on edge before election“)
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If I Wanted America To Fail
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Housing: The Abyss [UPDATED]
Not surprisingly, it has been reported by Reuters—in an article entitled, “Falling home prices drag new buyers under water”:
See http://www.reuters.com/article/2012/04/26/us-usa-housing-negative-idUSBRE83P12E20120426 (emphasis added)
Those areas of the United States that have not been affected significantly yet, will join the other areas and be hit hard in the months and years to come. Writing in the Christian Science Monitor, leading economist Gary Shilling said:
See http://www.csmonitor.com/Business/new-economy/2012/0425/Fed-sees-more-growth-Don-t-count-on-it.-Recession-ahead (“Fed sees more growth? Don’t count on it. Recession ahead”); see also http://www.newsmax.com/Headline/shilling-housing-prices-falling/2012/04/27/id/437343 (“Shilling: Housing Prices Will Plunge 20 Percent More”) and http://www.moneynews.com/StreetTalk/Shiller-Housing-home-Rebound/2012/04/24/id/436900 (“Yale’s Shiller: US Housing May Not Rebound ‘in Our Lifetimes’“) and http://www.telegraph.co.uk/finance/recession/9233781/Double-dip-recession-to-trigger-house-price-fall.html (“Britain’s official return to [Double-dip] recession has raised the risk of a sharp fall in house prices, economists have warned”)
As I have written in comments above:
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1630; see also http://www.gallup.com/poll/154124/U.S.-Homeownership-Hits-Decade-Low.aspx (Gallup: “U.S. Homeownership Hits Decade Low”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1848 (“The Bottom Will Drop Out Of The American Real Estate Market”)
Whether the plunge in housing prices is 20 or 50 percent—or greater—remains to be seen. Clearly there will be geographical differences in the United States, just as there are now. In the final analysis, however, there is no question that cash will be king. Those with cash will be able to “bottom feed.” Between now and then, even more Americans and people of other countries will suffer like never before in their lifetimes, and dreams and hope will be crushed.
“Home ownership”—which has been touted by homebuilders, realtors and politicians for decades—will be exposed as a cruel, heartless and tragic pipe dream for many.
. . .
The housing crisis is hitting other countries as well. In an important article by the UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, which is entitled “France faces 40pc house price slump”—and subtitled, “France faces a property slump of Anglo-Saxon proportions as the frothiest boom in French history finally tips over, threatening the country with an economic shock just as austerity hits”—it is reported:
See http://www.telegraph.co.uk/finance/economics/houseprices/9244152/France-faces-40pc-house-price-slump.html; see also http://online.wsj.com/article/SB10001424052702303822204577464533347348246.html?mod=WSJ_hpp_sections_realestate (“Las Vegas Estate Price Slashed By Nearly 75% to $6.9 Million [And It Still Has Not Been Sold]“) and http://www.dailymail.co.uk/femail/article-2175497/Oprah-Winfrey-sells-Chicago-apartment-loss-2-75million–asking-price-HALF-figure-paid-years-ago.html (“Oprah Winfrey sells Chicago apartment at a loss for $2.75 million—under the asking price and HALF the figure she paid six years ago“) and http://www.cnbc.com/id/48240142 (“Foreclosure Crisis Hits Older Americans Hard”—”Older African-Americans and Hispanics are the hardest hit”) and http://live.wsj.com/video/prices-crash-at-luxury-golf-communities-/6C8347EB-8BFE-4C5E-B9F4-21361036480C.html (“Prices Crash at Luxury Golf Communities”) and http://www.moneynews.com/StreetTalk/Shiller-housing-upswing-questions/2012/11/01/id/462360 (“Yale’s Shiller to CNBC: Housing Recovery Could Take 50 Years“) and http://www.dailymail.co.uk/tvshowbiz/article-2230865/Sharon-Stone-finally-sells-lavish-Beverly-Hills-mansion-6-6million–takes-staggering-price-hit.html (“Sharon Stone finally sells her lavish Beverly Hills mansion for $6.6million… but takes staggering price hit”) and http://www.dailymail.co.uk/news/article-2243564/Firesale-Hamptons-estates-owners-try-unload-multimillion-dollar-homes-years-end.html (“Firesale of Hamptons estates as owners try to unload multimillion dollar homes before year’s end”) and http://www.telegraph.co.uk/finance/financialcrisis/9768067/Spains-house-prices-to-fall-another-30pc-as-glut-keeps-growing.html (“Spain’s house prices to fall another 30pc as glut keeps growing“) and http://www.telegraph.co.uk/finance/financialcrisis/9809723/SandP-sees-deeper-house-price-falls-in-eurozone-as-slump-engulfs-core.html (“S&P sees deeper house price falls in eurozone as slump engulfs core”—”France’s house . . . sales collapsed by 24pc in September from a year ago, the usual precursor of price capitulation by sellers”) and http://www.dailymail.co.uk/news/article-2307123/Home-buyers-paying-higher-percentages-income-new-house–worst-city-San-Francisco-houses-cost-seven-times-average-salary.html (“Home buyers are spending more of their incomes on houses now than they ever did before the housing bubble. . . . Real estate watchers fear that this could be creating a new housing bubble“)
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Suicides, Growing Despair And Hopelessness May Be The Future [UPDATED]
[Florence Owens Thompson was the subject of Dorothea Lange’s photo Migrant Mother (1936). The Library of Congress caption reads: “Destitute pea pickers in California. Mother of seven children. Age thirty-two. Nipomo, California.” See also http://www.dailymail.co.uk/news/article-2290879/I-lost-hope-Startling-interview-unearthed-woman-iconic-Great-Depression-image-talking-just-years-death-1983.html (“‘I never lost hope’: Startling interview unearthed with woman behind iconic Great Depression image talking just five years before her death in 1983”)]
. . .
During the Great Depression of the last century, there were stories about men jumping out of windows in the wake of the Crash on Wall Street, or otherwise committing suicide because they could not cope any longer. Also, there were images of poverty and despair such as Dorothea Lange’s famous photo of a mother and her children, which appears above and is forever etched into the American consciousness and psyche.
During the balance of this decade, as the “Great Depression II” continues to unfold and the economic tsunami runs its course, similar graphic reminders of human suffering will become increasingly evident. Indeed, a Reuters’ article entitled “Suicides have Greeks on edge before election” may foretell the future globally:
See http://www.reuters.com/article/2012/04/28/us-greece-election-suicide-idUSBRE83R08N20120428; see also http://hosted.ap.org/dynamic/stories/E/EU_GREECE_RISE_OF_THE_FAR_RIGHT?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2012-04-30-07-50-00 (“Rise of far right in Greece worries mainstream”) and http://www.telegraph.co.uk/finance/economics/9235091/Spains-woes-to-deepen-as-it-double-dips-into-recession.html (“Spain’s woes to deepen as it double-dips into recession”) and http://www.telegraph.co.uk/finance/financialcrisis/9235620/Cameron-says-eurozone-debt-crisis-has-years-to-run.html (“[UK’s] Cameron says eurozone debt crisis has years to run”) and http://www.wnd.com/2013/04/americans-snapping-by-the-millions/ (“STRESSED & DEPRESSED: AMERICANS ‘SNAPPING’ BY THE MILLIONS“) and https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/ (“Poverty In America”)
What has occurred in Greece may be a precursor of what is to come in Europe, in the United States and globally. Indeed, the human suffering may be unfathomable during the balance of this decade. Yet, the human spirit will survive and triumph ultimately.
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EXACTLY …America’s future is California, and California’s future is Greece
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Thank you, Colin, for your comment.
Indeed, you have summarized succinctly what I have said in other comments throughout this blog.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2300 (“California is the most populous U.S. state, and its gross domestic product (GDP) is larger than all but eight countries in the world. In a very real sense, it is a microcosm of America—and of things to come”)
I love California, where I was born and raised; and I love the United States too. We have a country that is second to none; and America will survive, despite tough times ahead. California will too; and its natural beauty is unsurpassed and can never be tarnished . . . or the resilience and undergirding faith of the American people.
See https://naegeleblog.wordpress.com/2010/02/26/america-a-rich-tapestry-of-life/
Sadly, Greece, Europe as a whole, and other parts of the world may not fare nearly as well as the United States.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2306 (“Greece’s Death Spiral”)
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Beware: Deflation Arrives, In China And Globally
As the UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, has written in an article entitled, “World edges closer to deflationary slump as money contracts in China”:
See http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/9263196/World-edges-closer-to-deflationary-slump-as-money-contracts-in-China.html
Ambrose Evans-Pritchard is correct. If anything, he is too conservative and “timid” in his predictions.
We are in the midst of the “Great Depression II,” which economic historians will describe as such 20-40 years from now. It will not run its course until the end of this decade, at the earliest. Between now and then, the human suffering will be unfathomable, and politicians will fall like dead flies.
Yes, there will be “green shoots” from time to time, or signs that things are improving. This was true during the Great Depression of the last century as well, which did not end until the onset of World War II, at the earliest.
Nicolas Sarkozy has been defeated in France. Barack Obama will be defeated in the United States. And other politicians will be exiting the world’s stage as well.
As I wrote more than three years ago:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html (“Euphoria or the Obama Depression?”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2134 (“Housing: The Abyss”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2135; see also http://www.telegraph.co.uk/finance/financialcrisis/9263758/Backlash-in-Europe-threatens-to-derail-austerity-measures.html (“Backlash in Europe threatens to derail austerity measures”) and http://www.telegraph.co.uk/finance/comment/rogerbootle/9263156/The-final-death-throes-of-the-euro.html (“The final death throes of the euro“) and http://www.economist.com/node/21554549 (“The euro crisis”) and http://www.cnbc.com/id/47428134 (“[T]wo things that will change my attitude about this market is if we see a depression in Europe and a hard-landing in China”—both may be coming) and http://www.telegraph.co.uk/news/worldnews/europe/greece/9268507/Greece-on-brink-of-collapse.html (“Greece on brink of collapse“) and http://www.telegraph.co.uk/finance/financialcrisis/9270884/Debt-crisis-Greek-euro-exit-looms-closer-as-banks-crumble.html (“Debt crisis: Greek euro exit looms closer as banks crumble“)
Hold on tight. Things will get very ugly!
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The Power Of Hope
An article in the UK’s Economist about this subject is worth reading.
See http://www.economist.com/node/21554506
Hope and faith in God are needed today, and will be required during the balance of this decade, more than at any other period in our lifetimes. People will be tested like never before.
Compare https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2160 with https://naegeleblog.wordpress.com/2010/05/12/what-and-where-is-god/ (see also the footnotes and comments beneath both articles)
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Education Will Change Radically
In response to my comments that online education is the future, one well-meaning but naïve commenter wrote:
In turn, I responded:
If anything, this may be an understatement.
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The Risk Of Runs Is Real
[Bank run, circa 1933]
The UK’s fine Economist has an article that is worth reading and reflecting on, dealing with runs on financial institutions in Europe, and implicitly worldwide. It is entitled, “Europe’s biggest fear: A run they cannot stop,” and among other things it notes:
See http://www.economist.com/blogs/schumpeter/2012/05/europes-biggest-fear
This article is correct, and its concerns are real. The risk of runs and “contagion,” worldwide, are enormous.
For many years, a major unspoken worry among financial policymakers in Washington has been that there would be a run on America’s mutual funds—or money market investment funds—that would create a liquidity crisis that could not be stemmed by our Fed, and that a panic might ensue.
See, e.g., http://www.smartmoney.com/invest/mutual-funds/why-mutual-fund-guardians-are-failing-1339088682278/?link=SM_hp_ls1e (“Why Mutual Fund Guardians Are Failing”)
Banks are shaky all over the world today; and perhaps the safest are those in the United States because of FDIC insurance. Indeed, the flight of capital to American banks and other investment vehicles from abroad may increase dramatically in the months and years to come, as this decade truly becomes one annus horribilis after another. People will be seeking “safe havens” for their money, and the United States may be the only one.
Twenty-to-forty years from now, economic historians will look back on this period, stretching through the end of this decade at least, and describe it as the “Great Depression II,” or by using similar terms. Yes, there will be “green shoots” from time to time, or signs that things are improving—which was true during the Great Depression of the last century that did not end until the onset of World War II, at the earliest.
Hold on tight. Things will get very ugly, and the human suffering will be unfathomable.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2160; see also http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/9278253/Rising-US-recession-risk-poses-the-real-threat-to-Europe.html (“[F]orecasters fear that America has already fallen back into recession, replicating the terrible double-dip of 1937”)
One other factor that is worth mentioning. While Americans are accustomed to the value of FDIC deposit insurance, the people of other nations are not. I bought a failing savings and loan (later a federal savings bank) in San Francisco for clients based in Hong Kong, which at the time was the largest minority financial institution in the United States. Many of its depositors were newly arrived from China, and they spoke no English and had no idea what FDIC insurance was.
Indeed, I was told that they had little experience with banks themselves, and literally kept their money under mattresses. Having timidly trusted our predecessor bank, we were very concerned about the effects of its collapse and our takeover of it. Most importantly, we were very concerned about a run on the bank.
We brought in experts from Hong Kong to shape our media blitz in several Chinese dialects, assuring depositors that their money would be safe after our takeover. Extrapolate this to other countries, where fear can dominate and runs can become panics overnight, and financial systems can collapse. Governments will be powerless to stop them.
. . .
An article in the UK’s Telegraph entitled, “For the eurozone, the worst is yet to come,” is worth reading and very sobering as well:
See http://www.telegraph.co.uk/finance/comment/liamhalligan/9292092/For-the-eurozone-the-worst-is-yet-to-come.html; see also http://www.economist.com/blogs/newsbook/2012/05/indias-economy (“A BRIC hits the wall: India’s economy lurches further down”) and http://www.economist.com/node/21556577 (“The world economy is in grave danger” . . . and there is “a rising risk of financial catastrophe”) and http://www.telegraph.co.uk/finance/debt-crisis-live/9328172/Debt-crisis-live.html (“Greeks take millions from banks ahead of election”) and http://www.cnbc.com/id/47793980 (“Greeks Withdraw $1 Billion a Day Ahead of Vote”) and http://www.telegraph.co.uk/finance/financialcrisis/9333246/Debt-crisis-Rich-Greeks-in-London-face-tax-investigation.html (“Rich Greeks in London face tax investigation”) and http://hosted.ap.org/dynamic/stories/U/US_MAPPING_GREECES_EXIT?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2012-06-16-09-58-56 (“How shock waves will hit US if Greece drops euro”—”[T]he risk would be high for a run on banks throughout Europe. People would worry that the banks might fail and would rush to withdraw what they could. . . . [T]he crisis could get much worse: Banks could fail, the surviving banks could stop lending to each other, and a credit freeze could shut down commerce in Europe. . . . [T]he dollar would soar to trade nearly even with the euro“)
. . .
At some point, fear and contagion will prevail, and the banking systems of many countries may be overwhelmed and fail. Politicians and governments will be helpless to prevent it. Like a natural tsunami in the great oceans of this world, the economic tsunami will roll unabated through the end of this decade, at the very least.
. . .
As I wrote more than three years ago:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html
There is zero doubt that the worst is yet to come globally, by far. The risk of runs is real, as fear and panics spread!
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Americans’ Wealth Drops 40 Percent, With Much Worse Yet To Come
The Washington Post has reported:
See http://www.washingtonpost.com/business/economy/fed-americans-wealth-dropped-40-percent/2012/06/11/gJQAlIsCVV_story.html
To “sugar-coat” what has been happening (e.g., so Americans will not panic), both the Fed and the Post refer to it as the “Great Recession,” when in reality it is the “Great Depression II,” which is how economic historians are likely to describe it 20-40 years from now—or by using similar terms.
The Post also refers to signs that things are improving, or “green shoots,” which were present during the Great Depression of the last century as well—which did not end until the onset of World War II at the earliest.
Hold on tight. The worst is yet to come . . . by far . . . during the balance of this decade, and the human suffering will be unfathomable!
While foreigners have been snapping up properties in the U.S., housing prices will fall by another 20-50 percent in the next five years or so. When the “bottom” is reached finally, there will be bargains galore for those people who have amassed cash, and waited patiently on the sidelines and then went “bottom feeding.”
See, e.g., http://online.wsj.com/article/SB10001424052702303901504577460550067846454.html and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2134 (“Housing: The Abyss”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2177 (“The Risk Of Runs Is Real”) (see also the article itself, as well as the footnotes and other comments beneath it) and http://www.foxbusiness.com/government/2012/06/12/may-budget-deficit-up-from-year-earlier/ (“DEFICIT DOUBLES IN YEAR“)
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EU Doomsday Scenarios To Limit Bank Runs And Capital Flight
The risk of runs on banks and other financial intermediaries (e.g., mutual funds, or money market investment funds) is discussed above.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2177 (“The Risk Of Runs Is Real”)
However, consideration is being given to “limiting cash withdrawals and imposing capital controls . . . [and] the possibility of suspending the Schengen agreement, which allows for visa-free travel among 26 countries, including most of the European Union.”
See http://www.irishtimes.com/newspaper/breaking/2012/0612/breaking24.html; see also http://news.yahoo.com/eu-movement-money-people-limited-144836122–finance.html;_ylt=A2KJ3CV.WNdPN10AzDzQtDMD (“[L]imits could be imposed on movement of people and money across national borders within the EU if it’s necessary to protect public order or public security”) and http://www.eubusiness.com/news-eu/finance-public-debt.h3c and http://online.wsj.com/article/SB10001424052702303768104577458301368089854.html (“How the Euro Will End”) and http://ca.news.yahoo.com/us-wont-send-checks-europe-romney-154702519.html (“US won’t send checks to Europe: Romney”) and http://www.telegraph.co.uk/finance/comment/9337283/Greece-will-have-to-leave-EMU-whoever-is-elected.html (“Europe’s depression is spreading”) and http://www.telegraph.co.uk/comment/9337911/Dithering-Europe-is-heading-for-the-democratic-dark-ages.html (Greece: “Every day we read of fresh horrors: of once proud bourgeois families queuing for bread, of people in agony because the government has run out of money to pay for cancer drugs. Pensions are being cut, living standards are falling, unemployment is rising, and the suicide rate is now the highest in the EU—having been one of the lowest. . . . For the sake of bubble-gumming the euro together, we are willing to slaughter democracy in the very place where it was born. What is the point of a Greek elector voting for an economic programme, if that programme is decided in Brussels or—in reality—in Germany?”) and http://www.smartmoney.com/invest/currencies/euro-on-the-brink-1341940632005/?link=SM_hp_invest (“Euro on the Brink”) and http://www.telegraph.co.uk/finance/financialcrisis/9424793/Europe-is-sleepwalking-towards-imminent-disaster-warn-top-economists.html (“The euro has completely broken down as a workable system and faces collapse with ‘incalculable economic losses and human suffering’ . . . according to a group of leading economists“)
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China Transmits A Fresh Deflationary Impulse To A World Already Dangerously Close To Deflation
These are the words of the UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, who has written—in an article entitled, “China exports yet more excess capacity to crippled West”:
See http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100018516/china-exports-yet-more-excess-capacity-to-crippled-west/
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STOCKS MIGHT BE 50 PERCENT LOWER WITHOUT FED!
This is the shocking, but not surprising conclusion of a report from the Federal Reserve Bank of New York that is discussed in a CNBC article, which states in pertinent part:
See http://www.cnbc.com/id/48165921
As I have said repeatedly, the stock market is a “fool’s paradise”—or the world’s largest casino—and the fools are the American people and others abroad who believe and invest in it!
See, e.g., http://seekingalpha.com/instablog/2951-ilene-at-psw/31177-interview-with-timothy-d-naegele (“Interview with Timothy D. Naegele”); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1464 (“Bernie Madoff: The Market Is A Whole Rigged Job, And There’s No Chance That Investors Have In This Market“) and http://www.americanbanker.com/issues/173_212/-365185-1.html (“Greenspan’s Fingerprints All Over Enduring Mess“)
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Commercial Banking Distinguished From Investment Banking, Or Gambling
The UK’s Economist has an interesting article about the problems with banking, which is worth reading.
See http://www.economist.com/node/21558584
However, the article proceeds from a false premise. The author tars all bankers, which is mistaken.
In the United States, the separation of commercial banking from “investment banking”—or gambling—existed until “deregulation” and the elimination of Glass-Steagall. Former Federal Reserve Board Chairman Alan Greenspan was and is the culprit; and his much-more-talented, wiser and valiant predecessor, Paul Volcker, has tried to put the “Genie” back into the bottle without much success unfortunately. The damage has been done, and we are living with it.
See, e.g., http://www.americanbanker.com/issues/173_212/-365185-1.html (“Greenspan’s Fingerprints All Over Enduring Mess”) and http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html (“Euphoria or the Obama Depression?”)
Second, commercial bankers are paid essentially what they have earned for decades, adjusted for inflation. Their “investment banking” counterparts, the true gamblers, have been compensated as they have been for decades too; namely, at exorbitant rates. The problem is that they gamble with the “house’s money” now, which can produce great rewards or nightmares—and certainly nightmares for their American banking regulators, such as the Fed and the FDIC.
Third, the article refers to “rogue employees who have ignored the corporate culture.” All of this makes sense only if one realizes that there have been two very separate and distinct cultures: the commercial bankers, who are largely conservative and have been for ages; and the “investment bankers” who are gamblers of the worst sort. The only culture to which they have paid homage is the almighty dollar, or other currencies—as the case may be.
Fourth, a fascinating study was just released by the Federal Reserve Bank of New York, which indicates that “the S&P 500 would be more than 50 percent lower—at the 600 level—if the bullish price action preceding Fed announcements was excluded.” Thus, traders (or gamblers—also known as “investment bankers”) could make money by doing nothing more than correctly analyzing the Fed moves, which is arguably much more important than stock picking.
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2222
Fifth, the article is correct to point out the doctrine that has undergirded American bank regulation for decades; namely, “too big to fail.” Unfortunately, deregulation and the elimination of Glass-Steagall allowed the foxes into the chicken coops: the “investment banker” gamblers became part of the formerly-conservative commercial banks, and the game changed forever—for the worse.
See also http://www.dailymail.co.uk/news/article-2173171/London-whale-ousted-JP-Morgan-says-blunder-cost-5-8-BILLION-fired-executives-forced-BACK-pay-past-years.html (“JP Morgan admits London Whale blunder cost $5.8 billion—TRIPLE the original estimate—as fired executives are forced to give BACK pay for past two years“) and http://www.naegele.com/documents/TheCaseAgainstRestoringGlass-Steagall.pdf (“The Case Against Restoring Glass-Steagall”)
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Greek Economy Is In Great Depression Similar To The American One In The 1930s, Prime Minister Says
According to an article in the UK’s Telegraph:
See http://www.telegraph.co.uk/finance/financialcrisis/9418656/Debt-crisis-Greek-economy-is-in-a-Great-Depression-says-Samaras.html; see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2135 (“Suicides, Growing Despair And Hopelessness May Be The Future”) and https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/ (“In Greece today, parents are giving away their children because they cannot afford them. Kids are being dumped in streets or abandoned at shelters with notes attached to them, saying that one or both parents are at wits’ end“)
Clinton is correct.
Greece is not the only country in the depression. Twenty to forty years from now, economic historians will describe these times as the “Great Depression II,” which will not end until the close of this decade, at the earliest.
Yes, there will be “green shoots” from time to time, which occurred during the Great Depression of the last century as well—which did not end until the onset of World War II, at the earliest. However, overall things will be very ugly, and the human suffering will be unfathomable.
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China’s Hard Landing
The UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, has written another article that is worth reading, this time about China:
See http://www.telegraph.co.uk/finance/economics/9465651/Hard-landing-for-China-as-factory-prices-fall-and-deflation-looms.html; see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2220 and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2160 and http://www.telegraph.co.uk/finance/financialcrisis/9491069/China-bubble-in-danger-zone-warns-Bank-of-Japan.html (“China bubble in ‘danger zone’ warns Bank of Japan”) and http://seekingalpha.com/instablog/2951-market-shadows/31177-interview-with-timothy-d-naegele (Regarding beliefs that China has bottomed out and its economy is on the mend, and now is a good time to “buy a stake” in China, it must never be forgotten that “the stock market is a ‘fool’s paradise'”) and https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/ and http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100021244/us-to-overtake-saudi-arabia-in-oil-as-chinas-water-runs-dry/ (“US to overtake Saudi Arabia in oil as China’s water runs dry”)
Clearly, the worst is yet to come!
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IMF: Global Recovery “Will Take At Least Six More Years”
As the UK’s Telegraph has reported:
See http://www.telegraph.co.uk/finance/financialcrisis/9585027/IMF-Global-recovery-will-take-at-least-six-more-years.html
As a public figure, Blanchard was being prudent and conservative in his statements. Yet, they are totally consistent with what I have written above; namely, we are in the midst of the “Great Depression II,” which will not run its course until the end of this decade, at the earliest.
Furthermore, governments are not the solutions; and most governmental efforts will make the problems markedly worse.
Hold on tight. The worst is yet to come, by far!
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Happy Days Are Not Here Again
This is the title of a Wall Street Journal editorial, which requires emphasis. One must remember that there were “green shoots,” or signs that things were improving, during the Great Depression of the last century too, which did not end until the onset of World War II at the earliest.
The editorial states:
See http://online.wsj.com/article/SB10000872396390444223104578038623709703516.html?mod=WSJ_hpp_sections_opinion
The “Great Depression II” continues its brutal march forward, following a path not dissimilar to the Great Depression. And Barack Obama’s political fate next month is likely to mirror that of Jimmy Carter, who was a one-term president too.
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Your words seem almost prophetic. You wave a flag of caution and I agree with it. The challenge is what should the fathers and mothers on this Thanksgiving holiday be doing? Bonds?, get out of the Market? Cash only? What is your wisdom on this…? with thanks!
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Thank you, Rod, for your comments.
I have been “preaching” cash only for a long time now, and the idea of sitting on the sidelines patiently, waiting for the “bottom”—which will be reached in the American housing market in about five years or so. Then, there will be bargains galore for those who are able to go “bottom feeding.”
Please read the comments above this one (and beneath my article above), and you will find that they are consistent with what I have just written.
Will others make money with bonds or stocks or other investments in the interim? Sure . . . people make money gambling all of the time, but most lose money. The surest “bet,” or so I believe, is to be conservative and wait for the bottom.
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I am embarassed that I think I NEED to be in the Market. I do appreciate you reminding me that the Market is the biggest CASINO around…why do I think I have to have my money in it?? If everybody is doing it…that is a good reason not to!
With great thanks!
Rod from Vancouver!
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Thank you again, Rod, for your comments and kind words.
You might wish to read my responses in an interview three years ago, inter alia, about the market being a “fool’s paradise.” This remains true today.
See http://seekingalpha.com/instablog/2951-market-shadows/31177-interview-with-timothy-d-naegele
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Crime Will Increase Dramatically In America
During the balance of this decade, crime will increase in the United States as economic conditions worsen and poverty increases, and as criminals are released because of overcrowding in the prisons, and as law enforcement declines because of budgetary cutbacks that cannot be avoided. One shining example is the State of California.
The UK’s Daily Mail has reported in an article entitled, “Bursting at the seams: Uncompromising pictures from inside America’s overcrowded prison system show the cramped and impersonal lives lived by more than two million inmates”:
See http://www.dailymail.co.uk/news/article-2223626/Prisons-America-breaking-point-million-citizens-bars.html; see also http://sanfrancisco.cbslocal.com/2012/10/30/chickenpox-outbreak-puts-san-quentin-state-prison-on-lockdown/ (“Chickenpox Outbreak Locks Down San Quentin”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/ (“The Economic Tsunami Continues Its Relentless And Unforgiving Advance Globally”) and http://www.dailymail.co.uk/news/article-2238577/Maria-Santos-Gorrostieta-executed-surviving-assassination-attempts.html (“They got her in the end: Mexico’s fearless woman mayor who survived two drug gang assassination attempts is beaten to death and dumped by the roadside“)
California is the most populous U.S. state, and its gross domestic product (GDP) is larger than all but eight countries in the world. In a very real sense, it is a microcosm of America—and of things to come.
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Greece’s Death Spiral
The UK Telegraph has two articles about Greece that are worth reading. In the first one by Ambrose Evans-Pritchard, International Business Editor of The Daily Telegraph, he writes:
See http://www.telegraph.co.uk/finance/financialcrisis/9647098/Greek-death-spiral-raises-heat-for-German-bloc-creditors.html
In the second article, also by Evans-Pritchard, he writes:
See http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100021059/the-german-bloc-will-have-to-take-its-bitter-medicine-in-greece/; see also http://www.cnbc.com/id/49606194 (“Greece Running Out of Cash; Government Under Threat”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2235 (“Greek Economy Is In Great Depression Similar To The American One In The 1930s, Prime Minister Says”) and http://www.cnbc.com/id/49757552 (“Greece Says Cash Reserves Almost Depleted”)
The chickens are coming home to roost, and the human suffering and political turmoil will be staggering—as the economic tsunami continues its relentless and unforgiving advance, globally.
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This blog is very hard to study and understand because the various posts do not have a day month and year tag.
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Thank you, Mike, for your comment.
First, I did not design the format. It is a WordPress.com Web site; and it uses a “template.”
Second, the day, month and year of all articles and the comments beneath them are indicated. For example, the quotation that you cited appears in the article of mine at the top of this page entitled, “The Economic Tsunami Continues Its Relentless And Unforgiving Advance Globally,” which was published on “27/9/2010” or September 9, 2010. Footnote 5 refers the reader to two other articles that may be of interest.
Similarly, your comment (or post) immediately above this one was published on “2/11/2012,” or November 2, 2012, which is today; and the day, month and year are indicated to the right of your comment. The same thing is true of these comments of mine, and all other comments above yours.
Third, once the articles such as the one at the top of this page are published, I do not make any changes to them. However, my comments beneath the articles are sometimes updated.
For example, I have a comment above entitled, “Housing: The Abyss” (see https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2134), which I updated this morning to include a new article entitled, “Yale’s Shiller to CNBC: Housing Recovery Could Take 50 Years” (see http://www.moneynews.com/StreetTalk/Shiller-housing-upswing-questions/2012/11/01/id/462360).
The date of that addition (or update) is not shown; however, the day, month and year of all articles and the comments beneath them are shown.
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This is very sobering stuff, which I very much agree with. The problem is the general public seems only to react to sensationalism, then goes back to watching “Homa Simpson” in a stupefied state. Now is the time to prepare for the coming events as they slowly, ever so slowly unfold. Your decade long timeline may be a little understated?
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Thank you, Martin, for your comments.
Yes, indeed, my timeline may be understated. For example, Yale University economist Robert Shiller has warned it could take 50 years for U.S. housing to return to its previous levels.
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2134; see also http://www.telegraph.co.uk/finance/financialcrisis/9681868/1930s-medicine-pushes-Europe-back-into-double-dip-recession.html (“[I]t is going to get worse next year. . . . Europe has imposed dusted-off policies from the 1930s and they are driving peripheral countries towards depression”) and http://www.telegraph.co.uk/finance/globalbusiness/9676259/US-Conference-Board-fears-Brics-miracle-over-as-world-faces-decade-long-slump.html (“US Conference Board fears Brics miracle over as world faces decade-long slump”) and http://www.telegraph.co.uk/finance/financialcrisis/9720053/French-economy-buckles-as-car-sales-collapse.html (“French economy buckles as car sales collapse”)
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The West Is Signing Its Own Death Sentence
On April 8, 2009, in an op-ed “Commentary” for the McClatchy Newspapers and McClatchy-Tribune News Service entitled “Euphoria or the Obama Depression?” I wrote:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html; see also http://www.naegele.com/whats_new.html
People are suffering in the United States, the UK, Europe and elsewhere in the world; and this will only get far worse during the balance of this decade.
See, e.g., https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/ (“Poverty In America”)
Before the McClatchy piece, in an October 17, 2008 article for the American Banker—the daily newspaper of the U.S. banking industry—entitled, “Greenspan’s Fingerprints All Over Enduring Mess,” I wrote:
And I added:
See http://www.americanbanker.com/issues/173_212/-365185-1.html
The chickens are coming home to roost. In an excellent and sobering article by Janet Daley in the UK’s Telegraph entitled, “The West is signing its own death sentence,” she has written:
See http://www.telegraph.co.uk/news/politics/georgeosborne/9730434/The-West-is-signing-its-own-death-sentence.html; see also http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/9733486/Europe-clings-to-scorched-earth-ideology-as-depression-deepens.html (“Europe clings to scorched-earth ideology as depression deepens“) and http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9733547/World-risks-fresh-credit-bubble-Switzerlands-BIS-warns.html (“World risks fresh credit bubble, Switzerland’s BIS warns”) and http://www.washingtonpost.com/opinions/charles-krauthammer-the-right-to-work-dilemma/2012/12/13/28e2ce2c-4567-11e2-8061-253bccfc7532_story.html (“The right-to-work dilemma”)
Politicians in America, Europe and elsewhere are economic naïfs at best. Most have had zero training in economics, and they have been leading the world down the primrose path to the “Great Depression II.” One must never forget that the Great Depression of the last century did not end until the onset of World War II, at the earliest; and this depression is not likely to run its course until the end of this decade, at the earliest.
There were “green shoots,” or signs that things were improving, in the Great Depression as well. However, 20-to-40 years from now, economic historians will look back and describe what has been happening and will continue to unfold through the end of this decade as the “Great Depression II,” or by using similar descriptions. The human suffering will be very similar in America, the UK, Europe and globally.
America is likely to fare better than the rest of the world, but it will not escape from massive human suffering, which will be unfathomable.
Hold on tight. Things will get very ugly!
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During the top of the housing bubble, 2005, before blinders were removed and collapse had ensued, Greenspan had signaled his crash-the-economy-on-purpose culpability by advising, during an interview with reporters, THIS QUITE INSANE – as well as being an unethical abridgement of his keep-my-mouth-shut, don’t-move-the-markets, Federal Reserve chairmanship duties! – AND VERY HARMFUL nudge to prospective home buyers: “I think they ought to use an adjustable rate mortgage.”
Why would he advise home buyers to do that, unless he was feeling giddy about helping to do the most harm to the market and mortgage holders when HIS PURPOSEFULLY PLANNED BUBBLE had popped? But for what sinister purpose?
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U.S. Lambasts China For Breaches Of Trade Rules
This is the title of an article in the UK’s Telegraph by its International Business Editor, Ambrose Evans-Pritchard—and subtitled, “Washington has issued a blistering attack on China for persistent breaches of world trade rules and abuse of industrial secrets, accusing Beijing of failing to abide by treaty obligations”—which states:
See http://www.telegraph.co.uk/finance/globalbusiness/9765348/US-lambasts-China-for-breaches-of-trade-rules.html
As an article of mine and the comments beneath it state clearly:
One must never forget that China is America’s enemy: make no mistake about that.
See https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/
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The GOP Saw The “Fiscal Cliff” Looming, And Drove Over It—Into A Fiscal Abyss
The “deal” is done, and Americans will suffer because of it.
See http://www.huffingtonpost.com/2013/01/01/fiscal-cliff-deal-passed-_n_2394022.html (“Fiscal Cliff Deal Passed By Congress After Republicans Cave“); see also http://thehill.com/homenews/house/275295-boehner-tells-gop-hes-done-with-one-on-one-obama-talks (“Boehner tells GOP he’s through negotiating one-on-one with Obama”) and http://www.usnews.com/news/blogs/washington-whispers/2013/01/02/inside-obamas-kailua-beach-vacation-homes (“Obama’s Hawaii vacation has cost taxpayers $7 million, due to the costs of flying Air Force One and an extensive security operation”)
After working on and with Capitol Hill for much of my adult life, I concluded many years ago that the Democrats are “evil” and the Republicans are “Neanderthals,” which is why I have been an Independent for approximately 25 years—having first been a Democrat, and then a Republican.
See https://naegeleblog.wordpress.com/2010/03/31/the-rise-of-independents/
The latest madness in Washington is that the “loyal opposition,” the GOP, caved into Barack Obama to avoid the so-called “Fiscal Cliff,” and instead they drove over it and into a fiscal abyss of unknown depths. Now, the Republicans are fighting among themselves; and the only clear victors are Obama and his Democrats, who completely routed the hapless Republicans as they did in the 2010 lame duck session of Congress.
See https://naegeleblog.wordpress.com/2010/03/31/the-rise-of-independents/#comment-1190 (“The Great Republican Ascendancy Of 2010 Lasted Less Than Two Months!”)
The Republicans are pathetic, which is among the many reasons why they do not control the White House today. African-Americans and Hispanics turned out in record numbers to reelect Obama, while large numbers of Republicans did not vote. Thus, they are getting what they deserve, with much worse coming, while Americans will suffer enormously because of their ineptitude, cowardice, and spinelessness.
See http://www.boston.com/news/politics/2012/president/2012/12/23/the-story-behind-mitt-romney-loss-the-presidential-campaign-president-obama/2QWkUB9pJgVIi1mAcIhQjL/story.html (“The story behind Mitt Romney’s loss in the presidential campaign to President Obama”)
. . .
As I have written in the article above, the economic tsunami continues its relentless and unforgiving advance globally, and will not run its course until the end of this decade at the earliest.
Hold on tight. Things will get much worse.
The human suffering will be unfathomable—in Europe, the United States, and globally. Governments are not part of the solution; they contribute to the problems, intensify them, and move us closer to the financial abyss.
Today, politics on both sides of the Atlantic is “fractured,” to say the least. While U.S. politicians and their counterparts in other countries have been trying to convince their electorates that they have the answers, they are simply holding out false hopes that real solutions are at hand.
See, e.g., http://www.myfoxchicago.com/story/20601722/1-in-3-illinoisans-lives-in-or-near-poverty-level-report (In The Land of Lincoln—and Obama—1 in 3 Near Poverty)
. . .
There are at least three theories that are operating with respect to Germany’s future—which bears on the future of Europe: (1) the rest of the Eurozone will take down the German economy; (2) Germany’s Chancellor Angela Merkel will not be able to save the other countries, and Germans will retreat economically to “fortress Germany” and abandon the euro; and (3) Germans will achieve what they did not in World War II, namely to become the “masters of Europe.”
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1732 (“Will The Euro Crisis Will Give Germany The Empire It Has Always Dreamed Of?”)
Indeed, it must be noted:
(1) “Germany’s Bundesbank is to repatriate gold reserves held abroad to tighten control and combat currency crises in the future, pulling a chunk of its holdings from New York and all its bullion from Paris.”
(2) “Many analysts say the world is moving towards a de facto gold standard again as China, Russia and other reserve powers boost their holdings to diversify out of dollars and euros.”
See http://www.telegraph.co.uk/finance/personalfinance/investing/gold/9804444/Bundesbank-to-pull-gold-from-New-York-and-Paris-in-watershed-moment.html (“Bundesbank to pull gold from New York and Paris in watershed moment“); see also http://www.telegraph.co.uk/finance/financialcrisis/9789086/Brussels-fears-poverty-trap-for-half-of-Europe-as-North-South-gap-widens.html (“Brussels fears ‘poverty trap’ for half of Europe as North-South gap widens“) and http://www.telegraph.co.uk/finance/financialcrisis/9809723/SandP-sees-deeper-house-price-falls-in-eurozone-as-slump-engulfs-core.html (“S&P sees deeper house price falls in eurozone as slump engulfs core”—”France’s house . . . sales collapsed by 24pc in September from a year ago, the usual precursor of price capitulation by sellers”) and http://www.telegraph.co.uk/news/9826857/Britain-is-experiencing-worse-slump-than-during-Great-Depression.html (“Britain is experiencing ‘worse slump than during Great Depression’“) and http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9825363/Bank-of-America-issues-bond-crash-alert-on-Fed-tightening-fears.html (“Bank of America issues `bond crash’ alert on Fed tightening fears”—”The . . . question is whether the world economy really is at the start of a fresh cycle of growth, or whether the roaring asset rally of the last few months is another false dawn“) and http://www.dailymail.co.uk/news/article-2269094/North-Korean-parents-eat-children-driven-mad-hunger-famine-hit-pariah-state.html (“North Korean parents ‘eating their own children’ after being driven mad by hunger in famine-hit pariah state“)
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i stopped thinking years ago
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Don’t give up, John.
America is likely to fare better than the rest of the world.
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The Fiscal Cliff Explained, And Sequestration
What appears below was sent to me by a lawyer-friend in Washington, D.C.; and neither of us created it, nor do we vouch for the accuracy of the numbers cited. However, I have little doubt that they are close enough.
See also http://cnsnews.com/news/article/real-federal-spending-82290-american-2008 (Drudge: “FEDERAL SPENDING UP $822.90 PER PERSON SINCE OBAMA“) and http://www.washingtonpost.com/opinions/charles-krauthammer-hail-armageddon/2013/02/28/ca8a32a6-81da-11e2-b99e-6baf4ebe42df_story.html (“[F]or Obama, this is not about deficit reduction, which interests him not at all. The purpose is purely political: to complete his Election Day victory by breaking the Republican opposition“)
. . .
If the issue of Sequestration was not so vitally important to our national security and well being, it might be laughable, but it is deadly serious.
See http://thehill.com/blogs/defcon-hill/operations/283981-pentagon-tells-congress-it-will-furlough-800k-civilian-workforce (“Pentagon informs Congress of plans to furlough 800K civilian workers“) and http://timesofindia.indiatimes.com/world/us/US-issues-worldwide-caution-to-its-citizens-of-terror-threats/articleshow/18589455.cms (“US issues worldwide caution to its citizens of terror threats“) and https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-2090 (“Obama Is A Traitor“) and http://www.washingtonpost.com/opinions/bob-woodward-obamas-sequester-deal-changer/2013/02/22/c0b65b5e-7ce1-11e2-9a75-dab0201670da_print.html (Bob Woodward: “Obama’s sequester deal-changer”) and https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-2494 (“Obama’s Enemies List And His Thugocracy“); see also https://naegeleblog.wordpress.com/2010/01/19/emp-attack-only-30-million-americans-survive/ (“EMP Attack: Only 30 Million Americans Survive“)
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89,304,000 AMERICANS: NOT WORKING
It has been reported:
See http://cnsnews.com/news/article/296000-americans-drop-out-labor-force-february
. . .
As Peggy Noonan noted in the Wall Street Journal:
See http://online.wsj.com/article/SB10001424127887323628804578346680172271600.html?mod=WSJ_hps_sections_opinion
This is totally consistent with my article on the economy and the comments beneath it. The worst is yet to come, and things will get very ugly!
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/ (“The Economic Tsunami Continues Its Relentless And Unforgiving Advance Globally”); see also https://naegeleblog.wordpress.com/2010/12/22/the-next-major-war-korea-again/#comment-2501 (“North Korea Says It Will Launch Nuclear Attack On America“) and https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/ (“China Is America’s Enemy: Make No Mistake About That”) and https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/#comment-2301 (“Crime Will Increase Dramatically In America”) and https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-2494 (“Obama’s Enemies List And His Thugocracy”)
Noonan added:
This is so so true. I grew up a block away from the fabled Sunset Boulevard in Westwood, a mile west of the lovely UCLA college campus, in an affluent area of Los Angeles—with the super-rich Beverly Hills to the east, Bel Air to the northeast, and Brentwood, Pacific Palisades and Malibu to the west. Leaving the UCLA campus recently, I hit a pothole in the street near the campus, which was similar to those I had hit in Washington, D.C. a number of years before. The streets that I had traveled on my bike as a kid, to watch movies at the Village and Bruin theaters in Westwood, have not been paved in all those years. Hefty tax monies paid by residents have been diverted elsewhere, and wasted.
Noonan continued:
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2483 (“The Fiscal Cliff Explained, And Sequestration”); compare http://www.nationalreview.com/corner/342366/white-house-saving-18000-week-cancelling-tours-patrick-brennan (“White House Is Saving $18,000 a Week By Cancelling Tours”) with http://www.dailymail.co.uk/tvshowbiz/article-2290937/MoS-Diary-Adele-lands-biggest-gig-Michelle-Obamas-50th-birthday-party.html (“ADELE, BEYONCE TO PERFORM AT MICHELLE’S 50TH [BIRTHDAY PARTY]”); see also https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-1172 (“Michelle Obama: ‘Let Them Eat Cake!'”) and http://www.latimes.com/business/money/la-fi-mo-savings-financial-emergency-20130130,0,4750796.story (“Nearly half of Americans are one emergency from financial ruin“)
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Eurozone Risks Japan-Style Deflation Trap As ECB Stays Tight
In an article by Ambrose Evans-Pritchard, the UK Telegraph‘s International Business Editor, it is reported:
See http://www.telegraph.co.uk/finance/financialcrisis/9916592/Eurozone-risks-Japan-style-deflation-trap-as-ECB-stays-tight.html; see also http://www.telegraph.co.uk/finance/economics/9926656/Eurozone-industry-in-the-doldrums-as-production-worse-than-expected.html (“Eurozone industry in the ‘doldrums’ as production worse than expected“) and http://www.telegraph.co.uk/finance/economics/9924954/UK-on-track-for-triple-dip-NIESR.html (“UK on track for triple dip“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2502 (“89,304,000 AMERICANS: NOT WORKING“) and http://www.latimes.com/business/money/la-fi-mo-savings-financial-emergency-20130130,0,4750796.story (“Nearly half of Americans are one emergency from financial ruin“)
. . .
Perhaps most sobering and disturbing are the warnings of Luxembourg’s Prime Minister Jean-Claude Juncker, one of Europe’s most senior politicians, who contends that (1) Europe’s demons are only sleeping, (2) peace is being taken for granted on the continent, and that (3) Europe’s current troubles were chillingly similar to those in the run up to World War I.
In a UK’s Telegraph article, it is reported:
See http://www.telegraph.co.uk/news/worldnews/europe/germany/9922063/Jean-Claude-Juncker-Europes-demons-are-only-sleeping.html
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Worldwide Approval And Image Of The United States Declines Under Obama
POLITICO has reported:
See http://www.politico.com/story/2013/03/world-poll-image-of-us-declines-88816.html (“World poll: Image of U.S. declines”)
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The Great Green Con—”Global Warming” Is A Myth
Like the “Tooth Fairy” and the “Easter Bunny,” the notion of man-made “global warming” is a myth and fraud that has been foisted on Americans and others worldwide. It is akin to Adolf Hitler’s “master race” theory: pure poppycock.
An article in the UK’s Daily Mail discusses “the hard proof that finally shows global warming forecasts that are costing you billions were WRONG all along,” In the article—which is subtitled “No, the world ISN’T getting warmer (as you may have noticed). Now we reveal the official data that’s making scientists suddenly change their minds about climate doom. So will eco-funded [Members of Parliament] stop waging a green crusade with your money? Well… what do YOU think?”—it is reported:
See http://www.dailymail.co.uk/news/article-2294560/The-great-green-1-The-hard-proof-finally-shows-global-warming-forecasts-costing-billions-WRONG-along.html (emphasis added); see also http://www.dailymail.co.uk/news/article-2301851/Coldest-Easter-Sunday-100-YEARS-temperatures-plummet-12C-Britain-shivering-week.html (“Coldest Easter Sunday in 100 YEARS: Temperatures plummet to -12C as Britain faces another week of bitter weather (but at least there’s some signs of spring)“) and http://www.cnsnews.com/news/article/what-global-warming-2012-data-confirms-earth-cooling-trend (“What Global Warming? 2012 Data Confirms Earth In Cooling Trend“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1127 (“The Lunacy Of The Global Warming Hoax Is In Full Swing“)
All of the money being spent worldwide to address “global warming” would be better spent in pursuit of the “Loch Ness Monster” and the “Abominable Snowman”—or in chasing rainbows.
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The Dow of Tiger Woods
This is the title of a Wall Street Journal article, which is worth reading at least in part:
See http://online.wsj.com/article/SB10001424127887324105204578384832555959160.html?mod=WSJ_hpp_sections_sports
Before his “accident” in Florida, Woods was under the care of a doctor who promoted performance-enhancing drugs such as HGH: Anthony Galea, who visited Woods “at least four times” at his Florida home, and was under a joint U.S.-Canadian investigation for providing athletes with such performance-enhancing drugs.
Also, as I have written:
See https://naegeleblog.wordpress.com/2009/12/17/is-redemption-possible-for-tiger-woods (see also all of the comments beneath the article)
It is unlikely that Woods will ever be considered the greatest golfer of all time, inter alia, because the truth about his doping will come out with the passage of time, which will forever tarnish his place in golf.
Indeed, I know at least one person who knows the inside, true story with respect to Woods, and will probably tell it sooner or later. The revelations will be “shattering.”
Next, there are fewer black (or African-American) players on the PGA Tour today than when Woods began. He has done nothing to change this . . . except to line his own pockets as Narcissists do. Years ago, there were Lee Elder, Charlie Sifford and Jim Dent.
Woods confessed to having 121 affairs during his five-year marriage, and this will haunt him forever as well.
See, e.g., http://www.mirror.co.uk/celebs/news/2010/04/29/woods-tells-elin-i-slept-with-121-girls-115875-22219848/ (“Tiger Woods confessed to having 121 affairs during his five-year marriage. . . . The world’s top golfer . . . is said to have told estranged wife Elin Nordegren the amazing number of women he bedded during her visit while he was in rehab”)
It is often asked how Woods was able to get away with doping and his sexual escapades. The short answer is that he is black; and to a large extent, “political correctness” has shielded or sheltered him from criticism. If cyclist Lance Armstrong was black, he might have been treated differently too. Clearly, race is a big factor that protects Woods, which cannot be underestimated.
Also, before his “accident,” Woods was golf’s “cash cow” and it was essentially a “one-player” sport. People followed golf because of him, and lots of people made plenty of money because of him. Indeed, the PGA and its disgraceful commissioner Tim Finchem—who should have been fired ages ago—never ordered an independent investigation of the doping charges against Woods, which were swept under the rug and buried. No other sport would have done this.
The media has buried the facts because of the reasons cited above, and because America has become a celebrity-driven society in which anything goes—including lying, cheating, prostitutes, bimbos and the like.
Regardless of his golf scores, Woods is a doping, utterly disgraced, porn “star”/escort/and other bimbo-seeking, Narcissistic philanderer. Like the Dow, what goes up often comes crashing down, especially in troubled times like these—which will only get far worse between now and the end of this decade.
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/ (“The Economic Tsunami Continues Its Relentless And Unforgiving Advance Globally”) (see also all of the comments beneath this article)
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The Great Depression II Is Here To Stay, And It Will Last At Least Through The End Of This Decade
While many Americans and the “elite” of other countries have never had it so good financially—including Barack Obama and his family—as their yachts cruise the waters of the Mediterranean, the Caribbean, and elsewhere in this world, others are living in poverty and utter desperation. This will continue unabated for many years to come, with no relief in sight. As I have written, things will only get far worse; and the human suffering will be unfathomable.
See, e.g., https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/ (“Poverty In America“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2135 (“Suicides, Growing Despair And Hopelessness May Be The Future“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2177 (“The Risk Of Runs Is Real“) and https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/#comment-1172 (“Michelle Obama: ‘Let Them Eat Cake!'”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1516 (“Debtors’ Prisons“)
Evidence of this is reflected in the latest statistics released by the U.S. Census Bureau:
See http://news.yahoo.com/help-shrinks-poverty-spikes-us-122230503.html (“Help shrinks as poverty spikes in the US“); see also http://www.dailymail.co.uk/news/article-2302997/U-S-sees-highest-poverty-spike-1960s-leaving-50-million-Americans-poor-government-cuts-billions-spending.html (“U.S. sees highest poverty spike since the 1960s, leaving 50 million Americans poor as government cuts billions in spending“) and http://www.zerohedge.com/news/2013-04-05/people-not-labor-force-soar-663000-90-million-labor-force-participation-rate-1979-le (“[T]he number of people not in the labor force . . . in March soared by a massive 663,000 to a record 90 million Americans who are no longer even looking for work“)
It is a myth and downright lie woven by our politicians and their counterparts in other countries that America and Europe are slowly climbing out of the deepest economic downturn since the Great Depression of the 1930s. It must never be forgotten that the depression of the last century did not end with the onset of World War II, but rather it abated only after the war’s end. During the 1930s, there were “green shoots” as there are now—or signs that things were improving economically—which did not materialize until the end of that devastating war.
As I wrote almost four years ago:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html; see also https://naegeleblog.wordpress.com/2010/12/22/the-next-major-war-korea-again/#comment-2501 (“North Korea Says It Will Launch Nuclear Attack On America”) and https://naegeleblog.wordpress.com/2010/01/19/emp-attack-only-30-million-americans-survive/ (“EMP Attack: Only 30 Million Americans Survive”) and https://naegeleblog.wordpress.com/2012/03/08/the-madness-of-benjamin-netanyahu (“The Madness Of Benjamin Netanyahu”)
And I added almost four years ago:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html; see also http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9985280/Big-banks-more-dangerous-than-ever-IMFs-Christine-Lagarde-says.html (“Big banks ‘more dangerous than ever’, IMF’s Christine Lagarde says“)
The chickens are coming home to roost as fewer and fewer Americans and other nationalities trust their governments, and as economic and other forms of chaos reign.
HOLD ON TIGHT. THINGS WILL GET VERY UGLY!
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America faces so many problems that it is difficult to be optimistic at all regarding the future. I firmly agree with your assessment that “things will get very ugly!” How can they not? Aside from all the pressing economic and political troubles, we have deteriorating social problems as well. Certainly, we are not the same nation morally that we were during the first Great Depression where neighbors reached out to help others that were worse off than they were. My father often told me stories of how my Grandmother would give food to neighbors that were poorer than they were. Today, the morality is such in America that rather than “help” a neighbor, many would probably rob them, or simply ignore those that were in need. Such are the fruits of, as you state, “godless secularism” inspired by the “gods of materialism.” When the economy REALLY turns down, it will make the “crisis” of 2008 look like the proverbial picnic. I firmly believe that the crisis of 2008 was only a prelude to the real crisis. You are so right … hold on tight!
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Thank you for your comments, Ray. I agree with them completely.
Indeed, you have summed up the issues that the United States and Americans face, very succinctly. In all of my articles at this blog, beginning with the very first one about Barack Obama, I have tried to describe these issues and comment about them.
See https://naegeleblog.wordpress.com/articles/
While not engaging in platitudes and excessive puffery, I believe the United States is the greatest country on earth, and that the American people are exceptional—all of them.
However, what is coming will test us like never before; and it will make 2008 seem like child’s play. It will rival the 1930s, or be even worse. The reason is that most Americans are not prepared for it, and may seriously consider giving up completely. This is when one’s faith in God—or a “higher power”—will be tested like never before.
Interestingly enough, other parts of the world and their peoples will be hurt much worse than we will. The UK and Europe come to mind; however, as my article above relates, the effects will be felt globally. Nations and peoples are interconnected like never before. For example, if the Internet went down—as an act of war—the effects would be unprecedented in history.
My parents were in their 20s when the Great Depression of the last century hit; and from what I was told, it did not affect them adversely at all. They had been schoolmates in Minneapolis, and had come west to California; and my father had a good job in Beverly Hills. He and my mother and their respective families rode out the depression and the war economically. However, things changed for our family when my mother became ill before I graduated from grade school.
She almost died; and my father spent a small fortune on medical care before the advent of medical insurance, involving doctors who had been trained at the Mayo Clinic in Minnesota. At my sixth grade graduation in the Brentwood suburb of Los Angeles, she came to it in a wheelchair, and I was so embarrassed. No other mothers were like that; and it happened years before attention was given to the disadvantaged. I was an only child, and I had no one to talk with about it; and I did not understand why it had hit our family.
Many years later—after she had survived and recovered, having had her right leg amputated to stem her illness—she went on to lead Red Cross volunteers who helped military service members and their loved ones cope with the family stresses of the Vietnam War. She had friends galore, who loved her for herself; and ultimately, she survived because of her faith in God. We as a family survived because of that too; and my parents remain my only heroes in life; and my faith continues to this day.
The United States will survive, and so will our fellow Americans; however, the challenges will be great.
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The U.S Economy Is Poised For A Major Crash
It has been reported:
See http://moneymorning.com/ob-article/jim-rogers-major-crash-ahead.php?code=118409 (emphasis added); see also http://www.youtube.com/watch?v=HPXnI5qRP6U (“Jim Rogers Interview with NewsMax TV 20 May 2013”)
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76 Percent Of Americans Are Living Paycheck-To-Paycheck!
CNNMoney has reported:
See http://money.cnn.com/2013/06/24/pf/emergency-savings/index.html; see also http://www.breitbart.com/Big-Government/2013/07/05/only-47-americans-have-full-time-job (“ONLY 47% OF ADULTS HAVE FULL-TIME JOB”)
As the U.S. and global economies get far worse between now and the end of this decade, more and more Americans and those in other countries will slide into desperate poverty.
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The “Great Depression II” Marches Onward
In an article entitled, “Risk of 1937 relapse as Fed gives up fight against deflation,” the UK Telegraph‘s International Business Editor, Ambrose Evans-Pritchard, writes:
See http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/10144451/Risk-of-1937-relapse-as-Fed-gives-up-fight-against-deflation.html
The worst is yet to come, and the landing will not be soft—at least for most Americans.
See, e.g., https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/#comment-2626 (“76 Percent Of Americans Are Living Paycheck-To-Paycheck!”) (see also the article itself, as well as the other comments beneath it)
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The Wheels Are Coming Off The Whole Of Southern Europe
This is the title of an article by the UK Telegraph‘s International Business Editor, Ambrose Evans-Pritchard, which is subtitled:
Evans-Pritchard goes on to state:
See http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/10172530/The-wheels-are-coming-off-the-whole-of-southern-Europe.html (emphasis added); see also http://www.telegraph.co.uk/finance/comment/10198408/If-you-think-Britain-is-on-its-way-back-to-prosperity-think-again-its-a-mirage.html (“Rather than this being a genuine recovery, we are merely entering the latest stage in an ongoing bubble that began at the start of the previous decade and which keeps being reflated, with the painful but inevitable denouement still at least another crisis away”)
The chickens are coming home to roost. Hold on tight. Things will get very ugly!
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4 Out Of 5 in USA Face Near-Poverty, No Work . . .
The AP has reported:
See http://bigstory.ap.org/article/exclusive-4-5-us-face-near-poverty-no-work-0; see also http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/10214989/Commodity-supercycle-in-rude-health-despite-shale.html (“[W]e are in a global trade depression, albeit one contained by monetary stimulus. . . . Russia and Brazil have ground to a near halt. China is in its second ‘mini-recession’ in two years, its growth rate near zero on a GDP deflator basis. . . . What is clearly true is that US fracking has transformed America’s economic and strategic prospects, slashing gas costs for industry to one third of European and Asian levels, and reviving the US chemical, glass and steel industries in what we now call the US manufacturing renaissance. . . . We should think of shale as one-generation play for the US, enough to ensure American superpower primacy into the middle of the century”)
. . .
As I have written:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html
Hold on tight. It will get far worse globally between now and the end of this decade!
. . .
But nothing interrupts the Obamas’ lavish vacations!
See, e.g., http://washingtonexaminer.com/obama-vineyard-vacation-at-7.6m-private-resort-over-75-rooms-booked-for-staff/article/2533598 (“Obama Vineyard vacation at $7.6m private resort, over 75 rooms booked for staff”) and http://www.whitehousedossier.com/2013/07/29/wh-tours-parade-special-visitors-continues/ (“Still No [White House] Tours, but Parade of Special Visitors Continues”)
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There is no doubt in my mind that we are heading into some very dark times … both economically and socially. The seeds of class warfare have been sewn mightily by the Obama administration, and when this house of cards economy is finally exposed for the sham that it really is, things have the potential to get very ugly. Along with America’s mess, with the exception of Germany, most of Europe is in even worse shape. Europe’s collapse will surely lead to global economic chaos. Add to that Japan’s experiment with Zimbabwe-type economics (Abenomics) where seemingly the answer to all its problems is to simply devalue the currency (as if other trading partners will simply sit on their collective hands). After being suckered into the historic global credit binge, China’s miracle economy in no longer expanding at anywhere near the rate they are currently claiming (7.5%). As if that weren’t enough, the Middle East, always somewhat chaotic, has entered into a time of heightened and dangerous turmoil. Currency wars, which always lead to trade wars, which often lead to military conflict, are rampant and on the increase.
I believe we are going to see a global meltdown that will make 2008 look very tame in comparison. Financially and politically, the world is in a far weaker position now than we were in 2008. The world’s central bankers have used up all of their tricks that they had in their bag, and it has not worked. We are in a horrible fix with a mixture of problems facing us that seem insurmountable. Back to America, while viewing the political landscape (of BOTH parties), do you feel hope or despair? Personally, I put zero hope in these charlatans.
“Hold on tight” is an understatement. You might want to consider a death grip!
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Thank you, Ray, for your comments. I agree completely. You have summed up the situation in a nutshell.
I have no faith in any of the politicians, but I have inherent faith in the American people. There will be lots who are hurt, but our country will survive, while other countries will not fare nearly as well.
You may not have noted the latest with respect to oil shale.
See http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/10209822/US-shale-threatens-Saudi-funding-crisis-and-demise-of-OPEC.html
This is wonderful news for the United States . . . if America’s “environmental Nazis”—and I am a hiker, and lover of nature—do not curtail our production of oil, as they have done off the coast of California and in the Gulf of Mexico.
See also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1692 (“The Future Still Belongs To America”) and https://naegeleblog.wordpress.com/2010/02/26/america-a-rich-tapestry-of-life/ (“America: A Rich Tapestry Of Life”)
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I agree with you that “our country will survive,” but will it resemble the great nation of our Forefathers, or will it be closer to that of the Euro social/welfare state variety? I personally think we are already there, at least to the extent that the foundations have thoroughly been laid via FDR’s “New Deal” (aka Raw Deal) and LBJ’s “Great Society.” Add to that mix the phony “conservatives” that profess a sincere desire to return to the constitution, while far too often promoting the expansion of the federal government on a vast scale. Consider several illustrations: the “conservative” Bush 43’s Medicare Part D (completely unfunded), was the largest social/welfare program since LBJ. His “No Child Left Behind” (another Gov’t sham) also vastly expanded the Dept. of Education’s size and power. Add to that the disastrous wars in Iraq and Afghanistan … planned in advance of the 9/11 attacks by the warmongering Neo-conservatives … and subsequently cheered on by the so called “conservatives.” The fact that both of these wars were not only unwarranted, they were also unconstitutional never seems to bother these “conservatives.” As a “constitutional conservative” myself, I’m often embarrassed to refer to myself as such because of these “conservative” types.
Regarding shale oil, in my opinion, it will not be enough to stop the hemorrhaging of our national debt. The reported $17 trillion (on “hold” for about 65 days now) that the media touts is of course only the tip of the proverbial iceberg. When counting our long-term obligations, such as Social Security (SS is broke), Medicare (being raided to fund Obamacare), Medicaid, Government pensions, etc., etc. our national debt is well over $100 trillion. Note: when Treasury Secretary Paul O’Neill attempted to point that fact out to the “conservative” George W. Bush, he was promptly fired. Add to the national debt our corporate and personal debt, etc. and one has difficulty concluding otherwise; this nation is technically bankrupt.
Back to: will America survive? Of course it will. The real question is what will its survival be? Will it be the America where individual freedom is exalted via “life, liberty and the pursuit of happiness” without the tentacles of an oppressive government bureaucracy or will it be that of the all-powerful, centralized, social/welfare state? What has the trend been for the last 50+ years? What is there that indicates this trend is suddenly going to reverse course?
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Thank you again, Ray. I find it difficult, if not impossible, to disagree with what you have written.
As long as the “Progressives” aka Liberals (i.e., there is nothing progressive about them, except when viewed in the context of Marxist-Leninist ideology) are running this country, and the GOP is essentially a “doormat,” the march toward a socialist state (or worse) will continue.
There are vast numbers of Americans who agree with us, whether they describe themselves as conservatives, Independents or by some other label. In Nixonian terms, they are the “silent majority,” which is becoming increasingly vocal.
For a variety of reasons, I believe one of the most critical issues is to defeat any new immigration legislation. This might give the Dems a permanent majority in Congress, which would thwart any efforts to stop the Liberal train.
See https://naegeleblog.wordpress.com/2010/07/30/illegal-immigration-the-solution-is-simple/ (“Illegal Immigration: The Solution Is Simple”)
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Rome used the barbarians to help fight their wars, which were often wars fought against other barbarians invaders. In the end, the barbarians turned on the Romans and occupied vast regions of the western empire. Eventually, it was the Visigoths, led by the barbarian Alaric that sacked Rome in 410. The real lesson of history is that we learn nothing from history.
American politicians from both parties support some form of amnesty for illegal immigrants. Both parties are pandering for votes. It appears that our political “leaders” hope that illegal immigrants, once they are made “legal” will suddenly become honest taxpayers, which will in turn bring massive revenues into the government coffers, allowing the government Ponzi scheme to continue into the foreseeable future. Then too, the corporations (the real movers and shakers of our politicians) demand cheap, plentiful, low-wage labor. Real wages for the American worker, when factoring in inflation, have not risen in over 30 years. The ongoing influx of hardworking immigrants, often willing accept lower than minimum wage and share a rental property with 20+ of their fellow compatriots, does not bode very well for maintaining the standard of living for the American worker. Life is going to be much harder in the very near future for the American laborer.
A very real danger also exists whereby the USA becomes “Balkanized” as vast regions of the Southwest could possibly secede, with the purpose of uniting with what millions of Mexicans believe to be the rightful owner of these lands … Mexico. This may seem far-fetched now, but if the human flood gates remain open, and there is every reason to believe they will be, that entire region may in fact be overrun with non-Americans.
Mr. Naegele, I believe you are right. Any immigration deal is unthinkable, unless of course these globalists have something different in mind other than preserving America as the “last and best hope of mankind.”
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Thank you again, Ray, for your very thoughtful comments and insights, with which I agree in large part.
Hispanic Americans are very hard workers, at least in California; and they assimilate quickly. In one generation, their kids are speaking perfect English; and they become full-fledged Americans. It is wonderful to see and experience. Yes, there are gangs—Blacks and Hispanics—but the Hispanics, by and large, are very family-oriented and examples for the rest of us.
My article that I cited above gives my views about immigration, so I will not repeat them here, other than to say that there are lots of people who have been waiting for years to enter this country legally. They should be given first preference, period.
Will this country fragment and fracture? God only knows why we have been blessed, but immigrants have come to our shores for hundreds of years, and they have become Americans. Their goals were not to tear this country apart. The same is true, I believe, of Hispanics. They are wonderful people, who only want to participate in the “American dream,” whatever that means to any of us.
They are our latest arrivals; and most of them—again, in California—work and work and work, and have genuine smiles on their faces when doing so.
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NO American Cities Should Be Bailed Out, Beginning With Detroit!
It has been reported:
See http://www.realclearpolitics.com/articles/2013/08/02/dems_favor_federal_bailout_of_detroit_public_does_not_119482.html (“Dems Favor Federal Bailout of Detroit, But Majority of Public Opposed”)
If the Democrats are truly serious and genuine, they will begin collecting purely voluntary donations from their own Liberal constituency, and by raiding the Party’s coffers, to fund Detroit and other cities.
Cities are anachronisms. They are unsafe and unhealthy, and ugly places to live and work. Today, many are filled with people who would prefer to riot and hurt others than deal with their own needs.
I was born and raised in Los Angeles, which has a vast metropolitan area. However, most Angelenos have probably never been to downtown LA. There is no need to do so. The freeways are clogged, and there is nothing remotely beautiful about the city center; just pavement and high-rises, which may have serious problems when the next major earthquake strikes.
See https://naegeleblog.wordpress.com/2010/09/08/earthquakes-the-big-one-is-coming-to-at-least-los-angeles/ (“Earthquakes: The Big One Is Coming To At Least Los Angeles”)
Barack Obama was a “community organizer” who was supposed to help with the problems of our cities. However, he has had zero impact on Detroit and Chicago, except to fan black racisim. And he had no effect as a community organizer either, except to stir up racial anger and hatreds. Down deep, is he a racist? Of course he is; just read (or reread) his book, “Dreams from My Father.” It is all there, in his own words.
See https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/
Also, the future is in computers and telecommuting. There is no need to go to high-rise office buildings in downtown LA or anyplace else to work. Indeed, there are “virtual companies” today, where the key people are linked by computers, and there is no need for formal offices.
Detroit is rotting, and other cities are rotting too, but so what? Let them rot. They have outlived their usefulness. Like the horse and buggy, their time has passed. Some may argue: “Detroit once had the highest per capita income in the United States, which meant the world.” The answer is: “So what? We used to get around on horseback too.” Also, Henry Ford was smart enough to move out of Detroit.
The streets of Westwood—where the lovely UCLA campus is located, and where I grew up and went to school and college—have potholes in them because the exorbitant tax revenues have been siphoned off to meet the needs of the inner city of Los Angeles. Enough is enough. We do not owe anything to cities, much less to prop them up.
Cities are passé. The Internet will make this true, more and more. Not one cent of federal or State monies should have been used to prop up New Orleans.
See also http://www.washingtonpost.com/opinions/charles-krauthammer-steins-law/2013/07/25/f45acb30-f567-11e2-aa2e-4088616498b4_story.html (Detroit: “Forty percent of the streetlights don’t work, two-thirds of the parks are shut down and emergency police response time averages nearly an hour—if it ever comes at all”)
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Drop In Number Of Students Accepting University Places
This is the title of an article in the UK’s Telegraph, which bears out what I wrote in an earlier article:
See https://naegeleblog.wordpress.com/2011/07/29/are-colleges-dinosaurs/ n.2 (citations omitted) and http://www.telegraph.co.uk/education/educationnews/10216357/Drop-in-number-of-students-accepting-university-places.html
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Greece’s Youth Jobless Rate Hits 65 Percent, As The Country’s Downward Spiral Continues Unchecked
The UK Telegraph‘s Ambrose Evans-Pritchard has written:
See http://www.telegraph.co.uk/finance/financialcrisis/10231989/Greece-becoming-new-Kosovo-as-youth-jobless-hits-65pc.html
There is no question that the economic tsunami continues its relentless and unforgiving advance globally.
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At least under the Bretton Woods Agreement of 1945, the industrialized nations had some semblance of monetary order by maintaining currency exchange rates with the primary currency; the US dollar. With the exchange of the dollar into “real” currency (gold), along with foreign currency exchange rates linked to the dollar, the industrialized nations were limited as to how much currency they could create in their own countries. Bretton Woods, although not perfect, worked well enough until Nixon did the unthinkable; he closed the gold convertability window in 1971, whereby removing the dollar from its link to gold. The world thereby entered into the era of fiat currencies, which enabled individual nations to devalue their currencies virtually at will, which allowed for politicians to provide popular social programs for their people (much of it paid for via fiat printing press and the hidden tax; inflation). Doing away with Bretton Woods also allowed the world’s central bankers free reign in running the nations’ economies. Bubbles, busts, booms, deflation, inflation, recessions, depressions, etc. could all be “created” by the central bankers’ monetary policies.
Regarding Greece, it was an economic basket case prior to entering the EU, with interest rates running at 18% + due to the nature of risk. By entering the EU, Greece experienced an ARTIFICIAL boom due entirely to the sudden availability of capital at much lower interest rates via the EU. The availability of cheap money did not change the unsustainable spending habits of the Greek people. It also allowed the already bloated public sector to do what they do best … expand.
Greece is the poster child for the credit bubble that was created entirely by fiat money, lax lending, and artificially low interest rates. Artificial economic expansion, especially when done on a massive scale as it was done in Greece, always leads to disaster.
I doubt America will learn from Greece (or Italy, France, Portugal, Ireland, Great Britain, Japan, etc.). Years and years of political rhetoric have addressed the similar problems that many see on America’s economic horizon. With all the problems facing America, what are we getting from our “leaders” in Washington? Personally, I am hearing (from both parties) a lot of political rhetoric, with very little (if any) substance behind it. I have been observing this scenario for over 30 years and have long ago concluded that we are on our own path to an economic Tsunami. If anyone out there thinks there are viable reasons as to how we will avoid economic disaster, I would very much like to hear them.
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Thank you, Ray, for your latest observations and comments. They are appreciated.
You have written:
I would modify this ever so slightly:
Few if any national politicians have economic training; and Barack Obama has none. They pander to the masses, which is the essence of their survival and being. The central problem is that economic forces have been unleashed—which I refer to as a “tsunami”—that have been building. As I wrote more than four years ago in an earlier article entitled, “Euphoria or the Obama Depression?”:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html
Today’s RealClearPolitics Poll Averages show that 51.1 percent of Americans “Disapprove” of Barack Obama’s job performance; 61.8 percent believe that America is on the “Wrong Track”; and 75.8 percent “Disapprove” of Congress’ job performance.
See also http://www.gallup.com/poll/163985/obama-economic-approval-slips.aspx?utm_source=alert&utm_medium=email&utm_campaign=syndication&utm_content=morelink&utm_term=Presidential%20Job%20Approval (Gallup: “Obama’s Economic Approval Slips to 35% . . . decline mirrors drop in overall approval”)
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Europe Will Remain Economically Depressed And Crisis Ridden For A Long Time To Come
This is the conclusion of Jeremy Warner, Assistant Editor of the UK’s Telegraph:
See http://www.telegraph.co.uk/finance/comment/jeremy-warner/10238631/So-you-think-Europes-debt-crisis-is-finally-over-Time-to-think-again.html (emphasis added); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2751 (Obama’s approval ratings plummet) and http://nyc.podcast.play.it/media/d0/d0/d1/d3/dH/d7/dR/13H7R_4.MP3 (Dick Morris with economist James Fitzgibbon: “The Coming Crash”)
Hold on tight. The worst is yet to come globally, during the balance of this decade!
While the United States will fare better than other countries, the effects here will be nothing short of devastating.
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Greece Won’t Recover . . .
The complete quotation from a fascinating article in the UK’s Telegraph by Daniel Hannan—entitled “Greece is starting to look like Weimar Germany”—is:
See http://blogs.telegraph.co.uk/news/danielhannan/100238597/greece-is-looking-like-weimar-germany/
The article states:
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If U.S. Government Shutdown or Debt Ceiling Causes An Economic Crisis, It’s On The President’s Head
This is the opinion of American investigative journalist, non-fiction author, and the Washington Post‘s Watergate guru, Bob Woodward:
See http://freebeacon.com/woodward-if-shutdown-or-debt-ceiling-causes-economic-crisis-its-on-the-presidents-head/ (emphasis added); see also http://blogs.telegraph.co.uk/news/concoughlin/100238900/us-government-shutdown-barack-obama-is-presiding-over-the-end-of-americas-superpower-status/ (“[T]he shut down represents yet a further blow to the prestige of the Obama administration at a time when it is still reeling from its inept handling of the recent Syrian crisis. . . . [T]he longer the Obama presidency continues, the more America’s status as a superpower ebbs away“) and http://www.nationaljournal.com/politics/the-beginning-of-the-end-for-washington-20131001 (“While announcing historic negotiations with Iran, a regime that sponsors terrorism, Obama said he wouldn’t bargain with the GOP”)
I have spent most of my legal career working in or with government, including years spent at the Pentagon and on Capitol Hill.
I am neither a Republican nor a Democrat. I have been an Independent for more than 20 years, after first being a Democrat and then a Republican.
If there are any lessons that I have learned, it is that government does not work; and the government that governs least, governs best.
America’s governments—at the federal, State, and local levels—are grossly inefficient. Dealing with these governments is like dealing with some Third World “banana republic” . . . with the exceptions of the Pentagon and our military, which on balance are the best of American government.
This is why more and more Americans have such a low opinion of government, and do not trust it. When Obamacare gets into full swing, assuming that it does, the wrath of the American people may know no bounds; and Obama and his Democrats may pay a very heavy political price!
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The Global Warming Hoax, And The Great Green Con, Revisited [UPDATED]
As discussed above, so-called man-made “global warming” is a myth, like the “Tooth Fairy” and the “Loch Ness Monster.”
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1127 (“The Lunacy Of The Global Warming Hoax Is In Full Swing“); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7356 (“The Global Green Energy Fad”)
Our planet goes through natural cycles, of warming and cooling. It always has.
The Wall Street Journal has added to the debate, in an article entitled “Climate of Uncertainty”:
See http://online.wsj.com/article/SB10001424052702304713704579092883286839894.html?mod=WSJ_hps_sections_opinion; see also http://blogs.telegraph.co.uk/news/jamesdelingpole/100248380/extreme-weather-events-are-increasing-yet-another-green-propaganda-myth/ (“Extreme weather events are increasing: yet another green propaganda myth . . . [C}limate alarmists threw all moral compunction or intellectual integrity out of the window long ago“) and http://nypost.com/2013/12/05/global-warming-proof-is-evaporating/ (“Global-warming ‘proof’ is evaporating”) and http://dailycaller.com/2013/12/13/study-earth-was-warmer-in-roman-medieval-times/ (“Study: Earth was warmer in Roman, Medieval times“) and http://newsbusters.org/blogs/pj-gladnick/2013/12/28/msm-glosses-over-irony-global-warming-scientists-trapped-antarctic-ice#ixzz2ovITxKYv (“Global Warming Scientists Trapped in Antarctic Ice“) and http://www.cbc.ca/news/canada/manitoba/winnipeg-deep-freeze-as-cold-as-uninhabited-planet-1.2479967 (“Winnipeg’s temperature as cold as surface of Mars“) and http://apnews.myway.com/article/20140104/DAB3UT982.html (“Historic freeze could break Midwest temp records“) and http://www.dailymail.co.uk/news/article-2533458/Flood-Hercules-grip-Northeast-Canada-records-temperatures-cold-MARS.html (“After the snow… a ‘polar vortex’: Nation braces for the coldest temperatures in 40 YEARS after blizzards grounded 5,000 flights“) and http://www.dailymail.co.uk/news/article-2545153/U-S-braces-coldest-month-century.html (“U.S braces itself for coldest month of the century with yet another Arctic blast as fears grow for Super Bowl Sunday“) and http://www.washingtonpost.com/opinions/charles-krauthammer-thought-police-on-patrol/2014/04/10/2608a8b2-c0df-11e3-b195-dd0c1174052c_story.html (“[T]he left is entering a new phase of ideological agitation—no longer trying to win the [global warming] debate but stopping debate altogether, banishing from public discourse any and all opposition. The proper word for that attitude is totalitarian”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3036 (“The scandal of fiddled global warming data”—”The US has actually been cooling since the Thirties, the hottest decade on record”) and http://online.wsj.com/articles/judith-curry-the-global-warming-statistical-meltdown-1412901060?mod=hp_opinion (“The Global Warming Statistical Meltdown“) and http://www.telegraph.co.uk/news/earth/environment/globalwarming/11395516/The-fiddling-with-temperature-data-is-the-biggest-science-scandal-ever.html (“The fiddling with temperature data is the biggest science scandal ever”) and http://www.foxnews.com/science/2013/01/10/hottest-year-ever-skeptics-question-revisions-to-climate-data/ (“‘In the business and trading world, people go to jail for such manipulations of data’”) and http://www.wsj.com/articles/richard-s-lindzen-the-political-assault-on-climate-skeptics-1425513033 (“The Political Assault on Climate Skeptics”—”global warming hysteria”-“[T]he case for climate alarm is disintegrating”) and http://www.japantimes.co.jp/news/2015/05/08/asia-pacific/politics-diplomacy-asia-pacific/australia-pm-advisor-says-climate-change-u-n-led-ruse-create-new-world-order/#.VU0K3TfS_O8 (“Australia PM advisor says climate change a U.N.-led ruse to create new world order”) and http://www.wsj.com/articles/the-unsettling-anti-science-certitude-on-global-warming-1438300982 (“The Unsettling, Anti-Science Certitude on Global Warming”—”If anthropogenic climate change is a reality, then that would be a huge problem only government could deal with. It would be a heaven-sent opportunity for the left to vastly increase government control over the economy and the personal lives of citizens”)
. . .
Man-made “global warming” is a hoax, and “The Great Green Con.”
Like Obamacare, it is simply another Leftist attempt to control people and their lives, and a path toward global government.
See https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3119 (“Obamacare Laid Bare: Barack Obama’s Big Lie”)
In another time, the proponents of “global warming” would have been members of the “Flat Earth Society,” and claimed a “consensus” with respect to that too.
. . .
It has been written:
See http://politix.topix.com/stmt/BFOQEPFDMVQ1S7RD?replyid=SQQDBUFVMK0A4BQ5; see also http://www.climatedepot.com/2014/09/27/noaa-1695-low-max-records-broken-or-tied-from-sept-11-to-sept-20-one-record-broken-by-25f/ (“NOAA: 1695 Low Max Records Broken or Tied From Sept 11 to Sept 20. One record broken by 25F“) and http://www.wcvb.com/weather/snow-sets-historic-records-in-boston/31168556 (“Snow sets historic records in Boston“) and http://www.weather.com/storms/winter/news/arctic-coldest-this-winter-season-northeast (100 MILLION AMERICANS FACE BITTER COLD, CHILL MAP) and http://news.yahoo.com/boston-breaks-seasonal-snowfall-record-108-6-inches-232218057.html (“Boston breaks seasonal snowfall record with 108.6 inches“) and http://www.dailymail.co.uk/sciencetech/article-3156594/Is-mini-ICE-AGE-way-Scientists-warn-sun-sleep-2020-cause-temperatures-plummet.html (“Is a mini ICE AGE on the way? Scientists warn the sun will ‘go to sleep’ in 2030 and could cause temperatures to plummet”) and http://www.nytimes.com/reuters/2015/10/29/world/europe/29reuters-climatechange-summit-russia-media.html?_r=0 (“The president [Putin] believes that ‘there is no global warming, that this is a fraud to restrain the industrial development of several countries including Russia’“) and http://www.express.co.uk/news/science/616937/GLOBAL-COOLING-Decade-long-ice-age-predicted-as-sun-hibernates (“GLOBAL COOLING: Decade long ice age predicted as sun ‘hibernates'”) and http://www.express.co.uk/news/nature/617144/Antarctica-not-shrinking-growing-ice-caps-melting (“MELTDOWN MYTH: Antarctic ice growing is just the first EVIDENCE global warming is NOT REAL“)
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Barack Obama’s Welfare Socialism Sparked The US Government Shutdown, Not The American Constitution
This is the opinion of Dr. Tim Stanley, a historian of the United States, writing in the UK’s Telegraph:
See http://blogs.telegraph.co.uk/news/timstanley/100239347/us-government-shutdown-obamas-welfare-socialism-sparked-this-crisis-not-the-constitution/ (emphasis added)
Having worked on Capitol Hill and with government all of my legal career, it is nice to find an article that tells the truth. Tim Stanley is correct.
The only thing that I question are his statements:
Even here, the “game of chicken” may proceed; and the scare tactics and “climate of fear” spread by Obama and his far-Left Liberals may fall on deaf ears and be farfetched.
Shut down the government: it has happened, and few Americans are losing any sleep over it. The same thing may be true about a failure to raise the debt ceiling. Obama’s “Chicken Little-The Sky is Falling” approach is not working, inter alia, because Americans just witnessed his humiliating Syrian debacle.
See, e.g., https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-2907 (“Obama’s Epic Incompetence”); see also https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3079 (“[Moody’s] says that the U.S. Treasury Department is likely to continue paying interest on the government’s debt even if Congress fails to lift the limit on borrowing“)
. . .
Also, any notion that the U.S. will lose its borrowing ability is utter nonsense. In borrowing money (e.g., for a large real estate project), it is always desirable to be the largest debtor of a small bank. Indeed, it is often said that the borrower “owns” the bank, because the borrower’s default can take down the bank.
The same thing applies to China, for example. If American purchases from China were to collapse, China would collapse economically. The Chinese leadership has to do business with us, and play ball with us, or suffer the consequences. “Devious” though they may be, they are not stupid.
See also https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/#comment-2251 (“China’s Hard Landing”)
. . .
Americans detest government, and rightly so. It is an integral part of the American psyche today. Barack Obama keeps emitting scare tactics; and we are getting very used to them, like the “Boy Who Cried Wolf” over and over again.
Of much greater concern to the American people on a daily basis is the damage that Obamacare may do to their health.
As Stanley notes correctly, Barack Obama and his Democrats are to blame. Even before the latest crisis, Obama had used his “Sequestration” to drastically cut our military, and even cut off White House tours:
See http://www.whitehouse.gov/about/tours-and-events; see also http://www.breitbart.com/Big-Government/2013/10/02/Obama-Administration-Decided-to-Block-Access-to-Memorials (“OBAMA ADMINISTRATION DECIDED TO BLOCK ACCESS TO MEMORIALS“) and http://freebeacon.com/shutdown-theater/ (“[Obama Administration] Orders Closure of Park that Receives No Federal Funding“) and http://www.washingtontimes.com/news/2013/oct/2/doves-and-peaceniks-no-more-these-democrats-relish/ (“Democrats relish the role of bullies“) and http://dailycaller.com/2013/10/03/need-health-care-coverage-just-dial-1-800-fuckyo-to-reach-obamacares-national-hotline/ (“Need health care coverage? Just dial 1-800-FUCKYO to reach Obamacare’s national hotline“) and http://washingtonexaminer.com/military-keeps-camp-david-open-halts-nfl-baseball-coverage-to-troops-overseas/article/2536819 (Obama cuts NFL, baseball coverage to troops overseas) and http://www.weeklystandard.com/blogs/nbc-police-remove-vietnam-war-veterans-memorial-wall_759267.html (“Police Remove Vietnam War Veterans at Memorial Wall“) and http://www.breitbart.com/Big-Government/2013/10/05/Feds-Try-to-Close-the-OCEAN-Because-of-Shutdown (“FEDS TRY TO CLOSE THE OCEAN BECAUSE OF SHUTDOWN“) and http://www.foxnews.com/politics/2013/10/08/fox-news-poll-majority-would-vote-against-raising-debt-ceiling/ (“If it were up to the American public, they would vote no [on raising the nation’s debt limit so the federal government can borrow more money]—with a majority saying the debt limit should only be raised after major spending cuts have been made“) and http://weaselzippers.us/2013/10/09/gross-u-s-taxpayers-shelled-out-634320919-to-build-obamacare-website/ (“U.S. Taxpayers Shelled Out $634,320,919 To Build Obamacare Website“) and http://www.washingtontimes.com/news/2013/oct/9/obamas-national-debt-rate-on-track-to-double/ (U.S. DEBT DOUBLES SINCE OBAMA…) and http://washington.cbslocal.com/2013/10/15/palin-defaulting-on-our-national-debt-is-an-impeachable-offense/ (“[W]e don’t have enough money to continue to finance our ever-growing federal government (with our $17 trillion dollar national debt that has increased over 50% since Obama took office). . . . That’s why President Obama wants to increase the debt limit”)
Obama never set foot on the American mainland until he attended Occidental College in Los Angeles. Instead, he grew up in Hawaii and Indonesia. His views are out of touch with most Americans who were born and raised here.
He is a Narcissist, a demagogue, a liar and incompetent; and his reelection in 2012 merely elevated and reinforced these qualities in him. Indeed, he has come to believe that he is invincible, politically; and he has set about to change America, much like Richard Nixon did after his landslide reelection victory in 1972.
Obama’s anger and willingness to punish his enemies are on display, each and every day, like Nixon’s anger and willingness to punish his enemies.
If you have any doubts whatsoever about such anger, which has undergirded Obama’s life and still does, read (or reread) his book “Dreams from My Father.” It is all there, in his own words.
See https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/; see also http://blogs.telegraph.co.uk/news/timstanley/100240627/barack-obamas-leviathan-even-when-the-us-government-is-shutdown-its-still-too-big/ (“[The Obama Administration] is engaging in high profile acts in an effort to exaggerate the impact of the shutdown”) and https://naegeleblog.wordpress.com/2010/07/30/illegal-immigration-the-solution-is-simple/#comment-3100 (“Immigration Reform Must Be Blocked Forever“) and http://wfpl.org/post/mcconnell-reid-deal-includes-2-billion-earmark-kentucky-project (“McConnell-Reid Deal Includes $2 Billion Earmark for Kentucky Project“)
. . .
Obamacare—the signature and arguably the only “accomplishment” of the Obama presidency—will be hung around Barack Obama’s neck like a dead albatross, politically. It is merely a function of time before this happens.
America’s founders must be weeping . . .
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Obama Lies and Lies Again
The Washington Post has reported:
See http://www.washingtonpost.com/blogs/post-politics-live/liveblog/live-updates-the-shutdown-4/?id=c1e3ada3-dc00-41d8-92cb-327c5c814d82
Tragically, lying seems to undergird Barack Obama’s character. How can Americans and those abroad believe a word that he says anymore?
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Interesting article and spot on. I do believe Americans are seeing the false scare tactics as well as his inability to stand behind his word. The Syrian debacle demonstrated to the world his weakness and more importantly his inability to follow through. We see that as well in the failed execution of Obamacare.
However, as bad as it is, we can only hope Republicans provide some leadership going forward. Right now, there is a struggle between the establishment and the conservatives. I believe the conservatives are on the right track. America wants fighters in their politicians.
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Thank you, Mary Jo, for your comments.
With respect to your first paragraph, the anger is likely to build as more and more Americans experience the full effects of Obamacare, and how it affects their lives. At some point, their anger may reach a critical mass; and I believe Obama and his Democrats will pay dearly, politically.
I agree completely with your second paragraph. We are just beginning to see the infighting. Because approximately 35 percent of American voters are Independents—yours truly included—I hope they help shape the debate and its outcome. The Republican “old guard” (e.g., Mitch McConnell, John McCain, Lindsey Graham) are out of touch.
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Walmart Sees Tough And Unpredictable Global Economy—While Cash-Strapped American Women Sell Hair, Breast Milk And Eggs
Reuters has reported:
See http://ca.news.yahoo.com/wal-mart-says-u-government-shutdown-customers-minds-132111163–business.html
. . .
Bloomberg has reported:
See http://www.bloomberg.com/news/2013-10-15/bodies-double-as-cash-machines-with-u-s-income-lagging-economy.html; see also http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100025932/no-global-recovery-yet/ (“We continue to be in a contained global depression, punctuated by bursts of weak growth that peter out“) and https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/ (“Poverty In America“) and https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3109 (“More and more Americans are losing faith in their government“) and https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3119 (“Obamacare Laid Bare: Barack Obama’s Big Lie“)
. . .
Hold on tight. The worst is yet to come, between now and the end of this decade!
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China’s Impossible Contradiction
This is the title of an article by Ambrose Evans-Pritchard, the UK Telegraph‘s International Business Editor, which observes:
See http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100025957/chinas-impossible-contradiction/ (emphasis added); see also http://www.scmp.com/news/china/article/1341444/xi-jinping-appears-poised-unveil-sweeping-economic-changes?%20utm_source (“Xi Jinping appears poised to unveil sweeping economic changes”)
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The Outsiders Who Saw Our Economic Future
In both America’s energy transformation and the financial crisis, it took a group of amateurs to see what was coming. This is the conclusion of a Wall Street Journal article, which states:
See http://online.wsj.com/news/articles/SB10001424052702303618904579169513659659306?tesla=y
Many of us felt that Alan Greenspan was a fool. Indeed, the former Federal Reserve Chairman was the architect of the enormous economic “bubble” that burst globally. No longer is he revered as a “potentate.” His reputation is in tatters. Giulio Tremonti, Italy’s Minister of Economy and Finance, probably said it best:
That speaks volumes.
See http://www.americanbanker.com/issues/173_212/-365185-1.html (“Greenspan’s Fingerprints All Over Enduring Mess”)
Many of us have believed that even worse would transpire during Barack Obama’s presidency, inter alia, because he is a black racist, a feckless naïf, and a tragic Shakespearean figure whose naïveté has been matched by his overarching narcissism, and he is more starry-eyed and “dangerous” than Jimmy Carter.
See https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/ and http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html (“Euphoria or the Obama Depression?”) and http://seekingalpha.com/instablog/2951-market-shadows/31177-interview-with-timothy-d-naegele (“Interview with Timothy D. Naegele”)
All of this is proving true; for example, as Obamacare fails—which affects one-sixth of the U.S. economy, as well as the lives of every American—and as Barack Obama fails in essentially everything that he does.
See, e.g., https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3119 (“Obamacare Laid Bare: Barack Obama’s Big Lie”) and https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3114 (“[Obama] is the laughingstock of America and the world. . . . He makes Bill Clinton and Richard Nixon seem like choir boys, and paragons of honesty and virtue, by comparison”) and https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3125 (“Obama Accused Of Military Purge”) and https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/#comment-3139 (“49.7 Million Americans Living In Poverty”)
During the Great Depression of the last century, there were “green shoots” or signs that things were improving—as we have been witnessing lately. However, in the final analysis, the Depression did not run its course until the end of World War II. This time, the housing market will crumble again and the financial system may collapse, causing human suffering and economic dislocations worldwide.
Clearly, Barack Obama does not have a clue how to deal with this; and the same is true of our Fed and other governmental agencies and politicians around the world. Hold on tight. The worst is yet to come during the balance of this decade. However, it is likely that America will fare better than other countries.
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Obama Accused Of Military Purge
According to Newsmax:
See http://news.newsmax.com/?Z6CRXbSa.P-jo1Uf-WNTn6.Kv3ykxJR1Z&ns_mail_uid=69782&ns_mail_job=1544392_11032013 (emphasis added); see also https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/
None of this is surprising in the least. What began with the sacking of our former military commander in Afghanistan, General Stanley A. McChrystal, is continuing unabated.
Obama’s Sequester was intended, in part, to “gut” our peerless military. His appointment of Chuck Hagel as the Secretary of Defense was intended to put a Republican “hatchet man” at the helm of our military, to execute Obama’s orders.
As I have written:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html (“Euphoria or the Obama Depression?”); see also http://www.gallup.com/poll/113980/Gallup-Daily-Obama-Job-Approval.aspx (GALLUP: OBAMA FALLS TO 30’S [November 5, 2013])
It is time for Obama to stand down!
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America has, unfortunately, already reached the demographic “tipping point” as the re-election of Obama has only confirmed that his first election was no fluke and as Mark Styn wisely commented “Demographics are destiny.”
The wise, conservative senior citizens are dying off by the day, while Hollywood programmed young idiots are entering the voting age. . . . America is quickly ceasing to be a Christian inspired nation and is rapidly becoming a “HOLLYWOOD NATION” . . . a virtual reality of moronic talk shows, borderline pornography, trash movies and Leftist sit cons that shape, seduce and mold the liberal world view and values. . . . What chance has a Church sermon against the latest Hollywood blockbuster and the steady drip, drip, drip of Leftist values?
We in the Western World are clearly on our way to a dystopia, an IDIOCRACY. . . . What we are witnessing is a full blown meltdown of a civilisation a millennium in the making, and the economic crash is just merely symptomatic of a much more serious malaise.
“Those whom the Gods wish to destroy, they first make mad”!
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Thank you for your thoughtful and articulate comments, with which I agree in large part.
Having grown up in Hollywood (i.e., Los Angeles), and then having spent most of my professional career working in and with Washington, D.C.—to this day—I have witnessed the “Hollywoodization” of this country and the world. Hollywood’s “values” have gone global in their reach.
However, if one went back to the Jimmy Carter presidency, one would find similar sentiments and negative forecasts being expressed; and then Ronald Reagan’s presidency began. Obviously, the difference now is that we have a black racist as president, who is a Narcissistic demagogue, and who has none of the patriotism of Carter—and who, until recently, seemed “Teflon-coated.”
See, e.g., https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/
As I have written elsewhere at this blog:
See https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3109 (“When Americans Wallow In Obamacare, Their Anger Will Grow!”)
The anger is building, and it may engulf both Obama and his Democrats.
Also, as I have written:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html (“Euphoria or the Obama Depression?”)
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Unfortunately, comparing Obama to Carter as an example of how things are not too bad and that America can still recover as it did with the election of Reagan is just wishful thinking.
Having been a student of History for all of my adult life, and having lived in the USA for 25 yrs in 9 different States before having to return to my native Britain due to a tax problem with Uncle Sam (how’s that for historical irony?), it has given me a bird’s eye view of things, even if it’s merely the view of a jaunty crow, but crows can be wise and intuitive birds . . . ergo, the America of J Carter is a world away from the America of Obama. . . . “The past is another country. . . .they do things differently there”!
Reagan was a product of another era of Hollywood, a golden age in fact, who rode to the rescue after the calamitous Carter Presidency, but back then America was still a conservative nation, but now things are rapidly changing, partly due to the communications revolution that speeds up events like a video on fast forward.
Lenin was correct, “Cinema is indeed the greatest propaganda device ever created” . . . . If a photo can be worth a thousand words, then what for a series of moving photos on the silver screen for shaping, seducing and molding a viewers perception of the world?
Hollywood was once a force for good, after all, it produced American heroes and shaped the worldview of a generation or more, but not now, NOT NOW!
It now represents the most pernicious aspects of so called “popular culture” that is slowly poisoning, seducing, demoralizing and corrupting impressionable minds, and after all, the future really does belong to the young.
Obama is a fine example, almost a caricature, of the malignancy of the free love 1960’s and is perfectly in tune with the present zeitgeist and the blending of Hollywood and politics into a virtual reality as we in the Western world seem determined to amuse ourselves to death, to block out the hard facts and truths about life and to live for the day in a hedonistic quasi fantasy world of TV, music, sexual debauchery and frivolous entertainment.
We in the post modern UK are even more advanced along this road to ruin and if you Yanks wish to take an eerie glimpse into your future, then here it is . . . the secular nanny state, not Orwell’s “Big Brother,” but more “big mother” because mother really does know best . . . a world of stifling civil restrictions where the all seeing eye of God has been replaced by the CCTV camera 24/7 . . . a world of radical secularism where the religious impulse has been shoehorned/pressganged into secular “sacred causes” such as “saving the planet” and its apocalyptic cult of so called “Global Warming”!
Indeed, utterly ruinous and worthless windturbines are springing up all over the country like “day of the Triffids” and are, in a broader sense, a fine example of a group psychosis in some ways like the madness that must have overcome the folks on Easter Island with their mania for statue building.
Evidently, it all began in the rarefied air of a university, as a neurosis of sorts, among educated idiots lacking practical real life experiences that has now been propagandized to the population as a “crises” . . . meanwhile, with rich irony, the real crises of future economic collapse is being ignored.
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Thank you again. That was a mouthful. 🙂
First, I have only compared Obama to Carter in the sense that both were Liberal presidents who were followed by conservative presidents, just as Richard Nixon followed Lyndon Johnson.
As I have written:
See https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/
Second, I agree that “the America of J Carter is a world away from the America of Obama.” They are light years apart. Obama grew up in Hawaii and Indonesia, and never set foot on the American mainland until he came to Occidental College in Los Angeles. He never served in our military, and is a black racist. Carter is a product of our Naval Academy at Annapolis; and he has sought to heal racial differences, which Obama has exploited. Obama’s core beliefs are racist, and vastly different from those of Carter.
Third, I agree that “Reagan was a product of another era,” but Obamacare and the other failures of Barack Obama are becoming clear to all Americans. They may produce a sea change of American opinions, just as the policies of Lyndon Johnson and Jimmy Carter produced political revulsions.
Fourth, you stated:
Again, I have split my time between Washington, D.C. and Hollywood, so I understand fully what you are saying, and the effects that have taken place.
However, I believe that Americans—including young Americans—are more discerning than you give them credit for being. Hollywood is only one influence. Now, the Internet presents a myriad of choices of important news sources globally for “free.”
See, e.g., http://www.naegele.com/links.html
Fifth, you stated:
I agree with your assessment, but I believe too that Obama will come crashing down from atop “Mount Olympus” in the waning days of his presidency and thereafter.
Sixth, I agree that the UK is farther along the path to “chaos,” and it saddens me.
Seventh, the madness preached by “environmental Nazis”—most notably, the “Global Warming” hoax, otherwise known as the “Great Green Con”—is absurd. However, I believe this too will pass; and yes, I am a hiker and love the environment.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3036 (“The Global Warming Hoax, And The Great Green Con, Revisited”)
Lastly, you said:
With tough economic times ahead, and rising tuition and related costs that produce staggering student debts, colleges and universities may be beyond the reach of most. Also, the Internet is changing the traditional role of “bricks-and-mortar” educational institutions, just as it has consigned newspapers to the “horse-and-buggy” era.
See https://naegeleblog.wordpress.com/2011/07/29/are-colleges-dinosaurs/ (see also the comments beneath the article)
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Personally, I would have to agree with your assessment. At the heart of America’s problem is its moral slide into decay which is self-evident by our culture. I have often thought about the 19th. century historian de Tocqueville’s revealing statement in his classic “Democracy in America” … “The secret to America’s greatness is its goodness; when it ceases to be good, it will cease to be great.” Our modern culture mocks that goodness, and in its place, violence and hedonism rules. If you doubt this, take a little time and do a search regarding the lyrics of “Hip Hop” or “Rap”, etc. Be forewarned: if you are not familiar with “Hip Hop,” etc. you are going to be shocked. Hollywood, TV, the rock culture, magazines, in fact, virtually our entire popular entertainment industry is, by and large, a cesspool of filth. A study of history will reveal that prior to the advent of totalitarian rule, the society’s culture fell into the abyss. America’s cultural slide began in earnest in the 1960’s and has continued to the present. Unfortunately, I don’t see anything on the horizon that indicates that America will dramatically change its current destructive course.
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Thank you, Ray, for your comments as always.
Yes, I agree with all of your statements. I would add, however, that the pendulum swings; and there is a growing revulsion to what you have described.
The Left has used the term “political correctness” to describe what they believe is right or correct, and everyone else’s opinion is wrong. Also, they have used the word “Progressive” to label themselves, when there is absolutely nothing progressive about them.
In their sense of “guilt,” Hollywood and the Left have embraced “degenerate” music and activities, which must be condemned. In a very real sense, Barack Obama is our politically correct, “Progressive,” degenerate president.
Most Americans have never read his book, “Dreams from My Father,” in which he sets forth his core beliefs. The book and his beliefs are shockers, yet this is how he has been governing, and it is a road map to what we may expect from him over the next three years or so.
In my first article that began this blog, I discussed the book in great detail, drawing on his own words, which are cited by page numbers in the article.
See https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/
I tried to be as objective as possible, inter alia, because I almost voted for him. I concluded:
See id.
History and the American people will judge him; and my guess is that the assessment will be harsh, perhaps very harsh.
See, e.g., https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3138 (“Five Years In, Obama And Bush Poll Numbers Nearly Identical”)
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PS…. Back in 1980, the sober minded generation who survived the Great Depression and fought WW2 were still alive and were able to ride to the rescue . . . NOT NOW, as they have entered the pages of History and can only influence us with their words in books or on film. . . . We are indeed in treacherous storm tossed seas with the rocky coastline looming up out of the fog and the frantic alarm bell largely ignored. . . . Meanwhile our enemies in the moslem world, in Russia and in Asia are looking on like grinning opportunistic wolves, not quite fully believing their luck.
Metaphorically speaking, we are, in some ways, like the passengers on the Titanic, overconfident, self assured, listening to ragtime, convinced that the ship is unsinkable, but meanwhile the tip of the iceberg looms up out of the darkness.
In a broader philosophical sense, we humans can survive depravity as growth only comes with struggle and suffering, but we cannot survive too much affluence without becoming hedonistic, lazy minded and debauched. . . . Indeed, the Western World has became a victim of its own affluence.
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Thank you again for your comments.
I agree with your first paragraph.
With respect to your second paragraph, lots of Americans—I believe a majority—have not been lulled into the “ragtime” environment that you suggest. They are sobered by the economic conditions that exist; and as I have stated, Obamacare is in the process of sobering them like never before, and creating anger across the nation, which will only grow.
Regarding your last paragraph, I agree—as I stated above—that hedonism and Atheism are suffocating; however, Man seeks a Higher Power when times are the toughest, and the emptiness of hedonism and Atheism are most apparent.
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I noticed that you were predicting a Romney victory in the last election. . . . With all due respect, you were well out of zeitgeist.
I learned my painful lesson in the previous election when I had complete confidence in the so called “good sense” of the American people that they would never elect a preening poseur like Obama over a true blue patriot like J McCain. . . . Indeed I had such confidence that I bet my life savings on it with INTRADE and then watched in astonishment as Obama was elected.
Four years later as I watched the next election unfold from the vantage point of the UK, it became obvious to me that Obama was going to do it again and he did, EASILY.
Many conservative minded folks live in a bubble of sorts and just fail to see the corrosive effects that liberalism has had on the collective minds of much of the population and that’s why it seems to astonish us that folks like Clinton and Obama can get re-elected.
The Dems have built up a formidable coalition and a truly professional election machine that makes the Reps look like mere clumsy amateurs. . . . They have the tide of history behind them as the Western world is becoming more liberal each year and I truly cannot see the Reps being elected again unless there is a catastrophic economic meltdown, a major war or, God forbid, an act of nuclear terrorism by radical Islam. . . . Only in such a crisis will they win an election.
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Thank you again for your comments.
First, I did predict Romney’s victory, and I voted for him. Many others whose opinions I valued (e.g., Karl Rove, Dick Morris) were predicting a Romney win right up to the last moment. It was a sad day for many Americans when Mitt lost and Obama won; and a day of mourning followed when Obama was sworn in for a second term.
Mitt lost because of four principal factors: (1) lots of “Neanderthal” Republicans stayed home, rather than voting; (2) blacks and Hispanics turned out in record numbers; (3) Obama and his advisors ran a better campaign, and took gambles that paid off (e.g., front-loading their campaign with a costly effort to “define” Mitt right from the beginning); and (4) Hurricane Sandy hit right before the 2012 election, and sucked the air out of Mitt’s momentum—which was helped by New Jersey Republican Governor Chris Christie’s “treachery.”
Second, I voted for John McCain in 2008, but I held my nose in the process of doing so. I am an Independent, and have been for more than 20 years, after first being a Democrat and then a Republican. McCain was to the left of me, but I felt he was better than Obama.
Third, you have said:
I agree with you; however, Obama is no longer “Teflon-coated,” and the wheels may be coming off of his wagon. Today, Gallup reported that he has falling into the 30’s. While this figure may vacillate, my guess is that the trend will be downward, stemming principally because of Obamacare, and more and more Americans become angrier.
Fourth, you said:
I agree with you. Ever since I worked on Capitol Hill, I have believed that the Democrats are much more formidable than the GOP. They play “hard ball,” and take no prisoners. Also, if I wanted to get anything done, I have depended on my Democrat friends in Congress.
Lastly, you said:
Most Americans do not truly care what happens outside of the confines of their “island” (e.g., bounded by the Atlantic and the Pacific). I believe that “a catastrophic economic meltdown” is likely, far worse than we saw in 2008. A major war would only happen if there were “miscalculations.” China and the U.S. are too “entwined” economically.
With respect to an act of nuclear terrorism, I have written about the possibility of an EMP Attack, in which only 30 million Americans might survive. Anything is possible.
See https://naegeleblog.wordpress.com/2010/01/19/emp-attack-only-30-million-americans-survive/</a
I am much more optimistic about the future of the United States than I am, for example, about a united and prosperous Europe. Also, the political pendulum swings in America, unlike other countries.
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The real danger to the US is a nuclear 9/11; as the world becomes more technologically sophisticated, it’s just inevitable that those medieval maniacs will put together a nuclear device of sorts. . . . They have the money from oil revenues, while N Korea is a bankrupt nuclear K Mart, and then there is the corrupt and immoral former states of the Soviet union; it just seems to me to be a matter of time before the “perfect storm” of nuclear terrorism comes together.
The obvious target will be, as ever, New York City, the real capital of America, the capital of the Western World, the capital of capitalism, the very beating heart of the capitalist world and it’s only natural that they would target it. . . . Those religious psychopaths will put together some type of Hiroshima size weapon and put it into a shipping container manned by suicide bombers and then sail into NY harbor. . . . 100,000 dead, 300,0000 injured.
Remember, 9/11 was done on a shoestring of a few tens of thousands of dollars and relatively speaking, a nuclear 9/11 will be too, compared to the apocalyptic damage it will cause.
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Thank you again, for your comments.
First, anything is possible. Whoever thought that planes would be hijacked simultaneously in the U.S., and flown into the World Trade Center and The Pentagon, with another one apparently heading to Washington as well?
Second, such a weapon might come from the former Soviet Union’s arsenal, Pakistan, North Korea, or be configured elsewhere. While NYC might be the target, my guess would be London or some other city, but you may be correct.
Third, my great concern has been the possibility of an EMP Attack, which I have written about.
See https://naegeleblog.wordpress.com/2010/01/19/emp-attack-only-30-million-americans-survive/ (“EMP Attack: Only 30 Million Americans Survive”)
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Mitt Romney never had much of a chance of winning that last election, and the so-called surge was nothing more than spin, hype and wishful thinking.
Obama had 3 times more campaign offices around the country and many thousands of young volunteers, plus most of the media.
A large part of the problem was MITT; he was anachronistic and more suited to the conservative, conformist 50’s and was very easy to caricature and steriotype, whereas Obama was perfectly in tune with the zeitgeist of politics blending and morphing into a Hollywood type virtual reality. . . . He’s the American Idol, for christsake who can even sing and dance. . . . When he leaves office, it wouldn’t surprise me if he has his own talk show on TV.
The most influential woman in America is not Hillary, it’s Oprah, who played a major part in the election of Obama. . . . Those vacuous folks, especially women, who watch the Oprah Winfrey Show are just the types who voted for Obama in large numbers. . . . As such, the DEMS have a critical advantage insomuch that they have the entertainment industry working for them 24/7.
In defense of the movie industry, most of what they turn out is trash, but once in a while they get it right. . . . 12 years a slave is gonna sweep at next year’s Oscars, and so it should as cinema has the ability to educate and reach folks who are not much inclined to read a book.
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Thank you again. 🙂
First, as Obamacare hurts more and more Americans, and as more fall into poverty, Mitt may seem pretty good.
An estimated 49.7 million Americans are living in poverty, and that number may swell before Obama’s presidency ends.
See https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/#comment-3139
Second, any notion that Obama is an “idol” may be fading. Indeed, never discount title of this article: “Is Obama The New Nixon?”
See also https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3138 (“Five Years In, Obama And Bush Poll Numbers Nearly Identical”)
Third, I am not a “fan” of Oprah; and her TV network has had serious financial problems because few people are watching it.
Fourth, every once in a while, a great movie comes along; however, in most cases, they are made overseas (e.g., in your UK).
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The internet and TV are potentially the greatest teaching instruments ever invented, however, they are largely used for recreation purposes such as social networking and light entertainment.
Here in the UK we are much more along the road to the serfdom of the nanny state by being spoon fed syrupy, mawkish half truths and vacuous propaganda; much of the population lack any intellectual curiosity and are happy and content watching moronic game shows, talent shows, sit coms and celebrity confessions. . . . It’s astonishing how lazy minded folks can swallow the party line, hook, line and sinker and the fine example would be the so called crises of Global Warming. . . . It ‘s literally a load of hot air, all in the mind, but to millions of folks it’s the only thing worth worrying about. . . . I cannot help but notice how religious folks are skeptical of it, but it’s hardly surprising as they already have a religious belief.
Our leaders are, ironically, very similar to Obama, not malignant or evil, but just shallow lightweights lacking gravitas and completely out of their depths; indeed the last statesman we had was a woman. . . . It seems that we are indeed suffering a crises of masculinity and are now entering the era of the Western metrosexual half way towards being the full blown homosexual.
. . .
Naturally, our enemies in the moslem world, in Russia and in Asia are none too impressed and see only decadence, debauchery and utter weakness.
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Thank you, as always.
First, I have been on the Web for more than 20 years. When I began, it was described not as an “information highway,” but as a “dirt road.” All of that has changed.
Today, the world’s population is approximately 7,017,846,922, and Internet users are approximately 2,405,518,376—or 35 percent of the population. Wow!
See http://www.internetworldstats.com/stats.htm
The Web is essential to commerce today; and it has been essential to me since I started. I seldom if ever use it for “recreation.”
Second, again I agree with you completely regarding the “global warming” hoax, or the Great Green Con.
Third, I have come to the conclusion that Obama is “evil.” Please read (or reread) my article, based on his book “Dreams from My Father.” It is all there—in his own words—his black racism and how he has been governing, and what we can expect over the next three years or so.
See https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/
In a sense, he and his Democrats are throwbacks to George Orwell’s “Animal Farm.”
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49.7 Million Americans Living In Poverty
AP News has reported:
See http://hosted.ap.org/dynamic/stories/U/US_CENSUS_POVERTY?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2013-11-06-13-38-44; see also http://newyork.cbslocal.com/2013/11/10/nyc-food-bank-head-40-of-veterans-need-food-assistance/ (“40% Of Veterans Need Food Assistance“) and http://dailycaller.com/2013/11/11/record-high-91-5-million-people-not-included-in-labor-force/ (Record 91.5 million Americans not in labor force) and http://www.nytimes.com/projects/2013/invisible-child/?smid=tw-nytimes#/?chapt=1 (NYC has highest number of homeless children since Great Depression)
Obamacare will increase these numbers dramatically!
See https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3119 (“Obamacare Laid Bare: Barack Obama’s Big Lie”) and https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3138 (“Five Years In, Obama And Bush Poll Numbers Nearly Identical”)
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Fed Is Creating The Mother of All Bubbles
This is the opinion of David Stockman, director of the Office of Management and Budget (OMB) under President Reagan, and veteran investor and financial author Jim Rogers:
See http://www.moneynews.com/Economy/Stockman-Fed-bubble-Rogers/2013/11/08/id/535617 (emphasis added); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3176 (“The Higher Home Prices Rise, The Farther They Will Fall When The Bubble Bursts“) and http://www.moneynews.com/InvestingAnalysis/Blodget-stocks-crash-overvalued/2013/12/26/id/543813?ns_mail_uid=69782&ns_mail_job=1551282_12262013&promo_code=160F9-1 (“Stocks Are at Least 40 Overvalued“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3303 (“The End Of Quantitative Easing“)
AMEN!
When the bubbles burst this time, 2008 may seem like child’s play; and the number of Americans in poverty will climb dramatically, as it did during the Great Depression of the last century.
See https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/#comment-3139 (“49.7 Million Americans Living In Poverty”)
Hold on tight. Things will get very ugly and scary between now and the end of this decade!
. . .
Also, let us never forget the role of former Fed Chairman Alan Greenspan, who was the architect of the enormous economic “bubble” that burst globally. No longer is he revered as a “potentate.” His reputation is in tatters. Giulio Tremonti, Italy’s Minister of Economy and Finance, probably said it best:
That speaks volumes.
See http://www.americanbanker.com/issues/173_212/-365185-1.html (“Greenspan’s Fingerprints All Over Enduring Mess”); see also http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html (“Euphoria or the Obama Depression?”)
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The Higher Home Prices Rise, The Farther They Will Fall When The Bubble Bursts
This is the conclusion of Nouriel Roubini, a professor at NYU’s Stern School of Business and Chairman of Roubini Global Economics:
See http://www.project-syndicate.org/print/nouriel-roubini-warns-that-policymmakers-are-powerless-to-rein-in-frothy-housing-markets-around-the-world (“Back to Housing Bubbles“) (emphasis added); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3150 (“Fed Is Creating The Mother of All Bubbles“)
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Barack Obama Is Gutting Our Military Forces, Which Will Affect Our National Security For Decades To Come
As I wrote more than four years ago:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html (“Euphoria or the Obama Depression?”); see also https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3125 (“Obama Accused Of Military Purge”)
John Lehman, who was secretary of the Navy in the Reagan administration and a member of the 9/11 Commission, has written in the Wall Street Journal:
See http://online.wsj.com/news/articles/SB10001424052702303562904579227842506498188 (“More Bureaucrats, Fewer Jets and Ships”) (emphasis added)
I respectfully disagree with Lehman. Obama and Hagel seek to gut our military, not make it more efficient. The Pentagon has always been bureaucratic. In fact, it is the only portion of American government that functions effectively and relatively efficiently. It must be strengthened; and we must stop Obama’s unilateral disarmament.
Obamacare is destroying our national health care system—or one-sixth of the American economy. Obama must not be allowed to destroy the U.S. military. Our very survival depends on it!
See, e.g., https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3156 (“Why Liberals Are Panicked About Obamacare”); see also https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/ (“China Is America’s Enemy: Make No Mistake About That”) and https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/ (“Russia’s Putin Is A Killer”) and https://naegeleblog.wordpress.com/2010/12/22/the-next-major-war-korea-again/ (“The Next Major War: Korea Again?”) (see also the comments beneath the articles)
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Autos: Barack Obama’s Fuel-Economy Schemes Are Likely To Be Rolled Back After He Leaves Office
This is the conclusion of the Wall Street Journal‘s Holman W. Jenkins, Jr. in an article entitled, “The U.S. Bailout of Fiat”—and subtitled, “How a troubled Italian auto maker became a beneficiary of Obama’s zany fuel-economy targets”—which states:
See http://online.wsj.com/news/articles/SB10001424052702304014504579250242537507118?mg=reno64-wsj (emphasis added)
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Exporting American Oil [UPDATED]
This is the title of a Wall Street Journal editorial, which states:
See http://online.wsj.com/news/articles/SB10001424052702304403804579260510587353116 (emphasis added); see also http://www.nytimes.com/2014/03/06/world/europe/us-seeks-to-reduce-ukraines-reliance-on-russia-for-natural-gas.html (“U.S. Hopes Boom in Natural Gas Can Curb Putin“) and http://online.wsj.com/news/articles/SB10001424052702304020104579429443894406788?mg=reno64-wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB10001424052702304020104579429443894406788.html&fpid=2,7,121,122,201,401,641,1009 (“West Tries to Loosen Russia’s Gas Grip“) and http://online.wsj.com/articles/u-s-ruling-would-allow-first-shipments-of-unrefined-oil-overseas-1403644494?mod=WSJ_hp_LEFTTopStories (“U.S. Ruling Loosens Four-Decade Ban On Oil Exports“) and http://www.bloomberg.com/news/2014-07-04/u-s-seen-as-biggest-oil-producer-after-overtaking-saudi.html (“U.S. Seen as Biggest Oil Producer After Overtaking Saudi Arabia“) and http://www.ft.com/cms/s/0/98104974-47e4-11e4-be7b-00144feab7de.html#axzz3EpNIgq1h (“US poised to become world’s leading liquid petroleum producer“) and http://online.wsj.com/articles/mark-p-mills-the-oil-price-swoon-wont-stop-the-shale-boom-1414106473 (“The Oil Price Swoon Won’t Stop the Shale Boom”—”the current slump sets the stage for . . . America’s shale boom 2.0”)
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What Was 2013’s Most Significant Story?
The dramatic failure of Obamacare is the biggest story, because it foretells the end of the Obama presidency—as the myth of Barack Obama collapses before the eyes of the world.
See, e.g., https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3231 (“Americans Finally Wake Up To Who Barack Obama Really Is“)
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$60 Oil Will Finish Russia’s Brutal Putin Regime
The UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, has written:
See http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100026424/60-oil-will-finish-russias-putin-regime-says-hermitages-browder/; see also http://en.wikipedia.org/wiki/Magnitsky_Act (“Magnitsky Act”)
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California Is Lazarus Of Bethany Rising From The Dead, Thanks To Jerry Brown
In an article entitled “The recovery”—and subtitled, “California has won breathing space under Jerry Brown. Now he should tackle taxes, debt and red tape”—the UK’s Economist has noted:
See http://www.economist.com/news/leaders/21595005-california-has-won-breathing-space-under-jerry-brown-now-he-should-tackle-taxes-debt-and-red (emphasis added)
The problem with California has been government, pure and simple. It is a microcosm of the United States and the effects of big governments—which Europe should understand in spades. They are wasteful and all controlling; and Americans are waking up to the fact that government is the problem, not to the solution to most issues. The less government, the better.
In a very real sense, California is a country unto itself. Its GDP is larger than all but eight countries in dollar terms: the United States, China, Japan, Germany, France, Brazil, the UK, and Italy. Its GDP is larger than those of Russia, India, Canada, Australia, and Spain.
It is the most populous State, home to one out of eight Americans. Its natural beauty is unsurpassed; and its weather is unbeatable. Put succinctly, California has everything—and it is home to Hollywood and Silicon Valley.
Brown is a very seasoned politician. I served as a special consultant to his first administration, regarding banking and financial institution matters. He has matured a great deal since then; and Californians are fortunate to have such a “pro” as Governor again.
He understands where the “bodies are buried” in California politics like no other politician. Having served as the Mayor of Oakland, as the State’s Attorney General, and now as Governor for a second time, there is no one who can touch him politically in terms of experience and contacts.
Perhaps Brown will tackle the three problem areas outlined in the Economist article during his next term, assuming he runs for reelection again.
However, the biggest problems for California will emerge (1) when Brown leaves office, and the floodgates of big government are open wide again; and (2) when America’s economic fortunes turn sour between now and the end of this decade. While he is in office though, his fiscal constraints will serve the State and Californians well.
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The End Of Quantitative Easing
An editorial in the Wall Street Journal states:
See http://online.wsj.com/news/articles/SB20001424052702304632204579341011308143216 (emphasis added); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2135 (Dorothea Lange’s historical photograph)
As I have written in the American Banker about Bernanke’s predecessor, former Federal Reserve Chairman Alan Greenspan:
See http://www.americanbanker.com/issues/173_212/-365185-1.html (“Viewpoint: Greenspan’s Fingerprints All Over Enduring Mess”)
Will Bernanke’s legacy be much different? Only time will tell. However, it may be much worse than that of Greenspan, with the passage of time.
Hold on tight. Things may get very ugly and scary. The Fed has been creating “The Mother of All Bubbles.” When it bursts—which it will—2008 may seem like child’s play, and a full-blown depression may emerge.
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3150 (“Fed Is Creating The Mother of All Bubbles“); see also http://www.cnsnews.com/news/article/ali-meyer/bernanke-leaves-fed-record-balance-sheet-4102138000000 (“Bernanke Leaves Fed with Record Balance Sheet of $4,102,138,000,000“) and http://www.marketwatch.com/story/scary-1929-market-chart-gains-traction-2014-02-11 (“There are eerie parallels between the stock market’s recent behavior and how it behaved right before the 1929 crash“)
. . .
What will happen with the stock market? One thing is certain: it is a “fool’s paradise,” especially for novices.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1464 (“Bernie Madoff: The Market Is A Whole Rigged Job, And There’s No Chance That Investors Have In This Market“)
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The EU Is Animal Farm In Europe: Authoritarian Lawlessness!
The EU was a mistake; and it was destined not to flourish.
It has become a bureaucratic nightmare, seeking more and more power (e.g., such as its own military), and stretching its tentacles far and wide—in an attempt to strangle everything in its path, and to grotesquely accrete more power and control.
See, e.g., http://www.telegraph.co.uk/finance/personalfinance/10624818/EU-to-force-Britons-to-publish-details-of-wills-and-property.html (“EU to force Britons to publish details of wills and property“) and http://online.wsj.com/news/articles/SB10001424052702303874504579377052129964162?mg=reno64-wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB10001424052702303874504579377052129964162.html&fpid=2,7,121,122,201,401,641,1009 (“EU Pushes to Globalize Internet Governance“)
In a very real sense, it is George Orwell’s “Animal Farm”: Authoritarian Lawlessness!
In the beginning of Orwell’s classic novel, all of the animals were equal. However, as things evolved, the pigs became supreme; and they dictated to the other animals—because they considered themselves wiser and superior.
This describes the EU’s bureaucrats. It is government gone berserk!
Barack Obama and his administration are similar, but the American people have had their fill of him already.
See, e.g., https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3174 (“Animal Farm In America: Authoritarian Lawlessness!”) and https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3231 (“Americans Finally Wake Up To Who Barack Obama Really Is”) (see also the article itself, as well as the other comments beneath it)
The idea that the EU would become the “United States of Europe” was a fantasy and flawed. At best, the EU is a loose confederation of independent countries, which the EU bureaucrats seek to eliminate.
When economic problems increase, which they will—it is only a function of time—things will get very ugly in Europe!
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3303 (“The End Of Quantitative Easing”); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2756 (“Europe Will Remain Economically Depressed And Crisis Ridden For A Long Time To Come”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2637 (“The Wheels Are Coming Off The Whole Of Southern Europe”) and https://naegeleblog.wordpress.com/2010/05/16/will-the-eus-collapse-push-the-world-deeper-into-the-great-depression-ii/ (“Will The EU’s Collapse Push The World Deeper Into The Great Depression II?”)
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World Asleep As China Tightens Deflationary Vise
The UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, has written:
See http://www.telegraph.co.uk/finance/comment/10634339/World-asleep-as-China-tightens-deflationary-vice.html (emphasis added); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3303 (“The End Of Quantitative Easing“) and https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/#comment-3651 (“US v China: Is This The New Cold War?“)
Hold on tight. Things may get very ugly, globally.
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2014 is shaping up to be a very interesting year indeed. As one considers all the potentially disastrous scenarios, it is difficult to imagine how the global economy will be able to continue to avoid a catastrophe much longer. Hope for the best; prepare for the worst!
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Thank you for your comments as always, Ray.
I agree completely; however, as you know, it is impossible to predict with certainty when things will “break.” I thought it would happen before now, although it seems that a “perfect storm” is forming, which may prove to be more damaging globally than the Great Depression of the last century.
Americans and others around the world are suffering already; however, this is just be beginning. When it breaks, my belief is that housing prices will plummet; and those with cash will be able to “bottom feed.”
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The Eurozone Crisis Is Just Getting Started
This issue has been discussed above already.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3314 (“The EU Is Animal Farm In Europe: Authoritarian Lawlessness!“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3303 (“The End Of Quantitative Easing“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3150 (“Fed Is Creating The Mother of All Bubbles“)
Jeremy Warner has added in the UK’s Telegraph:
See http://uk.finance.yahoo.com/news/eurozone-crisis-just-getting-started-195321069.html (emphasis added)
As I wrote in the first comment cited above—entitled “The EU Is Animal Farm In Europe: Authoritarian Lawlessness!”:
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3314
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New View Into Fed’s Response to Crisis [UPDATED]
According to the Wall Street Journal:
See http://online.wsj.com/news/articles/SB10001424052702303775504579396803024281322 (emphasis added); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3516 (“The Eurozone Crisis Is Just Getting Started“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3496 (“World Asleep As China Tightens Deflationary Vise“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3314 (“The EU Is Animal Farm In Europe: Authoritarian Lawlessness!“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3303 (“The End Of Quantitative Easing“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3176 (“The Higher Home Prices Rise, The Farther They Will Fall When The Bubble Bursts“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3150 (“Fed Is Creating The Mother of All Bubbles“) and https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-4661 (“The Pygmy Putin Rules Over A Third World Country, Russia“) and https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/#comment-4623 (“China’s Speculative Bubble“) http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html (“Euphoria or the Obama Depression?“) and http://www.naegele.com/documents/GreenspansFingerprints.pdf (“Greenspan’s Fingerprints All Over Enduring Mess“)
The New York Times has a different take on these events that is discussed in an article entitled “Fed Misread Fiscal Crisis, Records Show,” which states in pertinent part:
See http://www.nytimes.com/2014/02/22/business/federal-reserve-2008-transcripts.html (emphasis added)
The Fed is the best of America’s financial regulatory agencies, as well as the most respected central bank in the world.
In choosing which agency to administer the Anti-Tying Provision of the Bank Holding Company Act that I wrote when I worked in the United States Senate, I chose the Fed without any hesitation or reservations. I have never changed my opinion in that regard.
See, e.g., http://www.naegele.com/documents/antitying_3.pdf (“The Bank Holding Company Act’s Anti-Tying Provision: 35 Years Later”)
However, the Fed’s Governors are human beings and not infallible. According to Investor Jim Rogers:
“These are not very smart people,” he said of U.S. central bankers such as outgoing Fed chair Ben Bernanke and Janet Yellen. “They are government bureaucrats and they think like government bureaucrats.”
Regardless, they have tried to do their best under very trying circumstances, which are likely to get even worse before the end of this decade.
The Fed has been creating “The Mother of All Bubbles,” as cited above; and when it bursts this time, 2008 may seem like child’s play. The number of Americans in poverty will climb dramatically, as it did during the Great Depression of the last century.
. . .
Ambrose Evans-Pritchard, the UK Telegraph‘s International Business Editor in London, has added:
See http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100026974/bond-yields-to-hit-fresh-lows-as-world-recovery-wilts-growls-saxo-bear/
. . .
Hold on tight. Things will get very ugly and scary between now and the end of this decade!
See also https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-4030 (“Vladimir Putin’s Goals Reach Far Beyond The Crimean Peninsula”) and https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/#comment-3651 (“US v China: Is This The New Cold War?”) and https://naegeleblog.wordpress.com/2010/12/22/the-next-major-war-korea-again/#comment-3225 (“Portrait Of A Butcher: Kim Jong-un Is North Korea’s Stalin”)
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American Leadership Is Missing
The New York Sun has an editorial that is worth reading, entitled “The American Option”:
See http://www.nysun.com/editorials/the-american-option/88603/ (emphasis added)
This is an excellent editorial. However, it flies in the face of everything that Barack Obama is and stands for.
He was raised in Hawaii and Indonesia, and only came to the American mainland when he attended Occidental College in Los Angeles. He does not believe in American exceptionalism. Rather, he believes in “global exceptionalism,” and the notion of a pan-global government, perhaps under the leadership of the United Nations.
See https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/
After World War II, the United States achieved what this editorial is suggesting . . . and much of the world flourished. Obama is going in the opposite direction. He is not the American leader to achieve this. Paul Ryan is not either. After all, he could not even carry his own State for Mitt Romney in 2012.
Ironically, Romney might be the American leader whose beliefs and accomplishments come closest to emulating what this editorial is suggesting.
According to the latest Gallup polling: “Forty-two percent of Americans, on average, identified as political independents in 2013, the highest Gallup has measured since it began conducting interviews by telephone 25 years ago.”
See https://naegeleblog.wordpress.com/2010/03/31/the-rise-of-independents/#comment-3244 (see also the article itself, as well as the other comments beneath it)
Americans are thirsty for the type of leadership that this editorial suggests, but they are not finding it. And there is no question that the revolution in Ukraine presents considerable opportunities; the United States has a dysfunctional system of justice; Obama and his Democrats are waging their campaign to weaken our military; the EU has severe problems; the brutal Putin’s Russia is teetering economically; and China is challenging American leadership globally.
See, e.g., https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-3627 (“Ukraine Is On the Verge Of War And Putin Is To Blame”) and https://naegeleblog.wordpress.com/2013/07/15/justice-and-the-law-do-not-mix/ (“Justice And The Law Do Not Mix”) and https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-3207 (“Barack Obama Is Gutting Our Military Forces, Which Will Affect Our National Security For Decades To Come”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3516 (“The Eurozone Crisis Is Just Getting Started”) and https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-3541 (“How Long Can Killer Putin Figure Skate While The Ice Beneath Him Melts?”) and https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/#comment-3651 (“US v China: Is This The New Cold War?”)
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The Defining Hour For Barack Obama And His Presidency
As discussed in earlier comments: “Does Barack Obama Have Any Guts At All, Or Is He Nothing More Than An Empty Suit?”
See https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-3723
The Wall Street Journal has said essentially the same things, in an editorial entitled “Putin Declares War,” which should be read and reread:
See http://online.wsj.com/news/articles/SB10001424052702304026804579413900968932702 (emphasis added)
This is the defining hour for Barack Obama and his presidency. It is time for him to act . . . NOT slumber or wobble.
It is time for the United States and the West to quit fooling around with Russia’s pygmy Putin, and shut down his country economically.
Putin is presiding over a Russia in decline, which is why he is so desperate with respect to Ukraine. This process of decline must be hastened and “helped” along.
The world is watching . . .
Also, there are reports that China may be supporting Putin’s “adventures” in Ukraine. China has severe economic problems too, and is very vulnerable.
See http://news.sky.com/story/1219922/russia-and-china-in-agreement-over-ukraine (“Russia And China ‘In Agreement’ Over Ukraine”) and https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/#comment-3651 (“US v China: Is This The New Cold War?”)
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RUSSIA AND CHINA PUSH FOR CONTROL OF INTERNET [UPDATED]
Our two major adversaries and/or enemies are trying to step into the breach of American weakness, created by Barack Obama, and control the Internet.
See https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/ and https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/ (see also the comments beneath both articles); but see http://www.wsj.com/articles/u-s-delays-giving-up-oversight-of-internet-administrator-icann-1439851721 (“U.S. Delays Giving Up Oversight of Internet Administrator Icann“) and http://thehill.com/policy/technology/272568-internet-domain-handoff-takes-major-step-forward (“Internet domain handoff takes major step forward“)
Both countries have demonstrated their willingness and ability to manipulate the Internet in their own countries for political and strategic advantages. Imagine the damage they will do to the United States and the West if they control the Internet in any way.
Brendan Sasso has written for the National Journal:
See http://www.nationaljournal.com/tech/when-u-s-steps-back-will-russia-and-china-control-the-internet-20140317 (emphasis added); see also http://www.nationaljournal.com/tech/republicans-fear-obama-will-let-russia-seize-internet-power-20140402 (“Republicans Fear Obama Will Let Russia Seize Internet Power”)
We are on the verge of war with Russia’s dictator-for-life Putin; and China is challenging the United States and our allies in the Pacific. Is there any reason to trust either country?
At a bare minimum, freedom of speech is at stake. Equally at risk are our national security and Internet commerce.
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Decimating Putin: America’s Financial Neutron Bomb
Ambrose Evans-Pritchard of the UK’s Telegraph has written:
See https://uk.finance.yahoo.com/news/us-financial-showdown-russia-more-182452709.html (emphasis added); see also http://www.ft.com/cms/s/0/36e988ea-c576-11e3-89a9-00144feabdc0.html#axzz2zN5oLfMD (“Banks retreat from Moscow deals”) and http://online.wsj.com/news/articles/SB10001424052702303663604579503433988345564 (“What Putin Is Costing Russia”—”Former finance minister Alexi Kudrin projects up to $160 billion in capital will flee this year”) and http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/10791167/BP-and-Shell-exposed-as-US-prepares-first-warning-shot-against-Russias-oil-and-gas-industry.html (“BP and Shell exposed as US prepares first warning shot against Russia’s oil and gas industry”) and http://apnews.myway.com/article/20140505/us-irs-russia-511772f005.html (“US to unleash IRS on Russian banks”) and http://online.wsj.com/news/articles/SB10001424052702304431104579547233042293464 (“European Business Hit By Russian Slowdown”) and and http://www.telegraph.co.uk/finance/financialcrisis/10817511/ECB-capital-flight-from-Russia-has-hit-220bn.html (“ECB: capital flight from Russia has hit $220bn”)
It is time to crush Stalin’s heir, the pygmy Putin, so he never rears his head again; and so democratic forces within Russia can be unleashed—which should have happened before Putin and his cronies and thugs hijacked the country’s incipient democracy. They have been exploiting it ever since, and the Russian people deserve better.
In the process, the various regions should have internationally-supervised referenda to determine which “government” to associate with: vestiges of the crazed despot Putin’s Stalinist regime in Moscow, or regional or other governments. It can start with Chechnya, where the vote to disassociate from Russia may be overwhelming.
All the other alienated regions—and ethnic and religious groups—can hold referenda too, choosing to disassociate from Moscow and perhaps associate with the EU or China, or whomever.
It has been written:
See http://www.ft.com/intl/cms/s/0/3c8495d0-c0ba-11e3-a74d-00144feabdc0.html#comment-7185142; see also https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-4010 (“Putin Must Be Terminated”)
Crimea and Ukraine must become Putin’s abyss, or far far worse. He is a malignancy that must be excoriated. He needs to share the fate of Adolf Hitler and Benito Mussolini, now.
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China’s Speculative Bubble [UPDATED]
In comments above entitled, “World Asleep As China Tightens Deflationary Vise,” what is happening to China’s economy was discussed in depth.
See https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/#comment-3497; see also https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/#comment-3111 (“China’s Impossible Contradiction”) and https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/#comment-2251 (“China’s Hard Landing”)
A new article entitled, “Chinese anatomy of a property boom on its last legs,” by Ambrose Evans-Pritchard—International Business Editor in London of the UK’s Telegraph—sheds further light on this subject:
See http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100027199/chinese-anatomy-of-a-property-boom-on-its-last-legs/ (emphasis added); see also http://online.wsj.com/news/articles/SB10001424052702304811904579587703953556462 (“China’s Property Slump Worsens”)
A sobering prognosis, to say the least.
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The Pygmy Putin Rules Over A Third World Country, Russia
This issue has been discussed before, above; however, an article entitled “Putin’s Hollowed-Out Homeland” by Nicholas Eberstadt in the Wall Street Journal is worth reading:
See http://online.wsj.com/news/articles/SB10001424052702303701304579547672003321680 (emphasis added); see also https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-4452 (“Decimating Putin: America’s Financial Neutron Bomb”) and http://www.telegraph.co.uk/finance/financialcrisis/10817511/ECB-capital-flight-from-Russia-has-hit-220bn.html (“ECB: capital flight from Russia has hit $220bn”)
Russia is little more than a Third World country; and no one or country should be afraid of, or cowed in the least by the pygmy Putin. His days are numbered.
He is desperately trying to forestall his own demise, which is futile; and cling to power.
Dangerous, yes, he may be at the moment. However, it is likely that soon he will join the list of dictators and tyrants before him whose lives ended violently—including Benito Mussolini, Adolf Hitler, Saddam Hussein, Osama bin Laden, and Muammar Gaddafi.
See https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-4467 (“THE END OF PUTIN IS DRAWING NEAR”) and http://www.telegraph.co.uk/finance/economics/10939504/Russias-economic-crisis-deepens-as-EU-readies-fresh-sanctions-over-Ukraine.html (“Russia’s economic crisis deepens as EU readies fresh sanctions over Ukraine”) and http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/10972348/Fed-kicks-off-global-dollar-squeeze-as-Janet-Yellen-turns-hawkish.html (“The outlook for Russia is utterly bleak. It has blundered into a conflict with the West that will smother investment for years. . . . It faces demographic implosion”)
Russia is weak and growing weaker. China may be on the brink of imploding too.
See https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/#comment-4623 (“China’s Speculative Bubble”) (see also the article itself, as well as the other comments beneath it)
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Global Economic Conditions Worsen: Green Shoots Will Disappear [UPDATED]
The article above, and subsequent comments beneath it, have described the deteriorating economic conditions around the world. Years or decades from now, this period in world history may be characterized as the “Great Depression II,” or by other similar nomenclature.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/ (“The Economic Tsunami Continues Its Relentless And Unforgiving Advance Globally”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-4662 (“The Pygmy Putin Rules Over A Third World Country, Russia”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-4625 (“China’s Speculative Bubble”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3648 (“New View Into Fed’s Response to Crisis”) and http://www.telegraph.co.uk/finance/economics/10944874/IMF-warns-of-negative-spiral-in-France-as-recession-looms-again.html (“IMF warns of negative spiral in France as recession looms again”) and http://www.telegraph.co.uk/finance/economics/11047107/Nobel-economists-say-policy-blunders-pushing-Europe-into-depression.html (“Nobel economists say policy blunders pushing Europe into depression”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-6526 (“The End of China’s Economic Miracle”)
In an article entitled, “Global Markets’ Strength Doesn’t Reflect Economic Outlook, Central Banks Say,” the Wall Street Journal notes:
See http://online.wsj.com/articles/global-markets-strength-doesnt-reflect-economic-outlook-central-banks-say-1404037802 (emphasis added); see also http://www.telegraph.co.uk/finance/markets/10965052/Bank-for-International-Settlements-fears-fresh-Lehman-crisis-from-worldwide-debt-surge.html (“The world economy is just as vulnerable to a financial crisis as it was in 2007, with the added danger that debt ratios are now far higher and emerging markets have been drawn into the fire as well, the Bank for International Settlements has warned”—“Overall, it is hard to avoid the sense of a puzzling disconnect between the markets’ buoyancy and underlying economic developments globally”—”BIS officials doubt privately the whether China can avoid a ‘hard landing’, fearing that the extreme credit growth over the last five years must lead to a financial reckoning”) and https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/#comment-5940 (“China’s Leaders Refuse To Blink As Economy Slows Drastically”) and https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-5936 (“Obama’s Ship Is Sinking”) and http://www.telegraph.co.uk/finance/economics/11129108/Mass-default-looms-as-world-sinks-beneath-a-sea-of-debt.html (“Mass default looms as world sinks beneath a sea of debt”) and http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/11131576/Dollar-surge-triggers-oil-rout-as-Brent-crude-tumbles.html (“Dollar surge triggers oil rout as Brent crude tumbles”) and http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/11140156/World-on-the-brink-of-oil-war-as-Opec-bickers-over-price.html (“World on the brink of oil war as Opec bickers over price”) and http://www.telegraph.co.uk/finance/economics/11146273/The-ten-biggest-threats-to-the-global-economy.html (“The ten biggest threats to the global economy”) and http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/11150306/German-model-is-ruinous-for-Germany-and-deadly-for-Europe.html (“German model is ruinous for Germany, and deadly for Europe”) and http://www.telegraph.co.uk/finance/financialcrisis/11152731/Eurozone-on-cusp-of-triple-dip-recession-as-German-exports-crumble.html (“Eurozone on cusp of triple-dip recession as German exports crumble”) and http://www.telegraph.co.uk/finance/economics/11154553/Dam-breaks-in-Europe-as-deflation-fears-wash-over-ECB-rhetoric.html (“Dam breaks in Europe as deflation fears wash over ECB rhetoric”) and http://online.wsj.com/articles/global-signs-of-slowdown-ripple-across-markets-vex-policy-makers-1413148874 (“Global Signs of Slowdown Ripple Across Markets, Vex Policy Makers”) and http://www.dickmorris.com/stock-market-crash-2014/ (“The Stock Market Crash Of 2014?”) and https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/#comment-6177 (“Black America’s Rising Woes Under Obama”) and http://www.telegraph.co.uk/finance/economics/11168355/World-braces-as-deflation-tremors-hit-Eurozone-bond-markets.html (“World braces as deflation tremors hit Eurozone bond markets”) and http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/11188635/European-stress-tests-25-banks-fail.html (“ECB: 25 banks not strong enough to withstand another crisis”) and http://www.cnsnews.com/news/article/ali-meyer/labor-force-participation-remains-36-year-low-0 (92,447,000 Americans Not Working…) and http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/11348809/World-deflationary-forces-have-swept-away-Switzerlands-defences.html (“World deflationary forces have swept away Switzerland’s defenses”—”[V]enerable central banks [will] be overwhelmed by deflationary forces and global economic disorder”) and http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/11391211/Devaluation-by-China-is-the-next-great-risk-for-a-deflationary-world.html (“Devaluation by China is the next great risk for a deflationary world”—”China is trapped”) and http://www.ft.com/intl/cms/s/0/2554931c-ac85-11e4-9d32-00144feab7de.html#axzz3Qpl9EfyV (“Debt mountains spark fears of another crisis”)
The effects of Ebola and other infectious diseases have not been quantified fully by most economic seers. In the United States and other countries, Ebola created an almost panic-like response, which may affect global economies dramatically and in ways unknown presently.
See http://www.cbsnews.com/news/ebola-outbreak-world-bank-issues-dire-warning-about-economic-impact/ (“World Bank issues dire warning about Ebola’s economic impact”) and http://www.telegraph.co.uk/finance/markets/11148603/Ebola-Could-viruss-spread-cause-financial-market-turmoil.html (“Ebola: Could virus’s spread cause financial market turmoil?”) and http://www.dailymail.co.uk/sciencetech/article-2787987/the-world-s-deadliest-outbreaks-interactive-map-shows-human-cost-flu-bubonic-plague-ebola-globe-541.html (“The world’s deadliest outbreaks: Interactive map shows the human cost of flu, bubonic plague and Ebola globally since 541”)
America’s stock mania, and that in China and elsewhere, have decoupled from economic reality. When the global meltdown arrives with all of its fury—which is simply a matter of time—it may make 1929 seem like child’s play.
Hold on tight. Things will get very ugly and scary between now and the end of this decade—economically, militarily, and socially!
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ECONOMY DOWN, MARKETS UP, AND CONSUMER & INVESTOR CONFIDENCE UP.
A big unknown with me is the effects of increasing global conflicts and wars, as we have begun to see already in the Middle East in recent years. Some of it was caused by the U.S. exporting its inflation via dollar-priced commodities such as wheat and food that disproportionately hurt poor, third world countries like Egypt, Syria, and Iraq. Rebellious citizens and street riots were the immediate effect of going to bed hungry, as many of them did 2-3 years ago.
A lack of national leadership in America only aggregated an already bad set of emerging global financial conditions. Americans seem to comfortably assume we won’t feel any adverse effects from increasing wars and conflicts. I think we surely will, as does the author.
What will be the effect on the price of gold, interest rates, and stock markets? Will capital flight from abroad into the U.S. boost everything in a final bull market crescendo, ultimately followed by a huge bust as fast money eventually leaves an increasingly confiscatory United States (Government)?
OR, will we first suffer asset deflation ( bear market) followed by very high inflation (25%) for a few years ( wiping out the middle class in the process) as foreign creditors (China, Russia) cut us off and force America (Congress) into instant austerity ( living only within our means)?? Which way first determines how to position yourself. Nobody really knows, adding to uncertainty.
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Thank you, Craig, for your comments.
You have said:
I agree completely, and would add Putin and his designs on Ukraine “and beyond” to the list, as well as China’s plans for expansion, North Korea, and of course terrorists’ activities around the world.
See also http://www.moneynews.com/StreetTalk/Moisi-war-US-1914/2014/06/26/id/579487/ (“World at Risk of Another Global Catastrophe”)
You added:
Again, I agree completely.
Next, you asked:
While I believe the effects globally will equal or surpass those of the Great Depression of the last century—principally because the fail-safe measures adopted after that depression will not have worked to prevent this one—I believe too that the United States will fare better than other countries.
With respect to your last paragraph, I believe we will “suffer asset deflation,” and more and more of it. The domestic real estate market may be devastated.
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Correct me if I am wrong, but for the currently red-hot residential real estate market here in SoCAL to be “devastated” would first require a number of financial and monetary changes. Primarily, a significant increase in the 30- year mortgage rate. If it were to go up just two points to say, 6.1% APR from the current 4.3%, then we would feel a slow-down and be poorer for it. A decrease in household wealth for 2/3 of the population would have wide-ranging effects, including a recession. Consumers would pull-back.
However, these are not normal times, as you know. Both the local managers of Bank of America and Wells Fargo told me they have not been making many traditional home loans for the last five years, even when 30-year rates were 3.2% APR two years ago. Most homes being purchased today are not being bought with borrowed money (from banks), but instead are cash purchases ( like a item from the grocery store). We suspect foreign buyers are a larger part of the existing home purchase story.
So, why would real estate necessarily suffer in the next few years, even if long interest rates increase? Inflation would cause more people to buy tangible assets, possibly boosting gold and real estate, while moving away from stocks and bonds ( financial or paper assets). Again, the future is unclear.
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Thank you again, Craig.
I grew up in West Los Angeles; and my father was a real estate broker, with offices in Encino and Brentwood, before the advent of the mega-firms.
He had income and residential departments; and I remember when his firm went for almost an entire year without making a dime, until he sold a big estate in Brentwood.
Today’s realtors are “babes in the woods.” Most have never known truly hard times, such as we are discussing. I had a family member who owned a house in Irvine, and told me that prices would never go down. P.S. The person lost $800,000 when the house was sold.
My undergraduate major at UCLA was economics; and what goes up, comes down, often with a thud. I believe the “corrections” between now and the end of this decade will equal or surpass those of the Great Depression.
Could I be wrong? Of course so. And this advice may be worth exactly what you are paying for it. 🙂
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I don’t think we will have 1930’s style deflationary depression, but we could be quite stagnant for a long time to come, just like Japan has been for the last 20 years. We share a number of attributes with Japan, including lower productivity, high debt, and an aging population ( Baby Boomers). It all points to slow or low growth for years to come.
I guess much depends on how we handle our debt load in the coming years. We can not go on “extending and pretending” forever without risking another crisis. I think we are in for a slow-bleed, if we are lucky.
My Grandparents had a house in Glendale and a rental in El Segundo, right across the street from the main High School in 1929. They were not invested in the stock market! It was a small 2-Bedroom bungalow. Today, the property has two rentals in back ( 2-Bedroom each) and the whole property ( all 3 structures) are worth about $1.1 Million. Its an income producing property, which is a plus.
However, the primary reason my Grandparents sold it was because they could not find any renters during the Great Depression who had any money to pay rent. That is the situation today in places like Spain or Portugal. Properties are vacant. So, they traded a house in Glendale and the Rental House in El Segundo for a house in La Canada, CA. It worked out for them.
For comparison purposes as to how “good” we are doing, try this: My grandmother was a public school teacher. She retired in 1956. They built a brand new house in North Glendale, all on her pubic school teacher’s pension. My grandfather (disabled from a stroke) bought a new Chevrolet every three years from 1956-1968 when he passed-on. Try doing that today with a public pension, if you have a pension. Times are not comparable.
Their same house in North Glendale is worth about $750,000 or so today. It was built new in 1956 for $15,000. My Dad bought it for $50,000 from my Grandfather. Inflation since then has driven the prices of homes way up so that new buyers can not afford them. People’s incomes must rise to keep current with all the debt. That will present a problem maintaining these valuations, much less pushing them up much higher.
I see stagnation as the more probable outcome going forward, but always with the lesser probability of a tail event ( crash ). You seem to think we will take the short route to correction. Harry Dent is another one who forecasts this scenario, along with Bob Prechter of Elliotwave.com.
You might be right, but I sure hope not. We don’t have to go there. Its a national choice. If we keep electing Obama’s, we will suffer. That much I know. Seems like voters are not being realistic and only reaching for the “next banana”. No leadership. Makes me nervous.
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Thank you again, Craig, for your thoughtful comments.
The simple house that my parents built in Westwood before I was born, a mile west of the UCLA campus, off Sunset Boulevard, is valued at $2 million today; and little has been done to it since I grew up there.
I do not believe in a “soft landing” this time. Rather I believe we will have a “1930′s style deflationary depression.” I see the convergence of global economic, military and social “challenges” that may produce a “perfect storm.”
Clearly, our national leaders (e.g., at the White House, in Congress, at the Fed), and those of other countries, have few ideas how to deal with it and they are apt to panic. As I wrote more than five years ago:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html (“Euphoria or the Obama Depression?”)
Lastly, is there a possibility that prime real estate in major “world cities” (e.g., London, Paris, NYC, LA, San Francisco) will fare better than real estate elsewhere? Possibly so; however, sellers in LA have been taking a bath recently as their high-end homes did not sell, and the prices had to be slashed dramatically. My family member is a perfect example, losing $800,000 on a house in Irvine that was in a prime location.
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Could we perhaps consider a worst-case scenario, that cash-flush foreigners, aka Muslims from oil rich countries are buying up real estate in American neighborhoods to relocate hundreds or thousands of Sharia practitioners wholesale into our neighborhoods? Would Mr. Obama, the master of the depressed recovery, like that? Instant no-go zones. Should I put it past him? No, do not put it past him.
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Government Does Not Work
Scotland has just finished voting whether to become independent from the UK; and the vote was close. Glasgow voted “Ves”; and independence movements exist in Northern Ireland, Wales and elsewhere in the world.
The problem is government, not whether it is “devolved.”
Government does not work, period. Anyone who has worked in Washington, and on Capitol Hill, will admit this if they are honest.
To “devolve” American government from the federal realm to the States or local governments is merely to kick the can along. Government gets worse at the State and local levels; and given the atrocities of our federal government, this is mind boggling.
I came to Washington as a U.S. Army officer stationed at the Pentagon, which jokingly was referred to as “Fort Fumble” by those who worked there. Then, I went to work on Capitol Hill and had a chance to view other agencies of the federal government; and I realized that the Pentagon and our military were the best by far.
Then, I left for the private practice of law, and represented two States as clients, one of which was my old home State of California, which I found to be a “joke.” No wonder people describe it today as ungovernable.
The government that governs least governs best. Can the American people roll back government? Can other countries do so too? The EU is perhaps the prime example of a bureaucratic “mess,” or government at its worse.
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What’s your alternative for organizing society? It isn’t we-the-people’s GOVERNMENT that’s the problem, but they-the-regulators’ BUREAUCRAMENT that’s been driving the corruption at all levels, and which latter term – bureaucrament – I’ve coined to explain why America has been in decline for decades. We haven’t been a democratic republic from the time Crazy Abe trashed the finest organizing/civilizing document in world history—our Constitution. That’s when bad BUREAUCRAMENT supplanted good GOVERNMENT. -Richard
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Thank you, Richard, for your comments.
Franklin Roosevelt began the push toward “cradle-to-grave,” ever-expanding government in the United States, and it has continued ever since.
Barack Obama may be taking it to an entirely different level, by bypassing the Congress, and expanding government via executive orders and regulations.
As you have gathered, I am against ever-expanding and all-intruding government at the federal, State and local levels. Bureaucrats at all levels are part of the problem.
Can we roll it back? Only when the people rise up and say enough is enough. We are not at the “tipping point” yet, but we are moving toward it.
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GOOD JOB OBAMA !
America’s government has not functioned as a “Republic” for at least 83 years. So, whatever rights you still enjoy are no longer assured. You don’t really have any rights. So, Big Government means “Little Church” and a secular society is not long for this world.
So, just like Rome, our decline will be a mess and many will suffer along the way long before it finally collapses. I believe the embedded trends we now should see have just begun and no elected politicians of either political party can change the eventual outcome. In fact, our politicians seem to be speeding-up our demise.
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Thank you, Craig, for your comments.
I have inherent faith in the American people and in our great nation, and in God.
Yes, the pendulum swings. We have survived this long, and I do not believe our “demise” is imminent at all. Indeed, I believe we will celebrate our anniversaries in 2076 and thereafter.
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Cash Is King
In an article entitled, “Billionaires are hoarding piles of cash,” Robert Frank of CNBC has reported:
See http://www.cnbc.com/id/102021996 (emphasis added); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-5264 (“Global Economic Conditions Worsen: Green Shoots Will Disappear”)
As I responded in an interview:
See http://seekingalpha.com/instablog/2951-market-shadows/31177-interview-with-timothy-d-naegele
Many major global companies have been hoarding cash for a long time now, including Apple and Ford, which have learned valuable lessons from the past.
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The True Reason Gas Prices are Falling
Stephen Moore—who formerly wrote on the economy and public policy for The Wall Street Journal, and is chief economist at The Heritage Foundation—writes:
See http://dailysignal.com/2014/10/26/gas-prices-falling/ (emphasis added)
Clearly, Barack Obama is a fad and a feckless naïf, and a tragic Shakespearean figure who will be forgotten and consigned to the dustheap of history . . . except for the tragic mistakes he has made and will continue to make until his failed presidency ends.
His naïveté has been matched by his overarching narcissism, and he will be considered more starry-eyed and “dangerous” than Jimmy Carter. His presidency will be considered a sad watershed in history. Indeed, it has been said about Obama—America’s narcissistic “Hamlet on the Potomac” and “Jimmy Carter-lite”:
This is an understatement.
The fall in oil prices may doom Russia’s dictator-for-life Putin, which cannot happen fast enough.
See https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-6296 (“Oil Slump Leaves Russia Even Weaker Than Decaying Soviet Union“)
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The German Miracle Is Tested
The UK’s Telegraph has a fascinating article about why Germany is still not a unified country, 25 years after the Berlin Wall fell:
See http://www.telegraph.co.uk/news/worldnews/europe/germany/11215784/The-seven-charts-that-show-why-Germany-is-still-not-a-unified-country.html (emphasis added; charts omitted)
I was in Berlin when the Wall was still standing, and I walked into East Berlin briefly.
Since the Wall fell, I have traveled in Berlin and in the east many times. I was in Berlin when the Soviet troops were leaving, and selling their uniforms and plumbing fixtures from their barracks, and going back to “tent cities” in the USSR.
I was there when the East Germans scrapped their Trabants, and bought VWs with their “reparations” from the West.
It has been 25 years since the Wall fell. With usual Germany efficiency, roads that went only to the Iron Curtain, and were overseen by manned guard towers, soon went through and there were no vestiges of what had been . . . except in the hearts and minds of the East Germans.
To understand the East Germans, it is useful to understand Americans in the defeated South after our Civil War. They were members of a nation that had been beaten soundly, yet they were part of a larger nation that prospered and flourished. To this day, many Southerners still have chips on their shoulders, which they might not totally understand.
The same will be true in the former DDR, for generations to come. And Russia’s Putin, who served with the KGB in East Germany, may attempt to exploit this—just as he has done in Georgia and now Ukraine.
The West must never forget that he is a Cold Warrior, who learned his craft well as a KGB operative in East Germany—or the DDR, as it was known before the fall of the Wall and the collapse of Erich Honecker’s government—which was one of the most repressive regimes in the Soviet Union’s orbit, or the Evil Empire.
See https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-5521 (“U.S. Military Chief Compares Putin’s Ukraine Move to Stalin’s Invasion of Poland”)
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UK’s Cameron: World Facing Second Economic Crash
The UK’s Telegraph has reported:
See http://www.telegraph.co.uk/news/politics/david-cameron/11234920/Cameron-world-facing-second-economic-crash.html
Hold on tight. The worst is yet to come!
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The End of China’s Economic Miracle [UPDATED]
This is the title of a Wall Street Journal essay by Bob Davis, which states:
See http://online.wsj.com/articles/the-end-of-chinas-economic-miracle-1416592910?mod=WSJ_hp_RightTopStories; see also http://www.telegraph.co.uk/finance/economics/11246733/China-blinks-as-economic-downturn-deepens.html (“China blinks as economic downturn deepens“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-5264 (“Global Economic Conditions Worsen: Green Shoots Will Disappear“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-4625 (“China’s Speculative Bubble“) and http://www.telegraph.co.uk/finance/economics/11333928/Bank-of-America-warns-of-lethal-damage-to-Chinas-financial-system-as-deflation-deepens.html (“Bank of America warns of ‘lethal’ damage to China’s financial system as deflation deepens“) and http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/11391211/Devaluation-by-China-is-the-next-great-risk-for-a-deflationary-world.html (“Devaluation by China is the next great risk for a deflationary world“) and http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/11450691/Liquidity-evaporates-in-China-as-fiscal-cliff-nears.html (“Liquidity evaporates in China as ‘fiscal cliff’ nears“)
Hold on tight. Things will get very ugly and scary globally between now and the end of this decade!
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The New Oil Order
In an important Wall Street Journal editorial, it is stated:
See http://online.wsj.com/articles/the-new-oil-order-1417219168; see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-6372 (“The True Reason Gas Prices are Falling”)
Barack Obama and his “environmental Nazis” have done everything in their power to prevent this from happening. The majority of Americans must rise up and say: “No more.”
The United States is becoming the world’s energy leader again, despite their efforts to block and derail it!
. . .
Also, we may witness the departure of Russia’s despot Putin.
Like Hitler before him, Putin is a megalomaniac who must be terminated.
If this had happened with Mussolini, Hitler, Saddam Hussein, Osama bin Laden, and other dictators and tyrants before Putin—including Stalin—millions of innocent lives would have been saved.
See, e.g., https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-6417 (“Putin’s Futile Campaign To Rebuild The Lost Soviet Union Is Racing Against The Ruble’s Collapse”) and http://www.telegraph.co.uk/finance/economics/11265205/Russian-rouble-shaken-in-biggest-one-day-fall-against-dollar-since-1998.html (“Russian rouble shaken in biggest one-day fall against dollar since 1998″—”The currency of Vladimir Putin’s Russia has been left shaken by falling oil prices and sanctions related to ongoing tensions in Ukraine”)
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WORLD AT WAR
We are in a world full of new and growing conflicts and wars which come in many forms and shapes. The shooting wars, which get all the mass attention because they are explicit and highly visible, do not accurately reflect the true extent of how unstable the world has become. Its rather striking we could sit IN our homes each weekend and be totally secure in our status and finances seemingly without a care in the world. We are hiding from reality.
Any change in this New Global Order ( Swiss Gold Referendum) could quickly and easily devolve into disorder ( shortage of physical gold ), catching the uninformed and unwary by complete surprise. There are many possible surprises lurking out there. Odds are, we will come to know some of them on occasion in the coming years. We need to accept and prepare for the reality we live in an age of global crisis. We can either hide and ignore it ( turn off the news) or try to position ourselves for the blows sure to come.
A lot of these issues are of a global financial nature. The post WWII global financial system is Dollar ( American) centric, as the dominant global superpower. However, decades of incompetent Presidents, wasteful and excessive Federal spending, FED money printing ( QE ) and borrowing ( national debt ) have each seriously weakened the underpinnings of the Old Global Financial Order and permanently reduced overall confidence in America, its political leadership, and our currency.
In response to our growing financial weakness ( seen clearly abroad), China and Russia and Iran have openly stated they want to move away from dependency (use) of the U.S. Dollar ( “Petrodollar” ). We now have widespread worldwide currency wars between sovereigns. In addition, these financial conflicts are complimented with military developments ranging from outright aggression ( Putin in the Ukraine ) to China ” configuring their military” to attack us. The future looks increasingly dangerous to me. It bizarre for whole nations to ignore the trends and be complacent to the degree we are at home. Its just like the 1930’s. ( National Parochialism and self-centeredness )
Each tries to debase their currency faster than their neighbor to gain a temporary or perceived economic advantage in a world already saturated with (bad) sovereign debts. Little net actual economic growth can be found in the developed economies after inflation. Real wage growth is almost nonexistent in spite of declining ( improving) government employment statistics. Western Societies are dividing further into the smaller component of well-to-do with financial assets growing and the rest (majority) little or no economic improvement and growing individual indebtedness ( student loans ).
Our National Choice is simple: We can ignore ignore the growing threats to our peace and development ( future war ) and be victims, or we can prepare. We too often concentrate on tiny, trivial, local “problems” that are “personality” focused ( Justin Bieber’s run-ins with the law ) and ignore the “elephant in the room”. Its more traditional liberal-conservative political party arguments about trivia with no true leadership or national consensus.
Unfortunately, we simply do not appear able to handle the bigger or more serious matters on any level (private or government). We keep “kicking the can down the road”. Eventually, this road dead-ends and we then have a T- Intersection to choose from. Our poor collective choices and unending delays will eventually have a cost that ALL must pay for, one way or the other.
Despite our collective HOPES, in this world, there is really no free lunch in the end. We do not live in a consequence-free environment. If we prove incapable of self-government, someone will likely do it for us. ( Oligarchs, Global Central Bank Elites, or a ” Big Nanny” for the “Nanny State” ( Hillary Clinton?). As it is today, we all stand charged of being grossly irresponsible. Jury is still out. Guilty or Not-Guilty? Only time will tell.
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Thank you as always, Craig, for your comments.
On balance, I do not disagree. However, I believe the United States will fare better than other countries.
We have two more years to endure of the failed Obama presidency, which may be fraught with even more problems. Then, let us hope that the American people elect leaders who are worthy of our trust.
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HOW WE WERE ALL BRIBED BY CENTRAL BANKERS
Now, with the Swiss rejecting a gold-backed Franc (The Referendum), the world’s central bankers are now ” all-in” with similar monetary policies to expand their respective balance sheets with more debt “assets” and print even more money (supply), while each further lowers interest rates into negative territory.
Still, no new or sustainable economic growth has been realized in five years. We read each day that more jobs are created and unemployment is going down. Corporate profits are said to be up. Federal Government Deficits are reportedly going down. On the surface, we are in a Great “Recovery”. The stock markets even keep reaching new highs and give us the necessary Christmas Cheer. We have “Visions of Sugar Plumb Fairies”.
We feel pretty good about things. Are we all mad? ( We are uneasy or scared but sure won’t admit it). The “Ultimate Bubble” may turn out to be the Biggest Rubble ever.
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Again, I agree, Craig.
However, one must distinguish between American bankers and those of other countries. I have represented more than 200 U.S. banks; and their leaders are generally very responsible. Moreover, the American financial institution regulators (e.g., the Fed, the FDIC, the Comptroller, the NCUAB) watch their balance sheets like hawks, and are always seeking more capital rather than less.
This is not true of other countries, whose banking systems could collapse in the worst of times. The Wall Street Journal is reporting today that China, which has very serious economic problems, is in the process of adopting FDIC-like deposit insurance.
See http://online.wsj.com/articles/china-releases-draft-plan-for-bank-deposit-insurance-1417340960 (“China Releases Plan for Bank Deposit Insurance”); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-6526 (“The End of China’s Economic Miracle”)
In other countries, such deposit insurance is nonexistent; and even in the United States, there is no insurance with respect to mutual funds. In a crash, fund investors would be standing in lines trying to redeem their monies, like the Great Depression. The liquidity crisis would drive down markets to new lows.
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NO PLACE TO HIDE, NO PLACE TO RUN, IN A TRUE COLLAPSE
Obviously, if we ever have a crash of the order of magnitude of 1929-1932 or Japan post-1989, when markets their declined -80% and only recovered to -60% 20 + years later, all investors with financial assets or real estate would be in big trouble. So would the ” Too Big too Fail” Banks.
The Federal Government would not have the available resources to bail out all the largest banks again. FDIC would not have enough money (funds) to make good on their obligations (word) either. Trust will be hard to come by in a true collapse. Its already becoming somewhat rare. None of the Banks trust each other anymore, as it is.
Stock valuations would slide rapidly into the tank and into low single digits, as there would be NO buyers (during a panic). In fact, stock market computer trading systems would probably seize-up and the markets would have to be closed-down for days or weeks in order to sort it all out. In the process, Investors would be unable to access any of their investments or buy/sell. The lines Your broker’s phone lie would be one continuous busy signal. For the moment, secure Cash would Be King. However, widespread panic is contagious.
Consumer spending would rapidly fall and the economy would go into a deflationary depression like we have never seen in our lifetimes. Unemployment would soar to 30%, officially. For survivors, it would be a once in a lifetime chance of unbridled opportunity. Fire sale on all assets for 10 cents on the dollar. For the majority of Americans who still fully trust the U.S. Government, it will be a time of great hardship. Many will suffer. Those who plan ahead a little bit will be more likely to survive ( on their own). Ironically, being a prison inmate would be relatively safe place to hang-out. ( Think AMC’s series “Walking Dead”). It would be much better guarded than your suburban neighborhood residence.
Even many U.S. Banks would end-up broke and be closed down by the FED, as their primary capital ( bonds) or home mortgages devalued a similar amount. They would have no net worth or liquidity. So, the real lines would be for depositors waiting to receive their FDIC insurance payouts after a bank closure holiday. It could be a long wait for depositors indeed.
It would possibly take months to settle accounts with no cash in the meantime. Many poor and former Middle Class citizens would riot in the streets and make Ferguson, MO look like a Mardi Gras celebration. Those times would require unconventional skills and approaches such as silver or other goods to barter, as the financial system and point-of-sale terminals and ATM Machines would be Temporarily “Out of Order”.
People would possibly starve in the cities as grocery store shelves quickly emptied faster than just before Hurricane Katrina. A monetary collapse would mean a collapse in civil order, as well. In the event of such a worst case scenario, you would not want to be living in any American City or even near one either.
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Thank you again, Craig.
On balance, I agree with you; however, I still believe the United States will fare better than other countries.
To respond to your specific points:
First, I believe economic historians will deem the present period in global history as the “Great Depression II,” or by some similar name.
One must never forget that prior to World War II, there were false signs that the last Great Depression was ending; however, it really never ran its course until the end of that war. This depression may not run its course until the end of this decade, or longer.
Second, the federal government has unlimited resources; and the “too-big-to-fail” banks would not fail.
You are correct that as the value of real estate assets falls dramatically, the regulators might require that “mark-to-market” accounting be employed, which would drastically reduce the balance sheets of real estate lenders and borrowers. Many would go out of business or otherwise fail.
More serious would be the runs on funds, which I have discussed above.
Third, FDIC insurance would still be worth its “weight in gold.” It would be the only thing worth trusting, in my opinion. One cannot eat gold or silver . . . or stocks.
I have discussed all of these issues in an interview that I gave some time ago, which is still relevant today.
See http://seekingalpha.com/instablog/2951-market-shadows/31177-interview-with-timothy-d-naegele
As I stated in that interview, I believe the stock market is a “fool’s paradise,” and that cash is king.
See also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-5988 (“Cash Is King”)
Fourth, you concluded by writing:
I agree. Ferguson teaches us that lesson in spades.
Lastly, this thread is getting too long to be read easily on smartphones.
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MARKETS ARE GIVING WARNING SIGNS OF PENDING CHANGE
If you want a glimpse of what a crash (panic) might actually look like, just look at Halliburton (HAL) stock on Friday after OPEC agreed to keep oil production “as is”. The “professional” investors caved-in and all sold-off energy related stocks indiscriminately. Halliburton declined -11% in just a half-day’s trading. A smart investor could pick some up at opening at $42/share ( 2012 Prices). Investors are operating on emotion and liquidity and at times, have a “hair-trigger” on their sell orders en masse.
Additional evidence of general unease at lage and in the markets besides occasional hair- trigger selling is the current unavailability of silver coin. Since October, the U.S. Mint has been sold-out of 2014 Silver Eagles and won’t have any new stock (2015 Issue) until late January. In addition, no coin dealers have any bags of “junk silver” ( pre-1964 U.S. Minted quarters or dimes) in stock either. Even if you could find any silver coin nationally, you would have to pay a 19% premium over spot to get it. Supplies are only sent to primary dealers, not the public. They will sell-out quickly.
A similar imbalance or shortage of physical gold coin may soon develop, as well. ETF’s like GLD (“paper gold”) might still be going down, but there is an apparent shortage of physical precious metals globally. In any case, supplies are very tight. If there is even a slight increase in demand, the price could skyrocket for gold or silver coins next year. All it takes is a small increase in demand for physical gold delivery instead of forward swap agreements ( derivatives) . Something is amiss here!!
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Thank you again, Craig.
As I said in the interview that is cited above:
See http://seekingalpha.com/instablog/2951-market-shadows/31177-interview-with-timothy-d-naegele
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Russia Is Collapsing, And Putin’s Days Are Numbered
The UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, has written:
See http://www.telegraph.co.uk/finance/economics/11266746/Capital-controls-feared-as-Russian-rouble-collapses.html (emphasis added; charts omitted); see also https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-6417 (“Putin’s Futile Campaign To Rebuild The Lost Soviet Union Is Racing Against The Ruble’s Collapse”) and https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-6301 (“Russia Is A Defeated Power Of The Cold War Era”) and https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-6296 (“Oil Slump Leaves Russia Even Weaker Than Decaying Soviet Union”) and https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-5521 (“U.S. Military Chief Compares Putin’s Ukraine Move to Stalin’s Invasion of Poland”) and https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-4661 (“The Pygmy Putin Rules Over A Third World Country, Russia”)
Putin is not long for this world. The countdown has begun.
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NEW GLOBAL DISORDER ?
We are witnessing a financial (oil) war between Saudi Arabia ( The Western allies ) and Russia, Iran, and smaller OPEC producers. Often in the past such financial Wars ultimately led to real (shooting) wars. So, how much time do we have until the tanks start to roll and the bombs start to fall?
Will someone (country) try to take-out the Saudi Royal Family or will dissent spread in the Arab World as funds dry up and populations become discontented and aroused by more radical elements?
Either way, it may be just a matter of time until the Saudis are gone, along with the Petrodollar. Then we have real problems at home ( rapid inflation, high interest rates, declining assets and collateral at banks). Global unrest (wars) could be the next contagion coming in 2015.
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Well, Craig, I usually do not take issue with your comments, except to dissent here and there. However, my gut reaction after reading your latest is to respectfully dissent. 🙂
Yes, global disorder seems to be in the cards, but the American hand seems to be getting stronger with each passing day. With our oil “supremacy”—despite Obama and the “environmental Nazis”—the Middle East is less and less important to us, except as an “irritant.”
I do not agree that the Saudi royal family will be gone anytime soon. They seem to have a knack for surviving, like other royal families in the region (e.g., Jordan).
You have said:
If so, then all bets are off with respect to Israel and the region as a whole. However, I do not see things as bleakly as you do, except for Russia:
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-6593
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I think we have become way too complacent in many respects and are making mistakes that could either “come back to haunt us” or eventually, hurt us all outright. For a picture that shouts a thousand words, consider this one of all five nuclear-powered aircraft carriers lined up in Norfolk, Virginia on Feb. 8, 2014.
See http://img.gawkerassets.com/img/18ah4h33g8omrjpg/original.jpg
I thought the Navy learned a hard lesson on Dec. 7, 1941 at Pearl Harbor. We have too many enemies to be publicly letting our guard down like this. Its a risky (thoughtless) command decision from the White House that should not remain unnoticed. Plus, It looks really bad, but did anyone notice it or mention it on the evening news? Of course not. America is asleep.
Last night on Fox News its all about the Black Caucus in Congress and Ferguson, MO with the motto: ” Hands-up, Don’t Shoot”. We don’t understand that we more dangerous enemies around the world ( and growing) than from a bunch of illiterate urban homies looting their own neighborhoods land small businesses or someone else’s while the local police stand-down ( As they did under LAPD Chief Gates after the Rodney King verdict in 1992) .
My conviction is my fellow Americans pose a much bigger threat to my life, well-being, freedom, safety, and resources than ISIS could ever be. Stupid voters or stupid ( uninformed) people are dangerous, particularly at home. Thats a fact.
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Thank you again, Craig.
Yes, indeed, the idea of having our carriers sitting as “ducks in a row” at Norfolk is absurd, and of course reminiscent of Pearl Harbor on December 7, 1941. Obama’s slashing of our military budgets accounts for this; and we have more than two years to go of his failed presidency. What more disasters may we encounter?
I agree with your comments about Ferguson and other riots; and this really began during summer of 1965 with the Watts’ riots in Los Angeles.
Barack Obama is anti-military and a racist.
If one has any doubts whatsoever, please read his book “Dreams from My Father,” which sets forth his core beliefs in great detail—and how he has been governing, and what we can expect during the remaining two years of his presidency.
See https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/
The thugs and hoods who torched Ferguson and other communities should be treated as domestic terrorists, and dealt with harshly. They must not be coddled, which has happened since the Watts’ riots.
And Obama is wrong: there is no point in trying to understand their anger, any more than trying to understand the anger of other terrorists.
He did not grow up on the U.S. mainland, so he does not understand the feelings of most Americans.
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For what its worth, my late father watched the Denish De Souza Movie “Obama’s America 2016″, which had quotes from his book ” Dreams of My Father”. My father responded to the quotes as “Bull-Shit”. His one word description of President Obama and his supporters in 2013: “Disgusting”. Incidentally, all of Denish’s predictions have come true to date:
1.) President Obama has doubled the National Debt to $18 Trillion, headed to $20 Trillion in two more years. Nothing Congress can really do about it. It will never be paid-off. The Chinese know this and are taking steps to DE-dollarize over time.
2.) President Obama has strengthened our enemies and weakened our allies.
3.) The Federal Government is vastly larger and more intrusive in everyday life, while the individual citizen has been diminished in importance and value.
None of these “Changes” can be fully reversed by future Presidents. So, like it or not, we are ALL equally stuck with the consequences of our (poor) collective choices. The voters got exactly what they voted for; what they wanted. So, tell them to quit whining and man-up. “Life is hard, but its even harder if you are stupid”, John Wayne.
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I agree with all of what you have written, Craig; and we have more than two years to go of the Obama presidency. 😦
As for reversing the changes, it depends on whether the GOP congress has any cojones; and whether a Republican is elected president in 2016. My hope is that Mitt Romney will run and be elected.
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Mitt Romney has repeatedly said he has no interest in running for President again. Mitt said in one interview last Summer on Fox: ” My time has come and gone”. Few presidents have won after losing prior elections, except Richard M. Nixon. He turned out to be a very poor president ( “A Bum” ).
It looks like we may be in for more corruption with Hillary Clinton. In many ways, the American voters of today deserve her, particularly if they want the “Nanny State” which many do. For the Nanny State we need a ” Big Nanny”. Bill O’Reilly previously reported surveys indicate the number one concern with most voters is not “the economy”, jobs, or employment anymore.
Their main concern today is keeping their government paid stuff ( entitlements, other than Social Security and Medicare). America has radically changed in just the last 14 years. I do not see voters going back to the 1980’s values. We are simply too dependent upon the many Federal government programs ( Big Govt.) and most voters are too stupid ( or charitably, dumbed-down).
Mitt would never be an attractive candidate to average people like that. He is way smarter than the average Joe Six-pack and he did not appeal to the biggest racial group in America, Hispanics. Hispanics want free stuff and Democrats promise more of the same. So, Hillary is a slam-dunk. Right now, there are 20 potential Republican contestants for the party nomination in August 2016. Hillary has already started her campaign and has raised a massive war chest. She will be hard to beat unless we can find a man of the people. Mitt is not a man of the people, he would be a man for the people.
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Hopefully Mitt changes his mind, and runs and gets the nomination, and is elected. I do not like anyone else in either party; and if he is not the GOP candidate, I may not vote.
With respect to his ability to appeal to Hispanics, I would like to see Jeb Bush as his running mate—who speaks Spanish fluently and can help Mitt in Florida, and whose wife is Hispanic.
This, I believe, would be a winning ticket nationally.
Richard Nixon was a far better president than Obama.
See https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/ (“Is Obama The New Nixon?”) (see also the comments beneath the article)
I do not believe Hillary will be the next president, nor do I believe she will get the nomination. However, I did not believe Obama would be reelected in 2012 either.
See https://naegeleblog.wordpress.com/2010/12/03/barack-obama-is-a-lame-duck-president-who-will-not-be-reelected/ (“Barack Obama Is A Lame-Duck President Who Will Not Be Reelected”)
I might have retitled the article, “Barack Obama Is A Lame-Duck President Who May Not Be Reelected,” and it might have had more staying power. 🙂
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POLITICS (ELECTIONS) ARE CHESS
I think the Republican Party is instead attempting to groom Florida Senator Marco Rubio ( Cuban Immigrant ). I am not sure he would have changed the outcome if Mitt Romney had picked him instead of Paul Ryan ( Political Ad “Wheeling” Granny off a Cliff and saying “Cut”, “Cut, “Cut”).
You have to instead analyze where the average American is at right now to accurately forecast the future. According to Bill O’Reilly, the Average American, ( 70%) of all households, only earns an annual income of less than $50,000/yr. In the large cities where most of the voters live, this is not very much money, especially after all the various taxes. They are beat-down and pretty much only in survival mode.
You can detect this easily with your own everyday observations. You need not discuss matters with your peers or professional class because they don’t decide election outcomes anymore as their overall numbers are too small. Instead try the checkout counter at the local grocery store, such as Vons. Most of the workers are part-time in retail (grocery), except management.
I casually mentioned that we berthed all our aircraft carriers in one place ( Northfork, VA) and asked if we learned anything in the last 72 years? The cashier had no interest, made no response, and no comment except can I see your Vons Card. It did not register. This is not unique. Most ordinary people you meet in public don’t know ( their own admission) and clearly don’t care about anything except getting-by. This is what you have in survival mode.
Another example was a neighborhood woman named “Rosemary” who owned a house in the area ( since sold to some Japanese). One morning in the neighborhood park while walking her dog in Sept. 2012 I inquired about her opinion of Mitt Romney. She responded: ” I could NEVER vote for Romney, as his wife is an EQUESTRIAN !”
Seriously, this how most common people (voters) “think”. The reason they are often referred to as “low information voters” is self-evident. Most voters do not know the issues and are not inclined to learn about them either. Voters are not interested in facts, just emotion. They are complacent in their station in life. This is Democracy, or the dictatorship of the masses or by the average. Its very low-end.
A Republican would have to be a man of the people to override the widespread distrust voters have with the “wealthy” and the Republicans in their minds. Never mind they don’t know much of anything about any candidate. If they did, Hillary would not be currently lobbying for the Democratic nomination and would have long since retired.
Hillary is the corrupt candidate that Detroit loved to elect for decades; that Americans seem to esteem and she may therefore be nominated in 2016 and elected the first Woman President. Only a personable female Republican candidate, V.P. or President could nullify Hillary. She will have to have smart managers. Where is she ?
The Republican Party can no long get way by passively sitting around and trying the same old (tired) strategy ( Nominate another Bush ). Besides, I don not support or believe in political dynasties. The Roman Emperors had plenty of that. I won’t vote for either a Bush or a Clinton again as President. The Republican Party must think three moves ahead of their opponents if they want to win in 2016. Otherwise, its Hilary’s to lose.
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Thank you again, Craig.
I believe Rubio is a nice “lightweight,” who may never be ready for the highest offices in the land. Also, his Raison d’être are the issues surrounding immigrants, which may play well in Southern Florida, but not nationwide—where the “anti-amnesty for illegal immigrants” tide is likely to sink his ship.
See, e.g., https://naegeleblog.wordpress.com/2013/03/01/is-obama-the-new-nixon/#comment-6624 (“The Post-Obama Democrats”)
As for Americans as a whole, i believe they have collective wisdom.
See https://naegeleblog.wordpress.com/2010/02/26/america-a-rich-tapestry-of-life/ (“America: A Rich Tapestry Of Life”)
As I have said before, I do not believe Hillary will be elected.
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I hope she is not even nominated. I actually don’t care what they do. Similarly, I don’t care what the other guy has. I do know exactly what I have. Our collective “wisdom” is best described as “residual” wisdom. Today’s America is largely a result of the momentum of past generations, such as the “greatest generation” ( WWII). Today, we have real (constitutional) problems. President Obama has capped-off the end of rule of law.
Obama just took immigration out of the hands of Congress and used Executive Authority (EXO) in a blatantly unconstitutional manner. Nobody can do anything about it. Those 5 million new legal residents will never leave. There will be more and most of them vote Democratic, not Republican.
Don’t forget former New Jersey Governor and CEO of MS Global who misappropriated 1.2 Billion of segregated client funds and lost most of it in bad commodity trades. The Regulators did NOTHING. The criminal justice system ( AG ) did NOTHING. Rule of Law? You have to be joking at this point. Only for the poor sap who runs a red light and is unlucky to be caught by a traffic cop. Maybe a shoplifter who is spotted and detained with the goods before exiting the store. Otherwise, past tense for collective anything, except collective denial, that is.
As such, it exists more or less depending on the location (state-city) in question. Wisconsin has waked-up and is acting out as a population that has figured it out on their own and responded positively at the voting booth. New York ( Mayor Blasio) or Calif ( Jerry Brown) have not shown the collective wisdom that stands out as far as policy change. Govt. is always debatable, but I don’t accept wisdom without visible action to back it up, “collective” or not. So, there you have it. We sort of agree.
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Thank you again, Craig.
I agree completely with your first paragraph; and nowhere is this more evident than in the D.C. Circuit and the U.S. District Court for the District of Columbia, where at least two Obama appointees are abominations.
With respect to your second paragraph, I am not convinced that Obama has won . . . unless the GOP has no cojones, again.
When I spoke of collective wisdom, I meant the tides that ebb and flow. Americans can sense when something is wrong, and they vote the other way. The recent elections are a perfect example of that. The Dems were “slaughtered.” 🙂
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DEBT, REALITY, SLOW-MINDED VOTERS, AND BILL GROSS
The problem with crowds and voter cycles is there is way too much lag time for the “interesting times” we live in. It took 6 years for the voters to start to sense ( subliminally) that something is terribly wrong, but there were individuals who saw it 5 years ago. By the time the crowd(public) started to figure it out, we built-up $ 8 Trillion more dollars in National Debt. DEBT NEVER GOES AWAY !!!
Everybody’s taxes will go up or we will end-up with very high inflation some day. Read Bill Gross’s annual letter, its amusing and funny.
See https://www.janus.com/bill-gross-investment-outlook?gclid=CPSsv8jZr8ICFchr7AodSA4A7w
“Punch and Judy fought for a pie.
Punch gave Judy a sock in the eye.
Said Punch to Judy, “Would you like some more?”
Said Judy to Punch, “No my eye is too sore.”
– Mother Goose nursery rhyme
The economy is not able to handle the extra load in the saddlebags and adapt to other issues plus weak global economy, poor leadership, and a “Do Nothing Congress” that just barks like a perrito ( little house dog) and then caves-in and passes Obama’s 5 $Trillion dollar budgets. The parties are emulating each other.
One year from now, Russia could collapse and disorder erupt all over Europe as a consequence. The waves of a Russian Collapse and the downfall of Putin, as bad as he is, could be worse than what we have. We don’t know who would take over the Kremlin in the aftermath. Look at the “Arab Spring” in Egypt or Libya in 2012 for examples of “better the devil you know than the one you don’t “. Even after we elected Ronald Reagan, we still had double-dip recessions and they were real bad ones too.
Remember, It took extreme measures back then to “right the ship”. It won’t get any easier or less painful to do it next time by taking 8 years to figure it out. Things move much faster these days with the internet. Events will overtake us because the system ( Americans) responds too slowly to ever be proactive.
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The American voters gave our first “Affirmative Action” candidate for the presidency a chance. My guess is that we will never see another one given a chance in our lifetimes.
Also, our democracy moves at a “snail’s pace,” which is good and healthy.
As for the two parties, there are similariities and differences between them. The Dems emulate the far Left, and are “owned” by it, while the GOP is searching desperately for a return to the Reagan years.
You said:
It would be the next phase of the collapse of the Soviet Union, with the Putin years being a tragic interregnum for the long-suffering Russian people.
Russia may be “dismembered,” with China taking part of it. What will happen with the Kremlin in the post-Putin era is anyone’s guess.
Lastly, you said:
On balance, I believe our system moves at the right pace for most Americans—the collective “we”—which is why our democracy flourishes; and as a nation, we are still the strongest in the world today.
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A Karate Instructor I knew in College wore a “dirty white belt”. He had a saying that is very applicable to comparisons between the U.S. and other countries: “Compare yourself with yourself”.
We are not the country I grew up in and we have not been a true Republic for at least 82 years. Things and people have changed. We are not one people as might have once been the case ( in 1945). Other comparisons are not as meaningful for what our national condition (health) is. We need to reflect on the changes we have brought upon ourselves and the ones that are yet to come.
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Thank you again, Craig, for your pearls of wisdom.
Yes, a lot has changed since my first ancestor came to America from Bristol, England in 1760, Samuel Dyer, and settled not far from Thomas Jefferson, in Keene, Virginia. And a lot has changed since my Naegele ancestors came to America in 1849, from Rottweil, Germany who had 16 children. Ten years or so later, the husband began serving in the Union Army, for his newfound country.
Time marches on. The year that my father was born, Henry Ford launched the Ford Motor Company; and the attack on Pearl Harbor occurred the year that I was born.
We cannot hold back time. Ours is the greatest melting pot in the world, with people here from every corner of the earth. As I wrote in an earlier article:
Lastly, today is the 5th anniversary of this blog. It began with my article about Barack Obama, because I had read his book “Dreams from My Father” twice. His core beliefs were not in sync with how he had been sold to the American people; and I was stunned by the book.
I have had lots of articles published over the years, but I did not want any changes or edits to this one. Hence, the blog article and the blog. 🙂
See https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/
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DON’T BE A PHILISTINE
It very doubtful that Russia will be “dismembered” by China. Historically, these two countries have been adversaries, but thanks to President Obama’s foreign policies, China and Russia now have become business partners. They signed a long term oil and gas contract to deliver Russian oil and gas to China.
China is locking-in future energy supplies wherever they are found ( Russia, Africa, Iran, etc.) They also signed swap agreements in conjunction with Brazil, Iran, China, and a growing list of other countries not to accept U.S. Dollars for oil or for other products (exports). They don’t need to hold U.S. Dollars in reserve as much and will use Renumbi instead.
Oh, the Chinese are currently configuring their military to attack the United States. Russia may join them the next time we are careless enough to berth all our aircraft carriers in one place again ( Norfork, Va). We laughed-off the risk this time. Well, that is pretty foolish. Look at how that worked out in military history.
The Romans thought nobody would attack Rome through a thick swap in the nearby lowlands. Guess what? Hannibal did so and caught the Romans by surprise and defeated them at home. Hannibal destroyed the Roman Army and 80 senators in the Battle of Canne in 215 B.C. It was the worst defeat in the history of the Roman Empire in their home turf. Historians write Hannibal suffered a mosquito bite right in the eye that caused him to go blind in one eye as a result of his tactics. He was brilliant.
The French (our current idol ) also fell to the hazards of overconfidence, arrogance, and group complacency. The French believed that the Germans would not be able to bypass the Maginot Line. Guess what? The shelled the Maginot line and maneuvered their Panzers around its end (flank) and captured Paris. Germany ruled all of France with only 2,000 Gestapo Officers and many French collaborators (traitors).
My favorite example of heroism under fire by a true underdog against a seemingly superior foe was David. David was only a sheepherder ( “a boy”). However, he had honed his skills using a sling-shot for many years in the field tending his sheep and protecting them from predators (wolves). David slew Goliath the Philistine with one rock and beheaded him on the spot. End of the Philistines, without their leader they were routed. So, we should not be so cocky or over confident. Instead, be humble. Don’t be a Philistine!
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China apparently has its sights on at least Siberia; and in the post-Putin era, why should the United States care?
China’s deals with Russia are one-sided, to the benefit of China. As Putin’s days end, he is likely to agree to similar deals that ostensibly make him look good, but are really a sell-out vis-à-vis the Russian people.
You concluded by saying:
I agree with you. The future is fraught with problems and challenges, which my articles underscore. However, we will fare better than others, or so I believe.
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OBAMA BOUGHT, NOT “SOLD”
Oh, despite our history of structured (responsible) immigration and full assimilation, today’s immigrants are often refusing to fully assimilate. That’s why DMV publications come in six written languages. Nice try Tim . President Obama was not “sold” to the people. Rather, the voters “bought” Obama, TWICE !!
Blaming it on how Obama was “marketed” to the voters is a nice, convenient excuse to avoid shared responsibility and blame for poor collective choices by arguably stupid voters. Voters remain stupid and they do not like Republicans that much either. They just did not like the Democrats either, even less at this time. .
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A 1930s-Style Depression [UPDATED]
In an article entitled, “Bank of America sees $50 oil as Opec dies,” the UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, has written:
See http://www.telegraph.co.uk/finance/oilprices/11283875/Bank-of-America-sees-50-oil-as-Opec-dies.html; see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-5264 (the “Global Meltdown”) and http://www.telegraph.co.uk/finance/markets/marketreport/11289475/UK-stocks-head-for-worst-weekly-rout-since-2012-on-economy-fears.html (“UK stocks suffer worst weekly rout since 2011″—”[M]ore than £100bn wiped off the value of Britain’s biggest companies after investors took fright at signs of a Chinese slowdown, the oil rout and looming elections in Greece, plunging global stock markets into turmoil”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-6526 (“The End of China’s Economic Miracle”) and http://www.telegraph.co.uk/finance/economics/11301059/How-the-world-fell-back-into-economic-meltdown-2014-in-charts.html (“How the world fell back into economic meltdown: 2014 in charts“) and http://www.telegraph.co.uk/finance/economics/11379000/Eurozone-hit-by-record-deflation-in-January.html (“Eurozone heads towards ‘protracted’ deflation as bloc hit by record price drop“) and http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/11450691/Liquidity-evaporates-in-China-as-fiscal-cliff-nears.html (“Liquidity evaporates in China as ‘fiscal cliff’ nears“) and http://www.telegraph.co.uk/finance/economics/11447805/Eurozone-faces-first-regional-bankruptcy-as-debt-debacle-stalks-Austrias-Carinthia.html (“Eurozone faces first regional bankruptcy“) and http://www.telegraph.co.uk/finance/comment/jeremy-warner/11455671/Austria-is-fast-becoming-Europes-latest-debt-nightmare.html (“Austria is fast becoming Europe’s latest debt nightmare“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7170 (“The Coming Chinese Crack-Up“)
Hold on tight. Things will get very ugly and scary globally between now and the end of this decade.
. . .
For Putin’s Russia, the effects will be especially dramatic.
Putin is not long for this world. The countdown has begun.
See https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-6595 (“Russia Is Collapsing, And Putin’s Days Are Numbered”) and https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-6819 (“Putin’s Final Days?“) and https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-7157 (“Putin’s Culture Of Fear and Death“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7208 (“The World’s Next Credit Crunch Could Make 2008 Look Like A Hiccup“)
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As far as the imminent demise of Putin, well, what comes next may be even worse than Putin. More likely along NAZI lines. That would be more threatening to Europe than what we currently have. So, be careful what you wish for.
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Thank you again, Craig.
However, Putin has had much broader designs.
See, e.g., https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-5521 (“U.S. Military Chief Compares Putin’s Ukraine Move to Stalin’s Invasion of Poland”)
Thus far, the sanctions and decline of oil prices have thwarted him. Because he cannot resuscitate Russia’s collapsing economy, he may still embark on dangerous actions to save his own life—which would seal his fate once and for all.
See https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-6595 (“Russia Is Collapsing, And Putin’s Days Are Numbered”)
The West has made it clear already that to “walk back” the actions he has taken, he must end his support for the so-called “separatists” in Ukraine and withdraw completely from the Crimea. Even that may not be enough to save him; and he is likely to face the cruel fate of Mussolini.
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Russia Faces Perfect Storm As Reserves Vanish And Derivatives Flash Default Warnings [UPDATED]
This is the title of an article by the UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, who has written:
See http://www.telegraph.co.uk/finance/economics/11328974/Russia-faces-perfect-storm-as-reserves-vanish-and-derivates-flash-default-warnings.html (charts omitted; emphasis added); see also https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-6819 (“Putin’s Final Days?“) and https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-6595 (“Russia Is Collapsing, And Putin’s Days Are Numbered“) and https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-7049 (“Litvinenko Tape Points Finger At Putin, While America Provides Proof“) and http://apnews.myway.com/article/20150123/eu–russia-economy-2fbca2ea04.html (“Russia’s foreign currency reserves shrank by 2 percent last week alone to $379 billion as the Central Bank sold foreign currency in a bid to prop up the ruble”)
The collapse of the USSR came swiftly, like the Berlin Wall’s fall and the collapse of Erich Honecker’s government in the DDR (or East Germany)—where Putin served as a KGB operative—and Nicolae Ceaușescu’s brutal regime in Romania. The collapse of Russia is coming too, very fast.
When it is gone, the final phase of the Cold War will have ended. Until then, it will continue unabated. Putin is merely the latest pawn in this struggle.
When he follows in the footsteps of “Il Duce,” or Mussolini, Freedom’s bells will ring around the world and there will be great jubilation!
The sooner he is gone, the better!
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Germany Faces Impossible Choice As Greek Austerity Revolt Spreads
This is the title of an article by the UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, who has written:
See http://www.telegraph.co.uk/finance/economics/11407256/Germany-faces-impossible-choice-as-Greek-austerity-revolt-spreads.html
The storm clouds have been gathering for a long time now. An economic explosion of epic proportions may be in the cards, sooner rather than later.
See also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-6670 (“A 1930s-Style Depression“)
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The Coming Chinese Crack-Up [UPDATED]
David Shambaugh, director of the China Policy Program at Washington, D.C.’s George Washington University, has written in the Wall Street Journal:
See http://www.wsj.com/articles/the-coming-chinese-crack-up-1425659198?mod=WSJ_hpp_MIDDLENexttoWhatsNewsForth (emphasis added); but see http://www.bloomberg.com/news/articles/2015-06-25/with-21-trillion-china-s-savers-are-set-to-change-the-world (“With $21 Trillion, China’s Savers Are Set to Change the World“); see also https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/#comment-6527 (“The End of China’s Economic Miracle“) and http://www.telegraph.co.uk/finance/china-business/11701472/Rats-leaving-a-sinking-ship-as-Chinas-equity-bubble-implodes.html (“‘Rats leaving a sinking ship’ as China’s equity bubble implodes”) and http://www.independent.co.uk/news/business/news/bear-market-grips-chinese-stocks-as-investor-panic-grows-10354182.html (“Bear market grips Chinese stocks as investor panic grows“) and http://www.wsj.com/articles/how-chinese-stocks-fell-to-earth-my-hairdresser-said-it-was-a-bull-market-1436165508 (“How Chinese Stocks Fell to Earth: ‘My Hairdresser Said It Was a Bull Market’”) and http://www.wsj.com/articles/chinas-stock-plunge-is-scarier-than-greecechinas-stock-plunge-is-scarier-than-greece-1436309780 (“China’s Stock Plunge Is Scarier Than Greece“) and http://www.telegraph.co.uk/finance/china-business/11725236/The-really-worrying-financial-crisis-is-happening-in-China-not-Greece.html (“The really worrying financial crisis is happening in China, not Greece“) and http://www.wsj.com/articles/lessons-of-chinas-crash-1436385994 (“Lessons of China’s Crash“)
As the author points out, the Soviet Union’s collapse came very fast; and the collapse of Putin and Russia, which are far weaker than the former USSR, is coming even faster.
Both the murderous Putin and Russia are in a death spiral that they will not survive. The economic sanctions imposed by Barack Obama, and the fall of oil prices, have been devastating Russia.
Ukraine may become “Afghanistan II”—the burial ground of Putin’s dreams of the USSR being resurrected. Russians have been leaving in body bags already, which may only increase.
See https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-7486 (“Putin Meets Economic Collapse With Purges, Broken Promises“) and https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-7387 (“The Corruption And Criminality Of The Putin Regime“) and https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-7157 (“Putin’s Culture Of Fear and Death“)
China has great potential; and the opportunities for shared economic and other progress with the United States are enormous. The Chinese leadership must not fritter away such a relationship. It can be win-win for both sides, stretching well into this century.
As the Middle East continues to implode, and as the United States becomes the dominant energy producer in the world once again—and energy independent—China may find that it needs American energy products desperately.
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7283 (“US To Launch Blitz Of Gas Exports, Eyes Global Energy Dominance“)
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RUSSIAN STOICISM
A Ukrainian friend of mine told me recently that the Russian People are very stoic. The same could be said of Israeli Jews, as well. Americans have not yet had the kind of economic and political hardships needed to develop such stoic attitudes in the general population. I suspect that is going to be changing in the future for America. When we are all 20 years older, we will all be stoics. Its only beginning for us.
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Thank you, Craig, for your comments as always.
First, the United States will fare better economically than other countries in the world. Russia may collapse and be dismembered, with China taking part (e.g., Siberia) and the rest becoming independent states like the former Yugoslavia.
The United States might not object to that, and may in fact encourage it.
Second, Israel has been flourishing economically. However, Netanyahu has done more to fuel anti-Semitism in Europe and around the world, and to increase threats against Jews in Israel and elsewhere, than any Israeli politician since the country’s founding.
See, e.g., https://naegeleblog.wordpress.com/2014/01/06/ariel-sharon-is-missed/#comment-7059 (“Former Mossad Chief: I Don’t Trust Netanyahu, His Actions Will Cost Us”) and https://naegeleblog.wordpress.com/2014/01/06/ariel-sharon-is-missed/#comment-7039 (“Is Night Falling Again For European Jews?“)
He was hated by the Rabins and Sharon; and he is hated by Barack Obama, France’s Hollande and other world leaders.
Whether Israel survives is an open question.
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NO MORE MASSADA ( For Them).
The Survival of the Nation of Israel may be an enduring question for some, perhaps, even a majority of the World ( gentiles), but history proves the Jewish Nation has seen much tougher times and enemies besides Holland or Obama. Today’s politics does not even rate. Its a joke to even discuss it.
They have no alternative but to survive as a sovereign nation by “any and all means possible”. They will act as a unified nation as they see fit and call the shots, if any. All Israeli Nationals have all taken a vow there will never again be another “Massada” or the equivalent. So, You can plan on being fried in a nuclear explosion at home before they allow anyone or anything to destroy or threaten them in their home. The politics of Netanyahu and Obama is a side-show for anyone paying attention.
Most Americans are not too concerned or involved, including Jewish Americans. Its not a concern with anyone I know of. Liberal Israelis don’t like their own conservatives like Netanyahu anymore than ours.
Each individual or country is going to look out for their immediate interests at home or overseas as they see them and “let the chips fall as they may” as a consequence, myself included. I don’t much care what other people think or their politics for that matter. I only care primarily about taking care of ME. All the rest can just sort itself out, accordingly. Priorities.
I don’t care and am not worried about Iran or Israel. Someday there probably will be a World War (III) and it may start in the Middle East. Not much you or anyone else “can do about it” either. Bla, Bla, Bla.
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Thank you again, Craig, for your comments.
First, I do not want this “thread” to get any longer, because those who use smartphones will have difficulty reading it.
Second, as I have stated before:
I was stunned by this person’s words, and I have reflected on them many times since.
I am not convinced that Israel will survive, although I hope it does. I have set forth my beliefs on this subject before.
See https://naegeleblog.wordpress.com/2010/02/20/israels-senseless-killings-and-war-with-iran/#comment-544 (“Why I Write And Say What I Do”)
Third, Israel’s nuclear arsenal is neutralized for all intents and purposes. It would be suicidal to use such weapons, because the currents would carry the radioactive materials over Israel. Also, it has been reported:
See http://www.israelnationalnews.com/News/News.aspx/191966#.VPPMWDrS_O8
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The World’s Next Credit Crunch Could Make 2008 Look Like A Hiccup [UPDATED]
This is the title of an article by Ben Wright in the UK’s Telegraph:
See http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/11490796/The-worlds-next-credit-crunch-could-make-2008-look-like-a-hiccup.html (emphasis added)
Also, the UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, has written:
See http://www.telegraph.co.uk/finance/economics/11492447/Feds-Bullard-sees-roaring-boom-for-US-economy-but-nasty-shock-for-markets.html (“Fed’s Bullard sees roaring boom for US economy, but nasty shock for markets“) (emphasis added; charts omitted); see also http://www.telegraph.co.uk/finance/comment/11492849/Europe-once-more-sleep-walks-towards-the-abyss.html (“Europe once more sleep walks towards the abyss”—”Europeans are deluding themselves”—”[T]he single currency is once again tearing Europe apart”) and http://www.businessinsider.com/half-of-america-doesnt-save-any-money-2015-3 (Half of American households live from paycheck to paycheck—”People who don’t save won’t have any buffer should the economy turn and they lose their jobs. Longer term, people who don’t save won’t have the capacity to retire”) and http://cnsnews.com/news/article/ali-meyer/americans-not-labor-force-exceed-93-million-first-time-627-labor-force (“Americans Not in Labor Force Exceed 93 Million for First Time“) and http://cnsnews.com/news/article/ali-meyer/record-12202000-black-americans-not-labor-force (“Record 12,202,000 Black Americans Not in Labor Force“) and http://www.breitbart.com/big-government/2015/04/03/56131000-women-arent-in-the-labor-force-a-record-high/ (“56,131,000 [AMERICAN] WOMEN AREN’T IN THE LABOR FORCE, A RECORD HIGH“) and http://www.telegraph.co.uk/finance/economics/11535849/IMF-fears-cascade-of-woes-as-Fed-crunch-nears.html (“Dollar shock looms for emerging markets as Fed poised to raise rates much more sharply than markets expect”—”India will overtake China in 2015 for the first time in modern memory”) and http://www.telegraph.co.uk/finance/economics/11538509/IMF-tells-regulators-to-brace-for-global-liquidity-shock.html (“IMF tells regulators to brace for global ‘liquidity shock’“) and http://www.reuters.com/article/2015/04/14/us-usa-fed-disaster-idUSKBN0N528G20150414?irpc=932 (“Wary of natural disaster, NY Fed bulks up in Chicago“) and http://www.telegraph.co.uk/finance/comment/jeremy-warner/11569329/Jeremy-Warner-Negative-interest-rates-put-world-on-course-for-biggest-mass-default-in-history.html (“Negative interest rates put world on course for biggest mass default in history”—”It’s a bubble that is bound to end badly”—”[F]ar from being a welcome sign of returning economic confidence, this almost surreal state of affairs actually signals the very reverse. How did we get here, and what does it mean for the future? Whichever way you come at it, the answer to this second question is not good, not good at all”—”Eventually, there will be a massive correction, in which creditors will suffer sickening losses. Nobody can tell you when that moment will arrive”) and http://www.telegraph.co.uk/finance/economics/11590314/Violents-bond-moves-signal-tectonic-shifts-in-global-markets.html (“Violent bond moves signal tectonic shifts in global markets”—”‘It is absolute pandemonium in the fixed income markets. Everybody has been trying to get out at the same time but the door is getting smaller,’ says RBS”—”A wave of turmoil is sweeping through sovereign bond markets, setting off the most dramatic gyrations seen in recent years and threatening to spill over into over-heated equity markets”) and http://www.wsj.com/articles/indian-rupee-weakens-to-20-month-low-1431004842 (“Indian Rupee Weakens to 20-Month Low”) and http://www.zerohedge.com/news/2015-05-08/americans-not-labor-force-rise-record-93194000 (“Americans Not In The Labor Force Rise To Record 93,194,000“) and http://variety.com/2015/film/news/cannes-film-festival-market-currency-crisis-1201492761/ (“Cannes’ Money Problems: Plunging Euro Leaves a Cloud Over Market”—”[T]here’s an ominous cloud hanging over this year’s market: the currency crisis in Europe and Russia”—”Japan is not good. Russia is at zero because of the ruble. Europe is bad”—”The Euro has steadily fallen in value against the dollar, and the ruble went into free-fall last year”) and http://www.bloomberg.com/news/articles/2015-05-18/bank-of-america-markets-are-in-a-twilight-zone-and-it-s-time-to-hold-more-cash-and-gold (“Bank of America: Markets Are in a ‘Twilight Zone’ and It’s Time to Hold More Cash and Gold”) and http://www.ft.com/intl/cms/s/0/6d3c5b30-fc38-11e4-ad3f-00144feabdc0.html#axzz3aXe2WFPs (“Finance chiefs urge action on bubble fear”) and http://www.telegraph.co.uk/finance/economics/11625098/HSBC-fears-world-recession-with-no-lifeboats-left.html (“HSBC fears world recession with no lifeboats left”—”The world authorities have run out of ammunition . . . They have no margin for error as economy falters”—”[T]he global authorities have alarmingly few tools to combat the next crunch”—”Russia, Brazil, Argentina, and Venezuela are all contracting sharply, casualties of the China-driven commodity bust”) and http://www.telegraph.co.uk/finance/economics/11637086/ECB-fears-abrupt-reversal-for-global-assets-on-Fed-tightening.html (“ECB: world markets in ‘fragile’ balance”—”Investment funds have grown by 120pc to €9.4 trillion with a pervasive ‘liquidity mismatch’, investing in sticky assets across the globe while allowing clients to withdraw their money at short notice. This is a recipe for trouble in bouts of stress. ‘Large-scale outflows cannot be ruled out'”—”The ECB warned that a rush for crowded exits could set off a wave of forced selling and quickly spin out of control. ‘Initial asset price adjustments would be amplified, triggering further redemptions and margin calls, thereby fueling such negative liquidity spirals,’ it said”) and 6,652,000: More Americans Working Part-Time, But Not by Choice (“6,652,000: More Americans Working Part-Time, But Not by Choice”) and New Housing Crisis Looms as Fewer Renters Can Afford to Own (“New Housing Crisis Looms as Fewer Renters Can Afford to Own”—”Policy makers in Washington appear either unaware or unwilling to do much about it”—”[H]omeownership will continue to slip for at least the next 15 years”—”If renters can’t ever become homeowners, who will buy those homes when today’s homeowners need to sell?”) and http://www.wsj.com/articles/dow-theory-has-investors-skittish-on-markets-next-leg-1433713438 (“Dow Theory Has Investors Skittish on Market’s Next Leg“) and http://www.wsj.com/articles/emerging-markets-face-largest-outflow-in-seven-years-1434096125 (“Emerging Markets Suffer Largest Outflow in Seven Years”—”Global investors have yanked $9.3 billion from stocks in developing countries in the week to Wednesday, the most since the depths of the global financial crisis in 2008″—”Massive outflows from China have contributed to the selling in Asia and come in the wake of increased volatility in the domestic market”) and http://www.cnbc.com/id/102760074 (“Fed’s worst nightmare: The ‘ghost of 1937′”—”[T]he specter of 1937, when the Fed raised rates prematurely and exacerbated the Great Depression”—”‘The longer the Fed stays on this path, the more aggressively it may have to tighten and the crueler the asset price adjustment will be when it finally comes'”—”[T]he Fed has never been down the easing road quite this far. . . . Consequently, the escape route is going to be bumpy. The best investors likely can hope for is that it’s not as bad as other times in the past”) and http://www.usnews.com/news/blogs/ken-walshs-washington/2015/06/17/americans-have-lost-confidence-in-everything (“Americans Have Lost Confidence … in Everything”—”Americans have little confidence in most of their major institutions including Congress, the presidency, the Supreme Court, banks and organized religion, according to the latest Gallup poll”—”Only the military, in which 72 percent of Americans express confidence, up from a historical average of 68 percent, and small business, with 67 percent confidence, up from 63, are currently rated higher than their historical norms”—”All in all, it’s a picture of a nation discouraged about its present and worried about its future, and highly doubtful that its institutions can pull America out of its trough”) and http://www.telegraph.co.uk/finance/personalfinance/investing/11686199/Its-time-to-hold-physical-cash-says-one-of-Britains-most-senior-fund-managers.html (“It’s time to hold physical cash”—”The manager of one of Britain’s biggest bond funds has urged investors to keep cash under the mattress”) and http://www.washingtonexaminer.com/poll-72-fear-economic-crash-concern-highest-ever/article/2567095 (“Poll: 72% fear economic crash, concern ‘highest ever'”) and https://ca.news.yahoo.com/quartet-crises-threatens-europes-core-080943887–business.html (“Quartet of crises threatens Europe’s core”) and https://naegeleblog.wordpress.com/2011/07/29/are-colleges-dinosaurs/#comment-7616 (“Grad-School Loan Binge Increases Debt Worries“)
These articles, and their conclusions, are consistent with the article and comments above.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7170 (“The Coming Chinese Crack-Up“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-6670 (“A 1930s-Style Depression“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-6987 (“Russia Faces Perfect Storm As Reserves Vanish And Derivatives Flash Default Warnings”)
The United States will fare better than other countries, inter alia, because of our oil and energy independence.
See, e.g., http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/11553769/BP-sees-massive-shock-for-North-Sea-as-oil-glut-deepens.html (“[Bob Dudley, chief executive of the oil giant BP] said there is little chance of a revival in crude prices for a long time given the ‘remarkable resilience’ of US shale producers, who have defied predictions of collapse and continue to drill record volumes”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7283 (“US To Launch Blitz Of Gas Exports, Eyes Global Energy Dominance“)
Almost anything could trigger a crisis in today’s environment globally.
However, one of the greatest risks that has been perceived in Washington for many years is that a run would begin on the funds, which the central banks would be helpless to quell, leading to a liquidity crisis of unfathomable proportions.
The Depression-era tools and “safety nets” would prove useless, and panics would ensue.
Unlike American bank deposits that are insured by the FDIC, the funds are not insured at all.
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The Environmental Nazis Are At It Again [UPDATED]
I am a hiker, and I love the environment, and always have, probably since I was a Boy Scout. I am a fisherman too, and have done that for many years, in tournaments and otherwise. Thankfully, lots of the tournaments today are “catch-and-release” tourneys, where the fish are returned to nature.
The Washington Times has an important article about the water shortage in California, for which the “environmental Nazis” are responsible in large part:
See http://www.washingtontimes.com/news/2015/apr/13/jerry-brown-california-drought-water-conservation-/ (emphasis added); see also http://www.wsj.com/articles/california-faces-lost-decades-in-solving-drought-1451002429 (“California Faces Lost Decades in Solving Drought”—”[S]tate and federal officials haven’t significantly upgraded California’s water infrastructure in decades”—”Since the last major state or federal dam was completed in 1979, California’s population has grown to 39 million people from 23 million”—”[T]he earthen levees that line many of the [California D]elta tributaries could fail to due to sea level rise or a severe storm, cutting off a significant part of California’s water supply for months”)
First, the 2007 ruling by the federal judge is not surprising. Judges are imperfect at best—and often egotistical, callous, mean-spirited, power-hungry, self-righteous, condescending and, yes, incompetent and arrogant.
See https://naegeleblog.wordpress.com/2013/07/15/justice-and-the-law-do-not-mix/ (“Justice And The Law Do Not Mix”)
Second, many of the same “environmental Nazis” who have been pushing the man-made “global warming” fraud are involved here too.
Our planet goes through natural cycles, of warming and cooling. It always has. The same is true of California’s periodic droughts.
Man-made “global warming” is a hoax, and “The Great Green Con.”
Like Obamacare, it is simply another Leftist aka “Progressive” attempt to control people and their lives, and a path toward global government.
In another time, the proponents of “global warming” would have been members of the “Flat Earth Society,” and claimed a “consensus” with respect to that too.
See https://naegeleblog.wordpress.com/2015/11/30/a-34-trillion-swindle-the-shame-of-global-warming/ (“A $34 Trillion Swindle: The Shame Of Global Warming“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3036 (“The Global Warming Hoax, And The Great Green Con, Revisited“)
This situation will only get far worse as the U.S. and global economies go into a tailspin, and there are no monies to remedy these problems.
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7614 (“Doomsday Clock For Global Market Crash Strikes One Minute To Midnight As Central Banks Lose Control“)
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Voters may indeed have a tough time “swallowing” higher water bills and more restrictions, but they really have no alternative at this point. If you wait until you have a crisis, then its usually too late to do much about it but react. Calif., as well as most other Democratic governments, are entirely reactive. Politicians follow the crowd, not lead it, and in Calif. in particular, the crowd is pretty dumb. They don’t care about water, just so they have what they need.
Well, I grew up here and nothing has changed but the state’s population. Its more than doubled since I graduated from High School in 1973. Unfortunately, the amount of water that is stored is not much different in many locations. So, an imbalance between supply and demand exists most of the time. The best solution would be for people to leave and thus restore some measure of balance.
I think the Big One, ( a major earthquake) would do the job. If man can not manage his resources to sustainable levels then nature will eventually do it for him. I vote for nature. A big earthquake would restore balance in real time too. Looking forward for a Level 8 on the Richter scale when it rips. Yahoo!!
Good movie in May about Calif. and San Andreas called:
Watch the Movie Preview and see what it might be like
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Thank you, Craig, for your comments as always.
Draconian measures by the State of California may be met with resistance if not outright rebellion by Californians.
The State has gone through droughts and droughts and droughts. Nothing seems to be learned from them. Santa Barbara built a desalinization plant that was “moth-balled” when the rains came again.
The best solution seems to be the capture of water when the rains come again, through the building of more dams. Environmental “Nazis” will scream, but so what.
I agree with your comment:
You added:
Those who leave are replaced by those who come, inter alia, because of the weather.
Next, you said:
There is no question that the “Big One” is coming. The only question is when.
See https://naegeleblog.wordpress.com/2010/09/08/earthquakes-the-big-one-is-coming-to-at-least-los-angeles/ (“Earthquakes: The Big One Is Coming To At Least Los Angeles”) and https://naegeleblog.wordpress.com/2010/09/08/earthquakes-the-big-one-is-coming-to-at-least-los-angeles/#comment-1999 (“The Big One“)
Americans must realize, however, that there are serious fault lines elsewhere in the country, such as the “New Madrid Fault Line” under the St. Louis area.
Yes, the United States and other countries have more stringent building codes today. However, will they really make any difference? For example, high-rise office buildings were damaged in the Northridge Quake that struck Southern California in 1994; and instead of fixing them at enormous costs (e.g., tenants needed to vacate the buildings), the damage was swept under the rug.
The chickens may come home to roost in spades; and liquefaction may occur in areas such as Los Angeles’ Marina del Rey harbor, where high-rise buildings may literally collapse.
Lastly, with respect to the movie clip, it might have been from New York City on 9/11.
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Tim, you have actually given my argument additional support and validation. You see, we have been here before in so many ways. Its just today’s voters are “New”, that is they were not yet born ( even conceived) when Jerry Brown was governor in the 1970’s and Jimmy Carter was President of the U.S. and Iran fell to the Ayatollah Khomeini. Either that, or many of today’s Californians were not residents back in the 1970’s. I was.
Voters did “rebel” after Jimmy Carter and Jerry Brown by electing President Ronald Reagan and Gov. Dukemajian, two Republicans with “cajoles”. T.V. ads in 1980 said: ” If its Brown, Wipe It”. Political cycles Repeat. Still, the trends continued on nevertheless and here we are.
No new Federal Water projects and more people moving to Calif. EVERY Year until the first Bush Recession in 1990. Then with the Aerospace and Defense Dept. cutbacks, people finally began to leave Calif for Utah, Colorado, Idaho. Wash. and Oregon. People are still leaving, but Mexicans still come here because its still wetter than Tijuana.
The way I see it, communities like Carlsbad, CA with sufficient foresight, leadership, informed and intelligent homeowners and local voters, and sufficient means can fend for themselves and improve their water equation.
For example, completion is near for the $1 billion Carlsbad Desalination Project that is expected to supply 7 to 10 percent of San Diego County’s drinking water by the end of this year ( Sept). It produces 50 Million Gallons of water a year, or enough for 300,000 residents. So, residents of Carlsbad have it made. Local residents and politicians “grabbed the bull by the horns” and now they have filtered, drinkable water.
Other less endowed communities in Calif. ( less money and less brains) will have to make do with periodic rationing or whatever the state orders them to do, like we have up to now. Glendale or L.A. have done very little to add capacity and are forced to cut back according to orders from the Calif. Water Resources Board and Gov. Brown. That’s the way it goes. Some have it, others do not. That won’t change in the future no matter who is elected Gov.
If we get mandatory statewide water rationing in the future of say 60 gallons per day per household, then I would just go out and turn-off the city water meter and order up Sparkletts for my daily drinking water needs. It would be tough in any event, but at least I could use my private water the way I want and can ignore the State and City. In the process, they would get 0 dollars revenue from me.
Public Water Supplies should be partially privatized anyway, as the State and City Governments have done a Terrible job managing our state water resources for decades anyway. Its really the only conceivable policy solution I can imagine, other than the Big One ( San Andreas). Again, I vote for Nature’s solution as versus political solutions. They are too “messy”.
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There is only one thing you may have missed, Craig.
The Leftists/so-called “progressives”/environmental “Nazis” who run California and who have caused so many of these problems, may decide that Carlsbad’s water must be used to help the State’s overall water problems, and cannot be used to help Carlsbad alone.
Read or reread George Orwell’s “Animal Farm.” 🙂
P.S. Please include any further comments after your next comments below, so that this thread does not become unreadable for smartphone users.
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FEDERAL DAM BUSTERS
The last attempt at constructing a new dam with Federal money by the Corps of Engineers in the U.S. was Elk Creek Dam in Southern Oregon in the early 1980’s. It was ordered demolished after being 1/2 completed due to environmental challenges.
Trojan Nuclear Plant on the Columbia River (WA) was also imploded in the 1980’s. Hanford Nuclear plants were decommissioned in Eastern Washington. We brought out the wrecking-ball to water power projects. Think it was just coincidence or policy? One thing is for sure, it was no accident then or now.
No new federal water resource projects have been approved since then in any state to my knowledge. So, its not likely to change no matter how severe the drought or future droughts. We just have to get by on less water and pay more for food grown with irrigation for the most part. No alternative is the way it is.
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Thank you again, Craig. I was not aware of that.
The “environmental Nazis” have struck again and again. If they could, they would turn the clock back in this country at least a century.
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US To Launch Blitz Of Gas Exports, Eyes Global Energy Dominance [UPDATED]
The UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, has written:
See http://www.telegraph.co.uk/finance/newsbysector/energy/11563761/US-to-launch-blitz-of-gas-exports-eyes-global-energy-dominance.html (emphasis added; charts omitted); see also http://www.washingtontimes.com/news/2015/may/10/stephen-moore-green-energy-movement-dies-failed-to/?page=all (“Promoters of renewable energy failed to account for the return of cheap oil“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7356 (“The Global Green Energy Fad“) and http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/11638709/Opec-under-siege-as-Isil-threatens-worlds-oil-lifeline.html (“Opec under siege as Isil threatens world’s oil lifeline”—”Should Isil capture a major oil field in Iraq, or overwhelming the government, the consequences for energy markets and the financial system would be potentially catastrophic”—”[T]he biggest threat to oil prices is the political chaos that threatens to engulf the Middle East, combined with the West’s reluctance to intervene”) and The EPA Fracking Miracle (“The EPA Fracking Miracle”—”[E]ven the Environmental Protection Agency now concedes that fracking is safe”) and http://www.wsj.com/articles/oil-tankers-are-filling-up-and-raking-it-in-1435273625 (“Oil Tankers Are Filling Up and Raking It In”—”Oil producers and traders are rushing to lease tankers while they scramble to find buyers, effectively turning these ships into floating storage facilities”—”U.S. refiners are running near maximum capacity to produce gasoline for drivers who are hitting the road for summer vacation. And China, the world’s largest oil consumer after the U.S., has been stockpiling crude for its strategic reserves”) and http://www.telegraph.co.uk/finance/oilprices/11768136/Saudi-Arabia-may-go-broke-before-the-US-oil-industry-buckles.html (“It is too late for OPEC to stop the shale revolution. The cartel faces the prospect of surging US output whenever oil prices rise”) and http://www.wsj.com/articles/move-to-allow-u-s-oil-exports-accelerates-1439143950 (“Move to Allow U.S. Oil Exports Accelerates“) and http://www.wsj.com/articles/oil-futures-signal-weak-prices-could-last-years-1439159387 (“Oil Futures Signal Weak Prices Could Last Years“) and http://www.wsj.com/articles/u-s-approves-limited-crude-oil-trade-to-mexico-1439570613 (“U.S. Loosens Longtime Ban on Oil Exports“) and http://www.telegraph.co.uk/finance/economics/11989469/Saudi-Arabia-risks-destroying-Opec-and-feeding-the-Isis-monster.html (Will Saudi Arabia be hoisted by its own petard?) and http://www.wsj.com/articles/u-s-exports-first-freely-traded-oil-in-40-years-1452643962 (“U.S. Exports First Freely Traded Oil in 40 Years“) and http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/12118594/Saudis-will-not-destroy-the-US-shale-industry.html (“Saudis ‘will not destroy the US shale industry’”—”America’s tight oil production will rebound as soon as prices start to recover”—”[I]t is impossible for OPEC to knock out the US shale industry though a war of attrition even if large numbers of frackers fall by the wayside over coming months”—”[G]roups with deep pockets such as Blackstone and Carlyle will take over the infrastructure when the distressed assets are cheap enough, and bide their time until the oil cycle turns”—”‘It takes $10bn and five to ten years to launch a deep-water project. It takes $10m and just 20 days to drill for shale'”—”‘Shale has proven much more resilient than people thought. They imagined that if prices fell below $70 a barrel, these drillers would go out of business. They didn’t realize that shale is mid-cost, and not high cost'”—”[E]ven if scores of US drillers go bust, the industry will live on, and a quantum leap in technology has changed the cost structure irreversibly. Output per rig has soared fourfold since 2009. It is now standard to drill multiples wells from the same site, and data analytics promise yet another leap foward in yields”—”US shale has entirely changed the balance of power in the global oil market and there is little Opec can do about it”)
In the process of achieving global energy dominance, the United States must finish what Ronald Reagan and George H.W. Bush put into place; namely, ending the Cold War once and for all, and burying the murderous Putin.
He must suffer a fate far worse than that of Mussolini; and Russia may be dismembered in the process, with China taking Siberia—with American blessings.
Putin and Russia are in a death spiral, which must continue.
See https://naegeleblog.wordpress.com/2015/11/29/the-death-of-putin-and-russia-the-final-chapter-of-the-cold-war/ (“The Death Of Putin And Russia: The Final Chapter Of The Cold War“) and https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-7795 (“Russians to Putin: We Will Not Forget Stalin’s Crimes“) and https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-7157 (“Putin’s Culture Of Fear and Death“) and http://www.bloomberg.com/news/articles/2015-06-10/u-s-ousts-russia-as-world-s-top-oil-gas-producer-in-bp-report (“U.S. Ousts Russia as Top World Oil, Gas Producer”—”The data showing the U.S.’s emergence as the top driller confirms a trend that’s helped the world’s largest economy reduce imports, caused a slump in global energy prices and shifted the country’s foreign policy priorities”—”[The U.S.] produced about 90 percent of the energy it consumed last year”—”Growth in some of China’s most energy-intensive sectors, such as steel, iron and cement — which had thrived during China’s rapid industrialization — virtually collapsed in 2014”) and http://www.telegraph.co.uk/finance/economics/11929969/Rouble-strengthens-as-Russia-forces-exporters-to-dump-foreign-cash-reserves.html (“Russia abandons hope of oil price recovery and turns to the plough”—”Russia has abandoned hopes for a lasting recovery in oil prices, bracing for a new era of abundant crude as US shale production transforms the global energy market”—”Oil and gas taxes make up half the state’s revenue, and almost 70pc of Russia’s exports”—”[T]he ‘game changer’ is US shale that has displaced Saudi Arabia as the fundamental price-setter for the world”) and http://www.telegraph.co.uk/finance/economics/11937348/Russia-retreats-to-autarky-as-poverty-looms.html (“Russia retreats to autarky as poverty looms”—”Vladimir Putin is falling back on Soviet-era self-reliance as oil wealth evaporates and sanctions cut off vitally-needed technology”—”Russia is running out of money. President Vladimir Putin is taking a strategic gamble, depleting the Kremlin’s last reserve funds to cover the budget and to pay for an escalating war in Syria at the same time”—”Deficits on this scale are manageable for rich economies with deep capital markets. It is another story for Russia in the midst of a commodity slump and a geopolitical showdown with the West. Oil and gas revenues cover half the budget”—”[T]he Kremlin has no means of raising large loans to ride out the oil bust”—”[T]he latest efforts to squeeze more money out of Russia’s energy companies [is] the ‘end of the road’”—”Russia is . . . risking the sort of military overstretch that bankrupted the Soviet Union”—”Putin knows he cannot count on oil and gas any longer, belatedly recognizing that shale technology in the US threatens to cap crude prices for a decade or more, and has effectively destroyed Russia’s petro-power business model”—”Many of the best engineers and technicians have emigrated in a chronic brain-drain”)
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The Global Green Energy Fad [UPDATED]
[Birds killed by wind turbines]
In a Washington Times article by Stephen Moore, distinguished visiting fellow at The Heritage Foundation—which is entitled, “Promoters of Renewable Energy Failed to Account for the Return of Cheap Oil”—it must be noted:
See http://www.washingtontimes.com/news/2015/may/10/stephen-moore-green-energy-movement-dies-failed-to/?page=all (emphasis added); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7283 (“US To Launch Blitz Of Gas Exports, Eyes Global Energy Dominance“) and https://naegeleblog.wordpress.com/2015/11/30/a-34-trillion-swindle-the-shame-of-global-warming/ (“A $34 Trillion Swindle: The Shame Of Global Warming“)
Many of the same “environmental Nazis” who have promoted the man-made “global warming” hoax have also promoted the “green energy” fad.
In another time, the proponents of “global warming” and the “green energy” fad would have been members of the “Flat Earth Society,” and claimed a “consensus” with respect to them too.
See http://en.wikipedia.org/wiki/Animal_Farm; see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3036 (“The Global Warming Hoax, And The Great Green Con, Revisited“) and http://www.wsj.com/articles/high-tech-solar-projects-fail-to-deliver-1434138485 (“High-Tech Solar Projects Fail to Deliver”—”[A] series of missteps and technical difficulties threatens to make newfangled solar-thermal technology obsolete”—”[T]he power plant requires far more steam to run smoothly and efficiently than originally thought. . . . Instead of ramping up the plant each day before sunrise by burning one hour’s worth of natural gas to generate steam, Ivanpah needs more than four times that much help from fossil fuels to get the plant humming every morning”—”Once built, U.S. government biologists found the plant’s superheated mirrors were killing birds. In April, biologists working for the state estimated that 3,500 birds died at Ivanpah in the span of a year, many of them burned alive while flying through a part of the solar installment where air temperatures can reach 1,000 degrees Fahrenheit”) and http://www.wsj.com/articles/obamas-wind-energy-lobby-gets-blown-away-1439939347 (“Obama’s Wind-Energy Lobby Gets Blown Away”—”A California judge rules in favor of bald eagles”—”Bird kills in general, and eagle kills in particular, are a legal and public-relations nightmare for an industry that promotes itself as ‘green'”—”[W]ind turbines in the U.S. kill some 573,000 birds and 880,000 bats each year”) and http://www.wsj.com/articles/big-solars-subsidy-bubble-1440975764 (“Big Solar’s Subsidy Bubble”—”The Department of Energy’s Inspector General revealed last week that the legendary solar-panel manufacturer Solyndra—a poster baby of the Obama stimulus—lied to the feds to get a $535 million loan guarantee before going bust in 2011″—”[T]he White House is more concerned with boosting the politically favored solar industry than protecting taxpayer dollars. More troubling, the solar industry may be growing too big to fail, and the Administration is assisting another taxpayer solar scam”—”[T]he government-inflated solar bubble could pop if subsidies shrink”) and http://www.wsj.com/articles/californias-climate-change-revolt-1442014369 (“California’s Climate Change Revolt”—”The most morally destructive product in California these days is green government”)
The location of wind farms along pristine, beautiful coastlines constitutes visual pollution at its worst.
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ALTERNATIVE ENERGY PIPE-DREAMS LIVE ON
The allure of “Alternative Energy” (solar and electric cars) has been the desire of so many “star-gazers” and assorted liberal schmucks for as long as I have been alive. Its an old experience with a very long history for this 60-year old retiree anyway. Kind of a bore, at least for those who understand engineering or have a technical background, vs. the masses who are science illiterates.
Solar and other alternatives have always been a universal popular “dream” but have not been economically viable without a lot of subsidizes from the Government, both direct and indirect. Without government money, they are uncompetitive and the market won’t adopt them in great numbers ( at least to count). You can argue the opinion, but not the historical facts.
The L.A. Dept. of Water and Power christened the Solar Farm called ” Solar One” in the Mohave Desert in Oct. 1980. It was the lagging (end) result of the energy crisis in oil throughout the 1970’s under former Democratic President Jimmy Carter. Similarly, in Parachute, Colorado Exxon had the Colony Oil Shale Project funded heavily by the U.S. Synfuels Corporation, another Jimmy Carter Government market distorting scheme.
President Reagan got rid of the Synfuels Corporation and all the Federal subsidizes of oil shale and other alternatives. He also removed the price controls on gasoline imposed by President Jimmy Carter. Soon thereafter, Exxon closed down their facility and locked the gates with no notice. Brown & Root contract employees were headed for the Colorado State Unemployment Dept. line soon thereafter and the era of alternative energy was done, for this cycle anyway. History does often repeat.
At the time of “Black Monday” I was living and working in Rifle, Colorado with the White River National Forest and watched it all happen. Rifle, Colorado went from another energy boom town to a ghost town in short order. “For Sale” Signs sprouted-up in the neighborhood lawns like dandelions in the Spring.
Dean Witter Reynolds in Glenwood Springs ( where I had an IRA account) determined the area was going into a “prolonged recession” and they promptly closed their branch office and moved their brokers to their office in Ft. Collins, Colorado. I have plenty of photographs and negatives in 35 mm from that era to prove it too!
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Thanks Timothy D. Naegele. Some thoughts of mine.
What about that relationship that governs the amount of CO2 that is produced/emitted in an economy during a boom cycle, and that same gas that is emitted during a ‘bust’ cycle.
Is there anywhere, even on this blog, (I have not had time to read all of it.) that acknowledges this obvious relationship? For instance, in Greece, there are allready those who cannot afford to even buy the food that would allow the same to produce methane from a healthy meal.
Why is there no widespread rejoicing amongst the climate intelligensia that this ultimate goal of CO2 emission reduction is being achieved via the global, economic crisis unintentionally perhaps?
Mike
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Thanks, Mike, for your thoughtful comments.
I am not a believer in man-made “global warming,” nor in the “Green Energy Fad,” for reasons that I have stated in comments above.
See, e.g., https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3036 (“The Global Warming Hoax, And The Great Green Con, Revisited“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7356 (“The Global Green Energy Fad”)
Having said that, your conclusion seems to make sense. However, taken to its logical conclusion, there would be no global commerce at all, and we would revert to some form of an agrarian economy of centuries past.
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More Than 100 Newspapers Dumped in Year
With tough economic times ahead, it is arguable that traditional newspapers are dead. Also, the Internet has consigned newspapers to the “horse-and-buggy” era.
An article in the Washington Examiner by Paul Bedard states:
See http://www.washingtonexaminer.com/rip-over-100-newspapers-dumped-in-year-ads-down-50-circulation-hits-bottom/article/2564995?; see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7208 (“The World’s Next Credit Crunch Could Make 2008 Look Like A Hiccup“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1515 (“The Web Is Free!“)
Perhaps the only newspapers that seem to be flourishing are the free throwaways in cities and small towns, which are chock full of advertising.
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What About Gold? [UPDATED]
If the global economy implodes, some people recommend gold as a “hedge.” I still recommend holding cash, and sitting on the sidelines and waiting until the bottom is reached (or close to it), and then snapping up the bargains (e.g., in real estate).
See https://naegeleblog.wordpress.com/2016/01/16/the-obama-great-depression/ (“The Obama Great Depression“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7614 (“Doomsday Clock For Global Market Crash Strikes One Minute To Midnight As Central Banks Lose Control“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7485 (“The World Is Defenseless Against The Next Financial Crisis“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7208 (“The World’s Next Credit Crunch Could Make 2008 Look Like A Hiccup“)
With respect to gold, you can’t eat it. You can’t use it at stores to buy food or anything else that you may need. You may not even be able to get your gold. Will there be a viable market for it?
In a real panic, what will gold be worth to you? Arguably nothing.
For those who argue:
The answer is that Americans and people of other countries understand dollars and smaller U.S. denominations. They will trade in them during the worst of times.
Those who hold gold certificates may find them to be worthless. Also, those who hold gold itself may be robbed, or find it impossible to trade it for anything.
Gold is a “store of value” only if Americans and others recognize it as such. It is not a “currency” at all if you cannot use it to buy food or anything else that you need during panic conditions.
If one or more panics occur, how stable will the markets for gold and silver be? They may be nonexistent—or certainly not a place for “amateurs.”
As I have made it clear in my writings:
See http://seekingalpha.com/instablog/2951-market-shadows/31177-interview-with-timothy-d-naegele (“Interview with Timothy D. Naegele”) (comment beneath article); see also http://www.wsj.com/articles/no-gold-rush-as-greece-and-china-troubles-roil-markets-1436427839 (“No Gold Rush as Greece and China Troubles Roil Markets”) and http://www.wsj.com/articles/gold-continues-sliding-hits-5-year-low-1437368325 (“Gold Continues Sliding, Hits 5-Year Low“) and http://www.telegraph.co.uk/finance/commodities/11752016/Speculators-smash-gold-as-dollar-squeeze-tightens.html (“Speculators smash gold as dollar squeeze tightens“) and http://www.wsj.com/articles/golds-role-as-safe-haven-investment-wanes-1445250762 (“Gold’s Role as Safe-Haven Investment Wanes”—”[M]ore investors grow disillusioned with gold as a haven and turn to alternative safeguards”)
The bottom line: gold may not be a safe haven, certainly in perilous times.
Those who place their trust and faith in gold may find that they are on a fool’s errand.
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WORLD CLASS POKER
China is going to formally apply and the IMF is going to vote on admitting them and the Yuan to their current “basket of currencies”. The Chinese must, prior to the October vote, declare their audited physical gold reserves. This could affect the exchange rates of the currencies, including the U.S. Dollar and possibly the price of gold. Its a ? at this point.
Now, for the purposes of speculation, what might happen if the Chinese declared they have proven gold reserves ( bullion ) of 8,000 metric tons? The U.S. Treasury might still have that much, but we last audited the U.S. Gold reserves back in 1956 during the Eisenhower Administration.
We might not have close to that much gold left on reserve left. So, It all comes down to what the global financial markets believe is true and the confidence they have in the Chinese reserves and currency vs. what the U.S. claims to have. Nobody really believes sovereigns to come clean, so it a high stakes financial poker game: Liar’s Bluff.
Gold is a hedge for those holding large positions in U.S. Treasuries or other dollar denominated bonds. The current rule of thumb is 10% of your bond valuations held in gold. That is what the Chinese have been doing since 2009. That is what I do. You should hedge your bond exposure using gold. Gold is NOT an inflation hedge, despite what “gold bugs” think.
Other precious metals, primarily silver are a good hedge for financial shut-downs or temporary ATM inaccessibility. You need something for barter if you for any reason, are unable to access your cash. True, most Americans have never seen a silver coin ( quarter ) in the entire life and have no idea what it is worth or own ANY silver or gold. We are a paper society and few alive were here when silver was the coinage of America ( 1932-1964).
“Junk Silver” ( U.S. minted quarters and dimes prior to 1964) is good to have as a back-up and a hedge for financial uncertainty. You can exchange it for gas or food with some small independent businesses or grocers. Problem is, most coin dealers are out of stock of “junk” silver since last Sept. You can not get any and if you could find any “junk silver” on- hand; there is currently a 20% premium above spot if you want to take physical delivery of a bag or 1/2 bag..
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Thank you, Craig, for your comments.
Among other things, you have written:
Americans see silver coins almost every day of their lives, certainly when they pay with cash instead of credit or debit cards, and receive dimes and quarters in change.
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“Americans see silver coins almost every day of their lives, certainly when they pay with cash instead of credit or debit cards, and receive dimes and quarters in change”.
REALLY? That’s interesting.
All the quarters I have and as you say, Americans handle small change routinely in everyday retail transactions, are a “sandwich” of copper and nickle or an amalgam of tin/copper. There is currently NO, repeat, NO metallic or elemental Silver ( AG++ on the Periodic Chart of the Elements) found in any general circulation U.S.- Minted Quarters or dimes in general circulation since 1964. Incidentally, since the Marcos Regime, there is very little silver left in Philippine pesos or Mexican pesos either.
I thought everybody knew that. Obviously not. More “low information voters” from Watter’s World on Fox News, I detect here.
U.S. Coins have become even tinnier in the last 12 years, reflecting even less copper in each quarter. You can visibly inspect, unless blind or a blind ideologue who apparently REFUSES to accept our monetary and financial decline when its literally staring you right in the face.
There is no point to carry on anymore conversations Tim, since you have demonstrated a high degree of dis-ingeniousness. This is more than a disagreement of opinion. At the late Senator Patrick Moynihan once famously said to a colleague: “You are entitled to your OWN Opinion, But NOT your own facts”. You are certainly factually wrong about current U.S. Coinage and silver content, as a matter of fact. An apology is certainly due on that basis, Tim. Goodbye.
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You added:
I do not disagree. I have never asserted that they are pure silver.
Also, the late Senator Patrick Moynihan is NOT one of my heroes, nor remotely the “hero” of most Americans. Indeed, there are few alive today who have even heard of him, much less anything that he stood for.
My recollection is that he was a pompous Narcissist, who was enthralled by his own intellect.
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“THE FACTS” AND NOTHING BUT THE FACTS, YOUR HONOR
I know what you wrote and its factually wrong. Today’s quarters and dimes have Zero silver in them and most American’s have been conditioned (brainwashed) to think they still have the same inherent value ( not official value under Public Tender Laws). This also applies to all the other quarters and dimes minted since 1964, as well.
You can not even find any pre-1965 coins, even from precious metals dealers. Most silver coins from that era ( 1931-1964) have already been taken-out of circulation, hoarded by collectors, or melted down. These so-called “junk silver” coins were never 100% silver to begin with. More like 90% at the most. REF:
http://www.coinflation.com/coins/1932-1964-Silver-Washington-Quarter-Value.html
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Fascinating.
To the undiscerning eye, they seem to have a silver facade, with copper sandwiched in the middle.
However, from what you have said—and what my brief research confirms—any U.S. dimes, quarters, half dollars or dollars that are dated later than 1964 are copper-nickel clad coins except for the dual-dated Bicentennial Quarters that were sold by the Mint in special Mint Sets and Proof Sets.
Please start a new thread if you wish to comment further, so smartphone users can read this easily.
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LAWYERLY TACTICS IN RESPONSE
You finessed or walked-around the factual errors of your previous statements regarding the presence of silver in coinage routinely handled by the public, their knowledge of it ( or lack of knowledge), and the referenced link breaking down the metals contained in pre-1965 junk silver coins and their current market value, as well.
The precise technical composition of today’s fake (fiat) coins (sans silver) is really of no particular interest to me at all and was not the main point of my previous string of comments today on this subject. You simply chose to comment on them as a come-back for previous and unadmitted gross factual errors. The Late Senator Moyanhan was Pompous? Try some lawyers and most politicians for a change.
Also, you might investigate the ” Nickle Act” passed a few years ago by Congress which actually removed nickle from our of our nickles. So, although nickles were not previously silver at all, they now may not even be nickle or have, at best less nickle in them.
Either way, we have the indications of a government that is broke and knows it. Eventually, the average Joe on the Street will figure it out. Then we are toast and the U.S. Dollar becomes largely a domestic only currency not accepted for trade outside of the U.S. directly as it currently is. So, Get ready for a big reset soon.
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Just my $0.02 here but where was there a mention of Patrick Moynihan as being ANYONE’s hero? Straw argument? Delusional response? Can’t figure out where that came from.
Delusional or disingenuous? For this reason, I had to butt in as this speaks to the heart of credibility. Some present facts, hoping to advance a discussion, hoping that discussion will yield an interpolated “truth”.
Others argue on the basis of feeding an ego, facts and positions be damned as “winning” is the goal. If this is the case here, I can find nothing more onastic.
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Tim,
You should at least invest in a couple of 1 oz. Maple Leaves or Pandas and keep them handy. If you should need to “get out of Dodge” in a flash or emergency then they are money outside of the U.S.A. I can not think of any Bank in the World that would not be happy to exchange your gold coins for their currency at a small mark-down from the spot price to cover transaction fees.
Gold is universally recognized money or wealth and is respectively treated as such. They may put currency controls on the amount of Dollars you can exchange for their currency, but gold is always welcome. Even if it is not, there is ALWAYS a black market in precious metals and diamonds.
You can evade detection by the authorities if you are adroit (smart) enough. That may be what it takes to survive in the future, at home or abroad. In the end, you will have to depend on your own wits in an era of growing anxiety, financial instability, and declining Western Powers (Govt). They are increasingly getting desperate and repressive. So, We are all in transition, heading for a big global financial and monetary reset. Nobody knows what tomorrow will bring. So, take your chances.
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Thank you again, Craig.
First, I believe Americans are safest in the United States; and that this will be true for many years to come.
As you know, they are “targets” in other countries, inter alia, for injuries, death or kidnapping.
If one foresees increasing chaos globally, it may be best to enjoy our wonderful country and its vast beauty and diversity.
Second, the United States is the only Superpower in the world, militarily and economically. Russia is a pygmy state that is imploding under the murderous Putin; and China has serious problems of its own.
See, e.g., https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-7387 (“The Corruption And Criminality Of The Putin Regime”) and https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/#comment-7169 (“The Coming Chinese Crack-Up”)
The U.S. is much stronger than any of its rivals in the world, by far.
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Lastly, Craig, you got off into a discussion of the composition of our coinage; I did not.
Also, the United States is the only Superpower in the world, militarily and economically. This is a fact.
If the Middle East implodes—which is the direction that it is heading—China and other countries will seek our oil, gas and other energy products desperately.
And we will sell, sell, sell.
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ITS ALL A MATTER OF PERSPECTIVE
The Chinese will Buy, Buy, Buy our businesses and real estate as their wealth and Middle Class continues to grow. As a matter of FACT, it has been reported in the WSJ.com that the number of Chinese Middle Class has now exceeded the number of American Middle Class, relatively speaking of course. We are still number ONE for a while still. Keep in mind that America is a “Bean Sprout” compared to the 3,000 year old history of Chinese Dynasties ( Old Oak Tree by comparison).
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Defense Chiefs: Britain Feeble On World Stage
As the UK’s Telegraph has reported:
See http://www.telegraph.co.uk/news/uknews/defence/11673410/Defence-chiefs-UK-feeble-on-world-stage.html; see also https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-7387 (“The Corruption And Criminality Of The Putin Regime“)
Two questions must be asked and answered: (1) is the UK capable of contributing to NATO in a necessary and meaningful way, and (2) could it mount another offensive in the Falklands if it was required to do so, while still maintaining its NATO commitments?
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Once Greek Banks Fail, Grexit Will Become Irreversible [UPDATED]
Alex Pigman has written for AFP:
See http://news.yahoo.com/plan-b-looms-greece-europe-fall-223637633.html; see also http://www.wsj.com/articles/greece-suicide-watch-1435512143 (“Greek Suicide Watch“) and http://www.telegraph.co.uk/finance/economics/11714655/Greek-banks-down-to-500m-in-cash-reserves-as-economy-crashes.html (“Greek banks down to €500m in cash reserves as economy crashes“) and http://www.ft.com/intl/cms/s/0/9963b74c-219c-11e5-aa5a-398b2169cf79.html#axzz3esaK6MVO (“Greek banks prepare plan to raid deposits to avert collapse“) and http://www.telegraph.co.uk/finance/economics/11716318/Greeces-Yanis-Varoufakis-prepares-for-economic-siege-as-companies-issue-private-currencies.html (“Greece prepares for economic siege as firms issue private currencies“) and http://www.telegraph.co.uk/finance/economics/11718296/EU-warns-of-Armageddon-if-Greek-voters-reject-terms.html (“EU warns of Armageddon if Greek voters reject terms“)
In many counties, the military would intervene and seize control; and oust the so-called “leaders” and try them for crimes, before hanging them.
Also, Germany has attempted to achieve economically and governmentally what the Third Reich was unable to achieve militarily during World War II; namely, to become the “masters of Europe.”
Before I traveled to Greece for the first time, I met a German and his wife on the coast of the former Yugoslavia. He told me where to go in Greece, and added proudly that the Greeks were afraid of the Germans because of their occupation during World War II.
This feeling of German superiority carries over to today.
See https://en.wikipedia.org/wiki/Axis_occupation_of_Greece (“Axis occupation of Greece“); see also http://www.telegraph.co.uk/finance/economics/11736779/Greece-is-being-treated-like-a-hostile-occupied-state.html (“Greece is being treated like a hostile occupied state“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-1732 (“Will The Euro Crisis Will Give Germany The Empire It Has Always Dreamed Of?”)
Next, as I have written above:
Greece is merely one piece of the global puzzle, like the assassination of Archduke Franz Ferdinand of Austria was one link in the chain of events that led directly to World War I.
The global economy is precarious at best. Almost anything could trigger a crisis in today’s environment.
However, one of the greatest risks that has been perceived in Washington for many years is that a run would begin on the funds, which the central banks would be helpless to quell, leading to a liquidity crisis of unfathomable proportions, far worse than the banking crisis in Greece.
The Depression-era tools and “safety nets” would prove useless, and panics would ensue.
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-2177 (“The Risk Of Runs Is Real“); see also https://naegeleblog.wordpress.com/2015/07/01/global-chaos-and-helter-skelter/ (“Global Chaos And Helter Skelter“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7485 (“The World Is Defenseless Against The Next Financial Crisis“)
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Once this crisis hits, the world’s central bankers will not have the same options that were available to them during the 2008 crash. QE has failed miserably and has actually created an even bigger mess by massively increasing the world’s exposure to unfunded debt. Things are about to get very, very ugly … and there is virtually nothing that can be done to stop this coming economic train wreck.
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Thank you, Ray, for your comments.
Yes, I agree. As I wrote more than 6 years ago:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html (“Euphoria or the Obama Depression?”)
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Janet Yellen could start printing money again and help out the Greeks, or more importantly, the banks that are on the hook for all Greek Debt they bought. My understanding is the French are the ones who are most exposed to Greek debt. There is really no way to predict exactly what the full effects will be if Greece says no pay. Not much you can do to get “blood from a turnip”.
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There are many possible alternatives or outcomes.
See, e.g., http://www.telegraph.co.uk/news/worldnews/europe/greece/11703745/Theres-method-in-Greeces-madness-it-could-pay-off.html (“There’s method in Greece’s madness – it could pay off”)
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The World Is Defenseless Against The Next Financial Crisis [UPDATED]
These issues have been discussed already—in the article above, in other articles, and in various comments.
See, e.g., https://foreignpolicy.com/2015/07/08/the-fed-is-worried-about-greece-and-china-even-if-the-white-house-isnt/ (“The Fed Is Worried About Greece and China Even if the White House Isn’t“) and http://www.wsj.com/articles/chinas-stock-plunge-is-scarier-than-greecechinas-stock-plunge-is-scarier-than-greece-1436309780 (“China’s Stock Plunge Is Scarier Than Greece“) and http://www.telegraph.co.uk/finance/china-business/11725236/The-really-worrying-financial-crisis-is-happening-in-China-not-Greece.html (“The really worrying financial crisis is happening in China, not Greece“); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7520 (“Europe Is Blowing Itself Apart But Nobody Seems To Care“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7475 (“Once Greek Banks Fail, Grexit Will Become Irreversible“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7208 (“The World’s Next Credit Crunch Could Make 2008 Look Like A Hiccup“) and https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-7486 (“Putin Meets Economic Collapse With Purges, Broken Promises“) and https://naegeleblog.wordpress.com/2011/01/13/china-is-americas-enemy-make-no-mistake-about-that/#comment-7169 (“The Coming Chinese Crack-Up“)
Peter Spence has written in the UK’s Telegraph:
See http://www.telegraph.co.uk/finance/economics/11704051/The-world-is-defenseless-against-the-next-financial-crisis-warns-BIS.html (charts omitted; emphasis added); see also http://www.newsmax.com/Finance/StreetTalk/economy-crash-concern-poll/2015/06/27/id/652517/ (“Poll: 72 Percent Fear Economic Crash, Concern ‘Highest Ever'”—”‘The failure to recognize this moment as historic is largely because investors have been urged to believe things that aren’t true, have never been true, and can be demonstrated to be untrue across a century of history'”) and http://www.telegraph.co.uk/finance/newsbysector/industry/mining/11749706/Commodities-crash-could-turn-Australia-into-a-new-Greece.html (“Could Australia become the new Greece?“) and http://www.telegraph.co.uk/finance/economics/11762231/Emerging-market-currencies-crash-on-Fed-fears-and-China-slump.html (“Emerging market currencies crash on Fed fears and China slump”) and http://www.wsj.com/articles/the-only-six-stocks-that-matter-1437942926 (“Six firms—Amazon, Google, Apple, Facebook, Netflix and Gilead Sciences—account for more than half of the $664 billion in value added this year to the Nasdaq Composite. That is raising concerns about the health of the market”) and http://www.telegraph.co.uk/finance/china-business/11766449/China-losing-control-as-stocks-crash-despite-emergency-measures.html (“China losing control as stocks crash despite emergency measures”—”‘One by one the dominoes are starting to fall,’ said Societe Generale”) and http://www.telegraph.co.uk/finance/economics/11781249/Puerto-Rico-triggers-historic-default-as-austerity-spiral-deepens.html (“Puerto Rico triggers historic default as austerity spiral deepens”—”America’s home-grown ‘Greece’ is trapped in a vicious circle as a shrinking economy and an exodus of workers pushes the debt ratio through the roof”) and http://www.breitbart.com/big-government/2015/08/07/record-93770000-americans-not-in-labor-force/ (“RECORD 93,770,000 AMERICANS NOT IN LABOR FORCE“) and http://cnsnews.com/news/article/susan-jones/record-93770000-americans-not-labor-force-participation-rate-matches-38 (“Record 93,770,000 Americans Not in Labor Force; Participation Rate Matches 38-Year Low“) and http://www.breitbart.com/big-government/2015/08/07/record-56209000-women-not-in-labor-force/ (“RECORD 56,209,000 WOMEN NOT IN [AMERICAN] LABOR FORCE“) and http://www.washingtonexaminer.com/jobs-shock-100-of-female-employment-gains-taken-by-foreigners-since-2007/article/2569824 (“Jobs shock: 100% of [American] female employment gains taken by foreigners since 2007“) and http://www.bloomberg.com/news/articles/2015-08-11/death-cross-forms-in-dow-industrials-down-5-since-record-high (“The Death Cross Forms on the Dow Chart“) and http://www.cnbc.com/2015/08/11/presidential-candidate-trump-china-devaluation-will-devastate-us.html (“Presidential candidate Trump: China devaluation will devastate US“)
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Europe Is Blowing Itself Apart But Nobody Seems To Care [UPDATED]
The UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, has written:
See http://www.telegraph.co.uk/finance/economics/11724924/Europe-is-blowing-itself-apart-over-Greece-and-nobody-can-stop-it.html (emphasis added; charts omitted); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7485 (“The World Is Defenseless Against The Next Financial Crisis“) and http://www.telegraph.co.uk/finance/economics/11854259/Europe-faces-political-war-on-two-fronts-as-backlash-builds.html (“Europe faces political war on two fronts as backlash builds”—”The European Union is fracturing along multiple lines of cleavage, torn by an emerging Kulturkampf [or conflict between cultures or value systems] over migrant flows before it has overcome the bitter conflict at the heart of monetary union”—”The eurozone is still in a structural economic depression. Do not be fooled the short-term cyclical recovery under way”)
Nobody really cares whether the EU is blowing itself apart.
It was doomed from the start. And the more power that Germany and the EU’s bureaucrats accreted, the less that people cared.
Germany has attempted to achieve economically and governmentally through the EU what Hitler and the Third Reich were unable to achieve militarily during World War II.
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7475 (“Once Greek Banks Fail, Grexit Will Become Irreversible“)
The only reason to truly care is to hand the murderous Putin and Russia crushing defeats, from which they will never recover.
See https://naegeleblog.wordpress.com/2010/02/09/russias-putin-is-a-killer/#comment-7486 (“Putin Meets Economic Collapse With Purges, Broken Promises“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7283 (“US To Launch Blitz Of Gas Exports, Eyes Global Energy Dominance“)
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NONCHALANT AMERICA
You are right, nobody I know follows foreign developments, be it ISIS or Greece. Suburban Middle Class Americans are secure, comfortable ( by all indications), and apathetic to economics and politics. The U.S. Dollar is up a bit, most stocks have held their ground except foreign ADR’s like Alibaba ( BABA) due to China’s huge stock market blow-out. In fact, people are generally smug.
I have noticed some interesting market disconnects beginning last Sept. when the U.S. Dollar exchange rate rapidly appreciated. Precous metals took a steep dive, yet since Sept. it has been hard for individuals to buy silver coins ( “junk silver” or U.S. Mint Silver Eagle Coins ( 1 Oz.) The U.S. Mint ran out last Fall and have just ran out of Silver Eagles this week with a record amount of buying this July. None available ’till August. Premiums of 20% now apply to those who have any silver coins in stock.
The spot price of silver went down again today to $15.04/ounce.
The commodity futures and derivatives forward (long) contracts recently reported by the COMEX indicates JP Morgan Chase and Citibank have significantly increased their derivative exposure to silver and gold ( by a factor of 10X or $ 50 billion for Citibank alone). The regulators re-categorized silver contracts as “foreign currency” just recently to hide the numbers on their weekly reports. They are trying to keep a lid on silver prices.
There is a periodic shortage of silver coins from primary retail dealers whenever there is a financial blow-up somewhere. Its erratic but suggests markets are going haywire. I think the strategy is to contain the paper price of precious metals to keep other markets from panicking ( relative trade). They want to contain Greece and Puerto Rico ( Keep a Lid on It ). Its artificial, so let’s see how long the Central Bankers can keep up their facade of normalcy.
In the meantime, we should keep an eye on what really counts and not worry if nobody cares about Europe. Personally, I don’t care about the people who don’t care, whoever they are. Its all the more money for me if I beat them to the punch. That’s my game. What’s theirs?
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I think Sept. of 2015 will be quite “interesting” to say the least…
I began working from home, . . . and also began a small garden to grow potatoes and other veggies, to prepare for what is coming.
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Doomsday Clock For Global Market Crash Strikes One Minute To Midnight As Central Banks Lose Control [UPDATED]
The UK’s Telegraph has reported:
See http://www.telegraph.co.uk/finance/11805523/Doomsday-clock-for-global-market-crash-strikes-one-minute-to-midnight-as-central-banks-lose-control.html (charts and graphs omitted; emphasis added); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7485 (“The World Is Defenseless Against The Next Financial Crisis“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7283 (“US To Launch Blitz Of Gas Exports, Eyes Global Energy Dominance“) and http://www.telegraph.co.uk/finance/economics/11808488/World-shipping-slump-deepens-as-China-retreats.html (“World shipping slump deepens as China retreats”—”[T]he six-year economic expansion may be on its last legs”—”A closely-watched gauge of emerging market currencies has fallen for the eighth week – the longest run of unbroken declines since the beginning of the century – led by the Malaysian Ringgit, the Russian rouble and the Turkish lira”—”The port of Hamburg said trade with Russia collapsed by 36pc, the latest evidence that the rouble crash and deepening recession has forced Russian consumers to cut back drastically on purchases of imported cars and heavy goods”) and http://www.wsj.com/articles/u-s-lacks-ammo-for-next-economic-crisis-1439865442 (“U.S. Lacks Ammo for Next Economic Crisis”—”The world economy is like an ocean liner without lifeboats”) and http://www.marketwatch.com/story/dow-5000-yes-it-could-happen-2015-08-21 (“[S]omeone needs to tell the public that there is a plausible scenario in which the U.S. stock market now collapses by another 70% until the Dow Jones Industrial Average falls to about 5,000″—”[A] serious reading of history suggests this week’s sell-off might . . . be the beginning”—”There is a great deal of evidence suggesting that . . . the downward move that first began in 2000 has not ended”) and http://www.bloomberg.com/news/articles/2015-08-24/nyse-will-suspend-stock-trading-if-s-p-500-index-plunges-7- (“Stock Trading in U.S. Will Pause If S&P 500 Plunges 7%“) and https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/#comment-7646 (“The Surging Ranks Of America’s Ultrapoor“) and http://cnsnews.com/news/article/susan-jones/record-94031000-americans-not-labor-force-participation-rate-stuck-38-year (“Record 94,031,000 Americans Not in Labor Force; Participation Rate Stuck at 38-Year Low for 3rd Straight Month“) and http://www.telegraph.co.uk/finance/economics/11874484/Fed-is-riding-the-tail-of-a-dangerous-global-tiger.html (“Fed is riding the tail of a dangerous global tiger“) and http://www.wsj.com/articles/eurozone-nears-limits-of-what-monetary-policy-can-do-1442771605 (“Eurozone Nears Limits of What Monetary Policy Can Do“) and http://www.telegraph.co.uk/finance/economics/11898936/World-set-for-emerging-market-mass-default-warns-IMF.html (“World set for emerging market mass default, warns IMF”—”[P]anic in financial markets as liquidity evaporates”) and http://www.newsmax.com/Finance/StreetTalk/Carl-Icahn-fed-Minefield-economy/2015/11/04/id/700572/ (“[T]he Fed has inflated an economic bubble that is poised to burst”) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7812 (“Shipping Is Being Hit Hard By The Gathering Global Storm“) and http://www.wsj.com/articles/g-20-faces-dwindling-capacity-to-spur-souring-global-growth-1447617488 (“G-20 Faces Dwindling Capacity to Spur Souring Global Growth”—”World leaders are running out of options to revive a sickly global economy”) and http://www.telegraph.co.uk/finance/comment/12001710/Europe-is-sliding-towards-the-abyss-and-the-terrorists-know-it.html (“Europe is sliding towards the abyss, and the terrorists know it”—”The terrorists have struck just as Europe is at its most vulnerable – economically as well as politically”) and http://www.wsj.com/articles/u-s-housing-starts-fall-11-in-october-1447853742 (“U.S. Housing Starts Fall 11% in October“) and http://www.telegraph.co.uk/finance/12001895/Finlands-depression-is-the-final-indictment-of-Europes-monetary-union.html (“Finland’s depression is the final indictment of Europe’s monetary union”—”Finland is sliding deeper into economic depression . . . than the post-Soviet crash of the early 1990s, or the Great Depression of the 1930s”) and http://news.yahoo.com/brazils-middle-class-faces-plunge-back-poverty-065257556.html;_ylt=AwrXgiIMyFFWjEMAEbLQtDMD;_ylu=X3oDMTByYnR1Zmd1BGNvbG8DZ3ExBHBvcwMyBHZ0aWQDBHNlYwNzcg– (“Brazil’s new middle class faces plunge back to poverty“) and http://www.ft.com/intl/cms/s/0/40146b80-91bf-11e5-94e6-c5413829caa5.html (“Global debt defaults near milestone”) and http://www.wsj.com/articles/the-stock-market-is-missing-the-warning-from-junk-1449397806 (“The Stock Market Is Missing the Warning From Junk“) and http://www.telegraph.co.uk/finance/economics/12036942/Chinas-war-chest-of-forex-reserves-drops-to-lowest-since-2013.html (“China’s war chest of forex reserves drops to lowest since 2013“) and http://www.telegraph.co.uk/finance/economics/12040192/With-interest-rates-watch-out-for-the-unexpected.html (“With interest rates, watch out for the unexpected”—”Commodity prices and interest rates may turn much more violently than anticipated”—”[T]he oil price may have further to fall before it bottoms out”) and http://www.wsj.com/articles/the-fed-at-the-brink-1450139103 (“The Fed at the Brink”—”[I]t might be a bumpy ride”) and http://www.telegraph.co.uk/finance/economics/12052433/Third-Avenue-could-be-the-event-that-will-finally-explode-the-post-crisis-asset-bubble.html (“Is the next financial crisis nigh? Could closure of Third Avenue Fund finally explode the post-crisis asset bubble?”—”Investors demanded their money back, but managers were unable to liquidate their positions fast enough to deliver.
These early signs of panic were to snowball into an all-embracing run on the global banking system, forcing central banks to flood the market with cheap liquidity to prevent mass liquidation and economic collapse”—”Swamping the system with cheap money may have saved the world economy from a depression, but by pumping up asset prices anew to unsustainable levels, it has also made the system more vulnerable to a financial crisis, not less so. The world economy has never been more awash with debt. In this sense, the high yield squall may well be a harbinger of much worse to come”) and http://www.telegraph.co.uk/finance/oilprices/12081550/Saudi-showdown-with-Iran-nears-danger-point-for-world-oil-markets.html (“Saudi showdown with Iran nears danger point for world oil markets”—”The Persian Gulf has become a strategic tinderbox”—”The Iranians certainly have the technical means to inflict massive damage on Saudi infrastructure. James Woolsey, the former head of the US Central Intelligence Agency, said they have developed electromagnetic pulse (EMP) weaponry that can evade normal radar defences and destroy power systems.
They can launch orbiting satellites or low-tech variants floated on balloons launched from freighter vessels. “If they detonate one of these 30km in the atmosphere over a country, they can knock out the electricity grid,” he told The Telegraph”) and http://www.telegraph.co.uk/finance/financetopics/davos/12108569/World-faces-wave-of-epic-debt-defaults-fears-central-bank-veteran.html (“World faces wave of epic debt defaults”—”Situation worse than it was in 2007, says chairman of the OECD’s review committee”—”The global financial system has become dangerously unstable and faces an avalanche of bankruptcies that will test social and political stability”—”‘Our macroeconomic ammunition to fight downturns is essentially all used up'”—”Europe’s creditors are likely to face some of the biggest haircuts. European banks have already admitted to $1 trillion of non-performing loans: they are heavily exposed to emerging markets and are almost certainly rolling over further bad debts that have never been disclosed.
The European banking system may have to be recapitalized on a scale yet unimagined, and . . . any deposit holder above the guarantee of €100,000 will have to help pay for it”—”[I]t is impossible know what the trigger will be for the next crisis since the global system has lost its anchor and is inherently prone to breakdown”—”[T]he Fed is now in a horrible quandary as it tries to extract itself from QE and right the ship again. ‘It is a debt trap. Things are so bad that there is no right answer. If they raise rates it’ll be nasty. If they don’t raise rates, it just makes matters worse'”—”‘It was always dangerous to rely on central banks to sort out a solvency problem when all they can do is tackle liquidity problems. It is a recipe for disorder, and now we are hitting the limit'”)
As I have written:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html (“Euphoria or the Obama Depression?“)
One thing is certain: the worst is yet to come. The United States may fare better than other countries, but it will be affected too.
Hold on tight. Things will get very ugly!
See also https://naegeleblog.wordpress.com/2012/02/07/poverty-in-america/#comment-7646 (“The Surging Ranks Of America’s Ultrapoor“) and https://naegeleblog.wordpress.com/2015/07/01/global-chaos-and-helter-skelter/#comment-7653 (“Aylan And Galip Kurdi Will Be Remembered“)
. . .
Not factored into these comments are the effects of (1) the terrorist strikes on Paris and elsewhere; (2) the immigration issue that is tearing Europe apart; (3) the implosion that is taking place in the Middle East, with much worse yet to come; or (4) “runs” on the funds and other investments, as a result of panics that the Fed and other central banks cannot control.
See, e.g., http://www.telegraph.co.uk/news/worldnews/europe/france/11996678/Paris-terror-attacks-victims-isil-suspects-Syria-arrests-live.html (“Paris attacks: Chaos and fear grips capital after false reports of fresh gunfire send people ‘running for their lives’ – latest news“)
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EU Death March
The UK’s Telegraph has reported:
See http://www.telegraph.co.uk/news/worldnews/europe/11955742/We-are-seeing-the-last-dying-days-of-open-frontiers-in-Europe.html (emphasis added); see also https://naegeleblog.wordpress.com/2015/07/01/global-chaos-and-helter-skelter/#comment-7653 (“Aylan And Galip Kurdi Will Be Remembered“)
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As I was reading this article, I couldn’t help but think of parallels that can be drawn regarding the Roman Empire and the continuous migration of barbarian hordes into areas that were then being held by Rome. The barbarians, no doubt too, searched for a better life, often by simply squatting on Roman territory, which typically resulted in Roman military campaigns to forcefully regain Rome’s land. Although Rome was overwhelmingly successful in their wars against the barbarians both within and outside their borders, there were also, at various times, alarming military setbacks. After more than 600 years of virtually continuous wars and military campaigns, and, for a variety of other reasons, Rome eventually saw the benefit to ally themselves with various barbarian tribal leaders. Typically Rome would give land for barbarian military assistance. Eventually, Rome’s alliance with the barbarians backfired when, the Visigoths, living within the borders of Roman territory, rose up under the leadership of their King Alaric and sacked Rome in 410.
All over the western world, borders are being invaded with hordes of people that, in some cases, simply search for a better life. Others, perhaps, have other less benign intentions in mind.
In order to maintain peace and order within a nation, systematic immigration policies must be enforced for the benefit and protection of the nation. Otherwise, chaos will most likely be the future outcome. Will there be a cataclysmic repeat of the magnitude of the sacking of Rome in 410? Or, will it be a slow, grinding, never ending destruction of our long held way of life? I think the latter is far more likely, due primarily to the West’s seemingly death wish it has for itself. But of course, a dirty bomb set off in a major city of the West could have a similar effect of the Visigoths attack on Rome. The former case is already happening, the latter we have been warned about.
With all this, consider the artificial economies of the West (along with Asia), all built on a crumbling mountain of fiat currency and historic levels of debt, and the future is looking very bleak. As for wife and myself, we have One hope, and that rests upon the Rock that never changes … the Lord Jesus Christ. Seek God’s grace through Him while it still might be found.
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Thank you, Ray, for your astute comments as always.
My sense is that Europe is at risk, and the United States less so. We are the world’s only true “melting pot,” and a nation of immigrants.
See, e.g., https://naegeleblog.wordpress.com/2010/02/26/america-a-rich-tapestry-of-life/ (“America: A Rich Tapestry Of Life”); see also https://naegeleblog.wordpress.com/2010/07/30/illegal-immigration-the-solution-is-simple/ (“Illegal Immigration: The Solution Is Simple”)
The Middle East is imploding, and I believe the worst is yet to come. Indeed, Richard Nixon was very concerned about the “Clash of Civilizations,” and he was correct.
We may witness a day when the entire Middle East—including Israel—is overrun.
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American Strength
The UK’s Telegraph has reported in an article entitled, “What are the biggest defence budgets in the world?”—and subtitled, “The United States dominates the world when it comes to defence spending – but how do other countries compare?”:
See http://www.telegraph.co.uk/news/uknews/defence/11936179/What-are-the-biggest-defence-budgets-in-the-world.html (emphasis added; graphs omitted)
Also, it is useful to review the “List of countries by military expenditures,” which shows that the United States essentially spends as much as all of the other countries in the world combined.
See https://en.wikipedia.org/wiki/List_of_countries_by_military_expenditures
As I have written:
See http://www.realclearpolitics.com/news/tms/politics/2009/Apr/08/euphoria_or_the_obama_depression_.html
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The Flat Earth Society, Environmental Nazis Are At It Again, Bigtime [UPDATED]
During the Middle Ages, the myth and cosmological view of the flat Earth—instead of spherical—prevailed in Europe.
See, e.g., https://en.wikipedia.org/wiki/Myth_of_the_flat_Earth (“Myth of the flat Earth”)
Today, its intellectual equivalent, counterpart and alter ego is that man-made “global warming” or “climate change” exists, and that human beings can do something about it. Today’s “environmental Nazis” cite it as a fact, and try to silence those who believe otherwise. It is Hitler-esque and intolerable, yet it is happening.
Pollution of our oceans, sky and Earth is something that is man made; and steps have been taken for decades to deal with such issues as smog and litter. Great strides have been made.
However, our planet goes through natural cycles, of warming and cooling. It always has; and it will continue long after all of us—and our children, and their offspring—have left this earthly realm.
In another time, the proponents of “global warming” and the “green energy” fad would have been members of the “Flat Earth Society,” and claimed a “consensus” with respect to them too.
The latest and perhaps most important evolution of this bogus issue is discussed by the UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, in an article entitled “Fossil fuel companies risk plague of ‘asbestos’ lawsuits as tide turns on climate change”:
See http://www.telegraph.co.uk/finance/newsbysector/energy/11958713/Fossil-fuel-companies-risk-plague-of-asbestos-lawsuits-as-tide-turns-on-climate-change.html (emphasis added; charts omitted); see also http://www.telegraph.co.uk/news/earth/environment/globalwarming/11395516/The-fiddling-with-temperature-data-is-the-biggest-science-scandal-ever.html (“The fiddling with temperature data is the biggest science scandal ever”—”When future generations look back on the global-warming scare of the past 30 years, nothing will shock them more than the extent to which the official temperature records – on which the entire panic ultimately rested – were systematically “adjusted” to show the Earth as having warmed much more than the actual data justified”)
What is really frightening is the 2015 United Nations Climate Change Conference in Paris—which begins later this month—and its aftermath.
See, https://en.wikipedia.org/wiki/2015_United_Nations_Climate_Change_Conference and http://www.nytimes.com/2015/11/06/science/exxon-mobil-under-investigation-in-new-york-over-climate-statements.html (“Exxon Mobil Investigated for Possible Climate Change Lies by New York Attorney General“); see also http://www.telegraph.co.uk/finance/economics/11958916/Paris-climate-deal-to-ignite-a-90-trillion-energy-revolution.html (“Paris climate deal to ignite a $90 trillion energy revolution”—”[T]he energy industry is still banking on ever-rising demand for its products as if nothing has changed”—”[W]hile it might once have been possible for energy companies to dismiss these utterings as empty pieties, to persist now is to trifle with fate”—”A Carbon Tracker forum in the City this week was packed with bankers and fund managers itching to find a way into the biggest investment boom of all time, which is what the Paris accord promises to ignite”—”Technology takes no prisoners. Nor does politics. World leaders have repeatedly stated that they would defend the line of a ‘two degree planet’, and now they are taking the concrete steps to do so. Fossil investors have been warned”) and http://www.csmonitor.com/Science/2015/1101/Antarctica-is-actually-gaining-ice-says-NASA.-Is-global-warming-over (“Antarctica is actually gaining ice, says NASA“) and http://www.express.co.uk/news/science/616937/GLOBAL-COOLING-Decade-long-ice-age-predicted-as-sun-hibernates (“GLOBAL COOLING: Decade long ice age predicted as sun ‘hibernates'”) and http://www.express.co.uk/news/nature/617144/Antarctica-not-shrinking-growing-ice-caps-melting (“MELTDOWN MYTH: Antarctic ice growing is just the first EVIDENCE global warming is NOT REAL“) and https://naegeleblog.wordpress.com/2015/07/01/global-chaos-and-helter-skelter/#comment-7777 (“Pumpkins And The Flatulence Of Cows Cause Global Warming“) and http://thehill.com/policy/energy-environment/259395-union-obama-threw-workers-under-the-bus (“Union: Obama threw workers ‘under the bus’ in Keystone decision“) and http://www.telegraph.co.uk/news/earth/energy/11980548/The-obsession-with-global-warming-will-put-the-lights-out-all-over-Britain.html (“The obsession with global warming will put the lights out“) and http://www.telegraph.co.uk/news/worldnews/northamerica/usa/11980840/Fossil-crisis-deepens-as-Exxon-probed-on-climate-cover-up.html (“Fossil crisis deepens as Exxon probed on climate cover-up”) and http://www.wsj.com/articles/the-climate-agenda-behind-the-bacon-scare-1447115536?alg=y (“The Climate Agenda Behind the Bacon Scare“) and http://www.climatedepot.com/2015/11/19/scientists-declare-un-climate-summit-goals-irrational-based-on-nonsense-leading-us-down-a-false-path/ (“Prominent Scientists Declare Climate Claims Ahead of UN Summit ‘Irrational’—‘Based On Nonsense’—‘Leading us down a false path’”) and http://dailycaller.com/2015/11/25/the-new-consensus-97-of-americans-arent-worried-about-global-warming/ (“97 Percent Of Americans Aren’t Worried About Global Warming“) and http://www.wsj.com/articles/your-complete-guide-to-the-climate-debate-1448656890 (“[W]orld temperatures . . . have gone up only very slowly, less than half as fast as the scientific consensus predicted in 1990 when the global-warming scare began in earnest. Even with this year’s El Niño-boosted warmth threatening to break records, the world is barely half a degree Celsius (0.9 degrees Fahrenheit) warmer than it was about 35 years ago. Also, it is increasingly clear that the planet was significantly warmer than today several times during the past 10,000 years”—”On a global scale, as scientists keep confirming, there has been no increase in frequency or intensity of storms, floods or droughts, while deaths attributed to such natural disasters have never been fewer, thanks to modern technology and infrastructure. Arctic sea ice has recently melted more in summer than it used to in the 1980s, but Antarctic sea ice has increased, and Antarctica is gaining land-based ice, according to a new study by NASA scientists published in the Journal of Glaciology. Sea level continues its centuries-long slow rise—about a foot a century—with no sign of recent acceleration”—”[A] new study by a leading climate economist, Richard Tol of the University of Sussex, concludes that warming may well bring gains, because carbon dioxide causes crops and wild ecosystems to grow greener and more drought-resistant”—”The latest science on the “sensitivity” of the world’s temperature to a doubling of carbon-dioxide levels (from 0.03% of the air to 0.06%) is also reassuring. Several recent peer-reviewed studies of climate sensitivity based on actual observations, including one published in 2013 in Nature Geoscience with 14 mainstream IPCC authors, conclude that this key measure is much lower—about 30%-50% lower—than the climate models are generally assuming”—”Scientific skeptics are now routinely censored, or threatened with prosecution. One recent survey by Rasmussen Reports shows that 27% of Democrats in the U.S. are in favor of prosecuting climate skeptics. This is the mentality of religious fanaticism, not scientific debate”) and http://www.telegraph.co.uk/finance/economics/12021394/COP-21-climate-deal-in-Paris-spells-end-of-the-fossil-era.html (“COP-21 climate deal in Paris spells end of the fossil era”—”Much of the fossil industry will go into slow run-off while the new plutocrats will be masters of post-carbon technology”—”[T]he fossil fuel industry of coal, gas, and oil could forfeit $34 trillion in revenues over the next quarter century – a quarter of their income – if the Paris accord is followed by a series of tougher reviews every five years to force down the trajectory of CO2 emissions, as proposed by the United Nations and French officials hosting the talks”—”Most fossil companies would face run-off unless they could reinvent themselves as 21st Century post-carbon leaders, as Shell, Total, and Statoil are already doing”—”Such a scenario would imply the near extinction of the coal industry unless there is a big push for carbon capture and storage. It also implies a near total switch to electric cars, rendering the internal combustion engine obsolete”) and http://www.wsj.com/articles/scientists-dispute-2-degree-model-guiding-climate-talks-1448829047 (“Scientists Dispute 2-Degree Model Guiding Climate Talks”—”Many scientists say the benchmark underpinning talks in Paris on climate change is an arbitrary threshold based on tenuous research”—”It emerged from a political agenda, not a scientific analysis”—”Policy makers tend to assume the two-degree target expresses a solid scientific view, but it doesn’t”—”Hell is not going to break loose at two degrees—it will take hundreds of years to unfold”) and http://www.telegraph.co.uk/news/worldnews/asia/india/12022821/Paris-climate-talks-Through-the-smog-coal-hungry-India-sees-carbon-imperialism-in-the-West.html (“Paris climate talks: . . . coal-hungry India sees ‘carbon imperialism’ in the West”—”Faced with a rapidly growing population, a buoyant but fragile economy blighted by constant power shortages and millions still living in abject poverty, India argues that it cannot simply decide between renewable and non-renewable power – it needs both. So a breakneck dash for coal is taking place across the country, where on average one new mine is opening every month”—”Officials here are quick to point out that it still burns less coal than the US or China”—”This smacks of a ‘carbon imperialism.’ And such imperialism on the part of advanced nations could spell disaster for India and other developing countries”); but see https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7249 (“The Environmental Nazis Are At It Again“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-3036 (“The Global Warming Hoax, And The Great Green Con, Revisited“)
Even if all human beings were removed from the Earth, there would still be natural global warming and cooling as there have been for millions of years.
The Western policy elites’ obsession and fanaticism with global warming are threats to civilized life on this planet.
There are infinitesimally greater issues to think about today, such as growing terrorism and the collapse of the global economy, which will affect everyone in the world.
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7614 (“Doomsday Clock For Global Market Crash Strikes One Minute To Midnight As Central Banks Lose Control“)
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The key phrase in the second to last paragraph by Anthony Hobley speaks volumes; “… the new world order.” The entire Climate Change sham is nothing other than a means towards an end, and that is complete control over all our lives by power mad psychopaths.
It is entirely possible that much of what appears to be increasingly strange weather patterns, is actually the results of Geoengineering. When I first heard this, I thought this is real “tin hat” material. Now, I’m not so sure. Check this out for yourself and see what you think …
https://www.youtube.com/user/danewigington
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Thank you, Ray.
I agree with your first paragraph.
Regarding your second paragraph, and the link, the individual is the ultimate conspiratorialist. When I worked on the Hill, we used to receive lots of theories from similar people.
They are factual just enough not to come across as pure wackos.
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Shipping Is Being Hit Hard By The Gathering Global Storm
The “perfect storm” has been gathering and increasing in force for a long time now. When it strikes with all of its fury, hold on tight. Things will get very ugly!
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7614 (“Doomsday Clock For Global Market Crash Strikes One Minute To Midnight As Central Banks Lose Control“)
In an article entitled, “Quiet U.S. Ports Spark Slowdown Fears,” the Wall Street Journal has reported:
See http://www.wsj.com/articles/quiet-u-s-ports-spark-slowdown-fears-1447583406 (emphasis added; charts omitted)
Echoing similar fears in an article entitled, “Shipping industry braced for storm to blow long and hard,” the UK’s Telegraph has reported:
see also http://www.telegraph.co.uk/finance/newsbysector/industry/11996019/Shipping-industry-braced-for-storm-to-blow-long-and-hard.html (emphasis added; charts omitted)
Not factored into any of the three comments are the terrorist strikes on Paris or the immigration issue that is tearing Europe apart.
See, e.g., http://www.telegraph.co.uk/news/worldnews/europe/france/11996678/Paris-terror-attacks-victims-isil-suspects-Syria-arrests-live.html (“Paris attacks: Chaos and fear grips capital after false reports of fresh gunfire send people ‘running for their lives’ – latest news“)
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SUCH IS LIFE
The French Government ( President Hollande) did nothing significant to tighten-up THEIR security after the Charlie Hebdo massacre this past January. About all he did was admit more Muslim immigrants into existing “No Go Zones”. So, the latest terrorist incident is to be expected. Now they closed the French border and imposed a curfew on all French citizens. Too late now. Probably the same cell responsible for both atrocities.
The French have a saying which is apropo: C’est la vie . I suggest they find a new president with a different view towards security, immigration, and Muslim (“Syrian”) immigrants. American political leadership is not much different, no smarter today, and so we are getting to be more like the French every year. Unless we change course, there will be no surprises for me here. We all make choices. We all live or suffer with the consequences of them. Such is Life.
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Obama will be swept out of office? Uh… he is in his second term.. he retires when that finishes…. there is not third term
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I never suggested that he was in his third term.
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Fed Will Have To Reverse Gears Fast If Anything Goes Wrong
This is the title of an article by the UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard:
See http://www.telegraph.co.uk/finance/economics/12056991/Fed-will-have-to-reverse-gears-fast-if-anything-goes-wrong.html (emphasis added; charts omitted)
For those who have never worked in Washington, much less with the Fed on banking and related matters, there is one very important lesson that must be kept in mind: it is a government agency, run by government bureaucrats.
If you or anyone else would trust your life and economic future, and that of your family, to such people then so be it. At best, those who make decisions at the Fed are “well-intentioned” economists, who are no better than weathermen (and women) at predicting the future.
Look out the window on any given day, and see how accurate they are with their predictions, must less at predicting the future. In a word, they are not.
There is a global economic storm that has been gathering for some time now, which—when it hits with its full force and fury—may equal or exceed what happened during the Great Depression of the last century.
And the government economists, bureaucrats and other functionaries at the Fed and the other central banks of the world will be baffled and helpless.
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7614 (“Doomsday Clock For Global Market Crash Strikes One Minute To Midnight As Central Banks Lose Control“)
One thing is certain: the worst is yet to come. The United States may fare better than other countries, but it will be affected too.
Hold on tight. It will not be pretty or nice. Indeed, things will get very ugly!
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The EU’s Collapse In 2016? [UPDATED]
It is clear to growing numbers of Europeans that the EU is a bureaucratic nightmare, which has outlived its usefulness. Indeed, a reinvigorated NATO may take its place, not as an ill-conceived economic alliance but as the “glue” that holds the countries together.
A fine year-end article by Leo McKinstry in the UK’s Telegraph is worth reading and reflecting on:
See http://www.telegraph.co.uk/news/newstopics/eureferendum/12071434/How-the-EU-could-collapse-in-2016.html (“Rather than protect Europeans, the EU itself has become the greatest threat to our continent“) (emphasis added); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7520 (“Europe Is Blowing Itself Apart But Nobody Seems To Care“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7614 (“Doomsday Clock For Global Market Crash Strikes One Minute To Midnight As Central Banks Lose Control“) and https://naegeleblog.wordpress.com/2016/01/16/the-obama-great-depression/#comment-8068 (“The World’s Central Banks Can’t Save Us Anymore“) and http://www.telegraph.co.uk/news/newstopics/eureferendum/12115072/European-civilisation-is-in-danger-of-succumbing-to-the-EU-empire.html (“European civilisation is in danger of succumbing to the EU empire”—”[T]he EU’s claims about what it has done need closer inspection. It is not true, for example, that it assured post-war peace. The main peacemaker was the Nato alliance, especially the determination of the United States to rebuild Germany and hold back Soviet communism. It was Nato, operating through leaders like Ronald Reagan, Margaret Thatcher and Helmut Kohl, which later created the conditions in which the Berlin Wall could come down without the world falling apart. By contrast, the EU’s price for the reunification of Germany – the creation of the single currency – has been the most destabilising act in the history of Europe this century. Germans nowadays tell Greece (and Spain and Portugal and Italy) what to do – not because they have the evil intent of old, but because the euro puts them in charge of the zone’s money”—”It is not a dictatorship, but an empire, in a world where other empires have disappeared”—”When a real crisis arises, the EU cannot act. It failed in the former Yugoslavia in the 1990s and finally had to let the Americans come to the rescue”—”[T]he dreamers wanted to become the United States of Europe. As we are now seeing, this cannot survive the arrival of hundreds of thousands of mainly Muslims refugees from the Middle East”) and http://www.telegraph.co.uk/finance/economics/12127776/Brexit-would-trigger-disintegration-of-the-EU-not-the-UK-say-Barclays.html (“Brexit would trigger disintegration of the EU not the UK, say Barclays”—”Europe, rather than the UK, would suffer the worst consequences of a “Brexit”—”Should Brexit occur, this would embolden other member states who are struggling to control immigration and unleash a fresh wave of turmoil in the crisis-hit continent”—”[I]f Britain voted for and exit and ‘politics in the EU turned for the worse, the UK may be seen as a safe haven from those risks, reversing the euro’s appreciation and putting significant downward pressure’ on the single cur[r]ency”—”‘In that environment, Scottish voters could be even less inclined to leave the relative safety of the UK for an increasingly uncertain EU, further reversing sterling’s appreciation'”)
Clearly, Americans, Europeans, Chinese, Russians and others around the world have lost faith in their governments, and in the ability of any government to solve problems—and rightly so.
For example, while Paris was still grieving about the senseless deaths and violence that took place there recently, Barack Obama and other “warmers” were convening in the same city to feast on caviar and other delicacies, after wasting jet fuel to attend a conference about so-called man-made “global warming.”
Such lunacy reminds one of Marie Antoinette and class conflict and western decadence, and of George Orwell and his Animal Farm where the “Pigs” reigned supreme.
See https://en.wikipedia.org/wiki/Animal_Farm (“Animal Farm“) and https://naegeleblog.wordpress.com/2015/11/30/a-34-trillion-swindle-the-shame-of-global-warming/ (“A $34 Trillion Swindle: The Shame Of Global Warming“) and https://naegeleblog.wordpress.com/2015/11/30/a-34-trillion-swindle-the-shame-of-global-warming/#comment-7850 (“Marie Antoinette’s Merry Band Of Elitist Warmers“)
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Helter Skelter Is Arriving With A Thud, Sell Everything [UPDATED]
In an article entitled “RBS cries ‘sell everything’ as deflationary crisis nears,” the UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, has reported:
See http://www.telegraph.co.uk/finance/economics/12093807/RBS-cries-sell-everything-as-deflationary-crisis-nears.html (charts omitted: emphasis added); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7614 (“Doomsday Clock For Global Market Crash Strikes One Minute To Midnight As Central Banks Lose Control“) and http://www.telegraph.co.uk/finance/oilprices/12094394/Oil-price-could-fall-to-10-a-barrel-warn-investment-bank-bears.html (“Oil could crash to $10 a barrel, warn investment bank bears”—”[M]ajor banks say there is no bottom in sight for the world’s lopsided market”) and http://www.telegraph.co.uk/finance/economics/12097262/Notorious-uber-bear-Albert-Edwards-warns-world-is-headed-for-another-2008-crash.html (“Notorious ‘uber bear’ Albert Edwards warns world is headed for another 2008 crash”—”US stocks could lose almost three-quarters of their value”—”[T]his coming collapse would result in a ‘trade war not unlike that in the 1930s’, mirroring the deflationary bust and trade war of the Great Depression era”—”[C]onditions appear ‘very dangerous for every investor in the world'”)
This is not 2008 all over again. It may be much much worse, even eclipsing the Great Depression of the last century.
The “perfect storm” has been gathering for a long time now; and when it hits with its full force and fury, 2008 may seem like a “blip” by comparison.
America’s Fed and the other central banks of the world will be overwhelmed; depression-era “safety nets” will not make any difference; and panics may ensue.
The biggest worry in Washington for many years now has been that there would be runs on the big funds, which are uninsured, and that a “liquidity crisis” of unfathomable proportions would occur—which would be unstoppable.
Americans and people of other countries have lost trust in their governments, which will only compound the problems.
Hold on tight. Things will get very scary between now and the end of this decade.
. . .
The good news is that the murderous Putin and Russia are in a death spiral from which they will not recover. The fall of oil prices and our economic sanctions will insure this. The sooner that Putin shares the fate of Mussolini, the better.
See https://naegeleblog.wordpress.com/2015/11/29/the-death-of-putin-and-russia-the-final-chapter-of-the-cold-war/ (“The Death Of Putin And Russia: The Final Chapter Of The Cold War“)
The totally-bureaucratic EU’s collapse will be offset by renewed vigor at NATO. The EU is a grand experiment that has failed and outlived its usefulness.
It is a bureaucratic monstrosity of epic proportions. George Orwell anticipated it when he wrote Animal Farm, in which the “Pigs” reigned supreme.
Germany’s attempt to accomplish economically what it failed to achieve militarily during World War II is at an end, and rightly so.
See https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-8006 (“The EU’s Collapse In 2016?“); see also https://en.wikipedia.org/wiki/Animal_Farm (“Animal Farm”)
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The EU And Brexit [UPDATED]
In an article about Brexit—a British exit from the European Union, which would give the U.K. self-determination and free it from the dysfunctional European project—Tom Montgomerie has written in the Wall Street Journal:
See http://www.wsj.com/articles/a-better-britain-outside-the-eu-1455917425 (“A Better Britain Outside the EU“) (emphasis added); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-8006 (“The EU’s Collapse In 2016?“) and http://www.nysun.com/foreign/brexit-of-champions-how-britain-may-trigger/89468/ (“[S]taying in the European Union would eventually doom British sovereignty. No wonder six members of Cameron’s own Cabinet have now come out for quitting Europe”—”[A] British exit from Europe would be a geopolitical earthquake. It would be a rebuke not only to European socialism but also to the idea of Europe as an anti-American bloc”—”Imagine . . . if an independent Britain could lead to a new and wide alignment with America, whose own revolution was inspired by ideas of liberty often hatched in England and Scotland. It would be terrific all around. . . . Our greatest international triumphs . . . were under the partnerships of Churchill and FDR and Thatcher and Reagan”) and http://www.nysun.com/editorials/breakfast-and-the-brexit/89473/ (“[I]f Britain stays within the European Union there’s not a chance that it will leave Britain . . . alone. This is what Brussels does. It looks for opportunities to control people’s lives”) and http://www.telegraph.co.uk/business/2016/02/28/mervyn-king-the-eurozone-is-doomed/ (“[Former governor of the Bank of England] Mervyn King: the eurozone is doomed”—”The eurozone is doomed to fail and will lurch from crisis to crisis unless it is broken up”—”‘Monetary union has created a conflict between a centralised elite on the one hand, and the forces of democracy at the national level on the other. This is extraordinarily dangerous'”—”[T]he euro area today is a drag on world growth”—”The ‘only way’ to stop countries staring into the abyss of ‘crushing austerity, continuing mass unemployment’ with ‘no end in sight to the burden of debt’ faced by debtor nations is for them to abandon the euro”—”[L]eaving the euro area may be the only way to plot a route back to economic growth and full employment. ‘The long-term benefits outweigh the short-term costs'”) and http://www.telegraph.co.uk/comment/12177006/Dont-be-taken-in-by-Project-Fear-staying-in-the-EU-is-the-risky-choice.html (Boris Johnson: “Don’t be taken in by Project Fear – staying in the EU is the risky choice”—”[T]he Remain campaign is intended to provoke only one emotion in the breast of the British public and that is fear”—”[T]he real risk is to sit back and do nothing, to remain inertly and complacently in an unreformed EU that is hell-bent on a federal project over which we have no control”—”[T]he euro . . . proved to be a nightmare, an economic doomsday machine that is still causing low growth, high unemployment and real misery in some European countries”—”It is Nato and the Atlantic alliance that underpins our security”)
The EU is a bureaucratic nightmare come true. It is everything that George Orwell predicted in his “Animal Farm,” where the “Pigs” would reign supreme over the other animals.
Germany’s attempt to accomplish economically what it failed to achieve militarily during World War II may be at an end, and rightly so.
Do the Brits have the guts to pull out of the EU? David Cameron has cut a “paltry” deal that is probably not worth the paper it is written on. It is the Brits’ equivalent of the Obama-Kerry deal with Iran.
Will Brexit trigger an unraveling of the EU that might never stop? Only time will tell. However, NATO may serve as the “glue” that holds Europe together, not the nation- and freedom-strangling EU.
Lastly, a “perfect storm” has been gathering globally for a long time now, which may affect all of these calculations. When it hits with its full force and fury, 2008 may seem like a “blip” by comparison.
Indeed, millions of young Europeans and others globally may never recover fully from the joblessness that it will produce.
See https://naegeleblog.wordpress.com/2016/01/16/the-obama-great-depression/ (“The Obama Great Depression“); see also https://en.wikipedia.org/wiki/Animal_Farm (“Animal Farm“)
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Opec Has Failed To Stop US Shale Revolution
The UK Telegraph‘s International Business Editor in London, Ambrose Evans-Pritchard, has reported:
See http://www.telegraph.co.uk/finance/economics/12169239/Opec-has-failed-to-stop-US-shale-revolution-admits-energy-watchdog.html (“Opec has failed to stop US shale revolution admits energy watchdog“) (emphasis added; charts omitted); see also https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7283 (“US To Launch Blitz Of Gas Exports, Eyes Global Energy Dominance“)
The biggest losers will be the murderer Putin and Russia.
Aside from the catastrophe of Russia’s foreign currency reserves running out, perhaps the key sentence of a recent New York Times’ article is the following:
Putin and Russia are in a death spiral from which they will not recover. Putin’s fantasies about Russia becoming a superpower are delusional.
See https://naegeleblog.wordpress.com/2015/11/29/the-death-of-putin-and-russia-the-final-chapter-of-the-cold-war/ (“The Death Of Putin And Russia: The Final Chapter Of The Cold War“)
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US Oil Exports Mark Game-Changing Shift in Global Power [UPDATED]
Newsmax has reported:
See http://www.newsmax.com/Finance/StreetTalk/oil-export-US-power/2016/02/23/id/715649/; see also https://naegeleblog.wordpress.com/2015/11/30/a-34-trillion-swindle-the-shame-of-global-warming/ (“A $34 Trillion Swindle: The Shame Of Global Warming“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-8287 (“Opec Has Failed To Stop US Shale Revolution“) and https://naegeleblog.wordpress.com/2010/09/27/the-economic-tsunami-continues-its-relentless-and-unforgiving-advance-globally/#comment-7283 (“US To Launch Blitz Of Gas Exports, Eyes Global Energy Dominance“) and http://www.wsj.com/articles/the-new-oil-storage-space-railcars-1456655405 (“The New Oil-Storage Space: Railcars”—”The U.S. market is so oversupplied with oil that traders are experimenting with a new place for storing excess crude: empty railcars”—”[T]raditional storage tanks are filling up as U.S. oil inventories swell to their highest level since the 1930s”—”Some industry participants are calling the new practice ‘rolling storage’—a landlocked spin on the ‘floating storage’ producers use to hold crude on giant oil tankers when inventories run high”—”[Trading companies] profit by putting the oil aside while locking in a higher price to deliver it in a later month”—”U.S. crude inventories rose above 500 million barrels in late January for the first time since 1930”) and http://www.telegraph.co.uk/business/2016/02/28/us-shale-frackers-eye-world-conquest-despite-bloodbath/ (“US shale frackers eye world conquest despite bloodbath”—”OPEC’s price war against shale will not stop the US juggernaut. Oil giants with deep pockets are waiting in the wings to ‘gobble up’ distressed assets, and America’s nimble mid-cost frackers will have an edge when the cycle turns”—”US shale [may be] the biggest supplier of oil in the world by 2020″—”This would amount to 16m b/d if all liquids are included, more than the combined crude exports of Saudi Arabia and Russia. The International Energy Agency forecast this week that the US would account for much of the growth in world output by 2020 – after dropping 600,000 b/d this year, and 200,000 next year”—”[I]t will not be long before engineers work out how to double the efficiency of shale extraction to the 50pc levels seen in conventional oil wells”—”[F]rackers have been remarkably resilient, raising productivity by 20pc and cutting well costs by 40pc. ‘Restarting production may be easier than people think. Everything is ready to go. There are plenty of rigs. All the ingredients are there. There is a lot of money looking for the bottom of the cycle, waiting to get back in'”—”[T]he lucrative Permian Basin of West Texas, the ‘crown jewel’ holding steady at 2m b/d even at current prices[,] . . . is as big as the giant Ghawar field in Saudi Arabia, and could eventually produce 6m b/d”)
Bravo to American drive, creativity and ingenuity!
Despite the efforts of our failed president and the “environmental Nazis” to kill this vital sector of our economy, America’s oil industry continues to grow.
Once again, the United States is the largest energy producer in the world, and essentially energy independent. We do not need the Middle East anymore, for anything; and this fact is shaping our foreign policy approach to that region—which is in the process of imploding, with much worse yet to come.
Also, the sooner that we crush the murderous Putin and Russia, the better.
See https://naegeleblog.wordpress.com/2015/11/29/the-death-of-putin-and-russia-the-final-chapter-of-the-cold-war/ (“The Death Of Putin And Russia: The Final Chapter Of The Cold War“)
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The Crash Of 1929: Can It Happen Again? [UPDATED]
This is the title of an article in ZeroHedge, which states:
See https://www.zerohedge.com/news/2018-04-27/crash-1929-can-it-happen-again (emphasis added; charts omitted); see also https://www.wsj.com/articles/growing-concern-foreign-investors-lose-some-hunger-for-u-s-debt-1525080601 (“Growing Concern: Foreign Investors Lose Some Hunger for U.S. Debt“)
If Hillary Clinton had been elected, the collapse might have been inevitable. Having lost, she and her Despicables on America’s Left have sown the seeds of treason and tried to destroy the duly-elected presidency of Donald Trump.
The stock market has always been a “fool’s paradise,” and housing prices are inflated beyond reason in places like Los Angeles and Northern California’s Bay Area.
This is what the Democrats, and eight years of the failed, racist president Barack Obama have given us. And yes, many of us began as Democrats.
See, e.g., https://naegeleblog.wordpress.com/2017/05/16/americas-newest-civil-war-2017-and-beyond/ (“America’s Newest Civil War: 2017 And Beyond“) and http://marketshadows.com/2012/05/21/greenspans-legacy-more-suffering-to-come/ (“Greenspan’s legacy: more suffering to come“) and https://naegeleblog.wordpress.com/2009/12/05/is-barack-obama-a-racist/ (“Is Barack Obama A Racist?“)
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You are an extremely powerful writer. I can easily see this in your article. You have a way of writing compelling information that sparks much interest.
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Thank you, Rodolfo, for your kind words.
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