Disaster Plan

Does your family have an economic disaster plan?  If not, why not?  By now, most people know that very hard economic times are coming.  No, America is not going to turn into a post-apocalyptic war zone where motorcycle gangs ravage the populace next week, but the truth is that it doesn’t take a genius to understand that the U.S. economic system (and indeed the entire world economic system) is in the process of dying.  For decades we have lived far beyond our means by borrowing insane amounts of money, but the party is ending and now many of us are going to get to experience what it means to live below our means.  The golden days of the U.S. economic machine are gone, and now we are moving into a time when we are going to reap the fruit of the incredibly foolish economic policies of the past hundred years.  Meanwhile, the two major political parties will continue to play the American people against each other.  The Democrats will insist that everything will be great if we just give them control.  The Republicans will insist that everything will be great if we just give them control.  But the truth is that both political parties have had numerous chances over the past 50 years, and each of them have blown them badly.  Both parties have had a hand in piling up the biggest mountain of debt in the history of the world, both parties have been complicit in shipping our jobs and our factories off to China and to dozens of third world nations, both parties have dramatically expanded the size of government and the welfare state when they were in control, and both parties have continually handed more power to the big banks and to the Federal Reserve.  We built an entire economy based on paper money and a gigantic spiral of debt and now the wheels are starting to come off and people are starting to panic.  We are truly going to pay the price for decades of foolish decisions.

Not that an economic collapse is the only reason to have a family disaster plan.  We live at a time when it seems like the whole world is going crazy.  You never know when or where the next oil spill, hurricane, earthquake, volcano, pandemic or terror event is going to strike.

So the reality is that it is imperative that we all have a disaster plan that sets out exactly how we are going to provide food, water, shelter and security for our families in the event of a major disaster or emergency.

So exactly what should such a disaster plan entail?

If you have not done so already, please read the following two articles that we previously published on this theme….

1) 20 Things You Will Need To Survive When The Economy Collapses And The Next Great Depression Begins

2) What To Do

Both of those articles lay out some of the basic principles of emergency preparedness.

But there is so much to know about emergency preparation beyond just the basics.

Over the last couple of months, the readers of this column have shared some amazing information on this topic, and we have compiled some of the very best of those tips below….

Smuggler:

As a long time hiker and back country lover I have had a bit of experience in rustic living. From Tents in the Rockies and Sierras to the bottom of the Grand Canyon and an old trapper’s cabin in Alaska I have pretty much lived in that way most of my life.

Survival depends on a lot of things, not just how much grub you got or how many bottles of water are stashed away. If all roads are blocked your stocked RV is suddenly going to be a liability not an asset.With roads blocked by earthquake or check points the ability to travel cross country will be reduced to foot transportation, unless you plan to tote your pick-up over the mountains think lighter….

If it all goes up the first thing you must do is realize that this is not a camping trip, you come home from a camping trip, you won’t have a home to come to if it all goes up. You are going to have to find food and water as you go and in the case of food you will most likely have to kill it and clean it. Man bites dog will have a whole new meaning.

That is where the best survival tool will be most welcome. The nice thing about this tool is it takes up no room and it doesn’t weigh an oz. Become knowledgeable.learn about water and how to test it, find it and save it. learn how to preserve foods by drying or smoking. learn what plants in your area can be eaten or used for medicine.

You get the idea here, the more ya know the longer you will live. One of the places I have spent some time hiking is the Idaho and Utah boarder area and parts of the old Boozeman Trail. one of the remarkable things you see on the Trail is tons of cast Iron cook stoves, nickel trimmed Parlor stoves, furniture, house hold goods, sinks etc. that litter the ground. All tossed off overloaded wagons, from about the middle part of the Trail tapering off to just a few items the farther west they got. Take to much you have to throw it away.

A good make pro back pack, a good sleeping bag/ground pad, light tent, fire making items, [ I recommend a mag and steel striker. ]a good hand axe, a good hunting knife, a pro grade compass, [Learn how to use it.} Food, freeze dried is best very lite and can carry many days of food. Limit clothes as appropriate for the weather and how much you can carry. Water, what you can carry and treatment tablets for new sources if in doubt. Other wise boil it for ten mins.

Things like sewing kits are nice but won’t kill ya if you don’t have one. Judge your wants balanced against your needs, in the case of candles and radios and such, they are heavy hard to secure and take up lots of room. In the case of candles I’ve had them melt all over the inside of my back pack not a fun thing.

Keep it light and essential,you may have to relocate in a big hurry. Now, do you see why community is a good idea? You can survive one man alone, but in a group is easier, safer and more productive and more fun. Here’s hoping all your trips are camping trips and may you always come home.

RLTW:

Food: If you are about to go on a long “hike” like for a couple of weeks… seriously fatten up. Talk to anyone who has done ranger school. They lose 20-45lbs in only 63 days. Most fatten up just before going. If you only have one meal/ day, then eat in the morning and eat small amounts throughout the day (like a candy or cracker) and keep drinking water. Surprise salt is important, dont go low sodium in food especially if you are consuming a lot of water. On the move, Eat the most perishable first, eat based solely off the energy you are expending. If you open it consume it, or you will have unwanted pests/animals. In bear country, hang it from a high limb away from where you sleep. If you cant brush your teeth, chew gum, or chew soft twigs.

Gerber or Leatherman is better than a Swiss knife, and BTW Butch I pack heat, so good luck and don’t let the laser sight on your forehead deter you.

Gasoline doesnt store for very long, and know the difference between diesel and gas (I know this is basic, but some people cant tell except for what it says at the pump). And also know that Syphoning gas from new autos is impossible, so don’t try, remove it from the fuel line/filter under the car.

Have a small tool kit/box, with basic tools.

If you are on the move, the right Clothing is extremely important…. Get loose fitting clothing that you can easily layer, have about 3 layers or more (depending on your local climate). One layered set should be enough, but you NEED extra socks, 2-3 pair (or more) of heavy cushioned socks are ESSENTIAL if you are on the move. Change your socks every day, even if you cannot wash them. A week could turn into a month. Dont pack underwear, b/c after a week it will be gone anyway (Most infantry soldiers go without in the field) and is just extra weight. Think of going for a long hunting trip when packing this up, and remember its always colder than you think even in the summer especially when you cannot go indoors anywhere. Pack gloves and ski type hats. At a minimum, keep your feet and shoes dry. If they get wet, walk it out, & change socks more frequently. In the cold, Keep your shoes/boots next to you when you sleep to keep them warm and be ready if you need to move out quickly. Dont be unpacked, take out what you need and leave the rest packed. You may have to take off quickly. (Pack everything you want to keep dry in gallon-sized ziplocks)

Don’t rely on a store first aid kits, buy a medium sized tool bag and get a good first aid “trauma” list(most stuff you can get at walmart). But also consider learning how to start an IV and get a few. Also, address all knicks and cuts, even the small ones. Infections can put you under, ESPECIALLY ON YOUR FEET/LEGS.

Water: If you have bleach, you can use that to purify water. One drop per Quart. Be careful, if you use too much then you will have a bad case of buttmud.

Fire: can be started with 2 D-cell batteries and steel wool, but invest in a magnesium stick that you can use with a knife.

If Money is worthless, have things to bargin with & you will be better off. Consider gold coins, you can always cut off chucks to use as payment. CAUTION: To much of something valuable will make you a target, so consider things that are valuable other than Gold.

A NON-digital watch is helpful, and can be used for navigation… plz dont ask, google it or get a survival book (which is also good) – I use the SAS survival book

MAPS!!!!! Hello, a good map of your area where you intend on going is very helpful, especially of your immediate area (topographic) and will help you locate water. It is impossible to hand carry your water needs, know your sources along your route. Keep a good small atlas with your kit, may have to leave a contaminated area and may have to travel on the roads or beside the roads. You can easily use a good atlas to terrain navigate in lieu of a good topo map. Know the state evacuation routes, then plan an alternative b/c they will be packed.

Set up “rally” points that everyone knows and will link up or leave messages if safe and no communications exist.

Flashlight: invest in an efficient LED headlamp, that way you have both hands free.

The AXE is not required: You need only a good Knife, like a K-bar…dont buy a cheap hollow survival knife (they will break), buy a regular good 5-8in blade that is heavy and durable. You can use the knife with a piece of wood or log to hammer the knife like an axe for firewood….but your call. Remember, you may have to carry it.

If you have a friend in Spec ops or is a Ranger, Seal, etc… ask them for tips or advice… we train in this type of thing.

Elocutionist:

There are other things people can do; must do: Build up a network of support. Get to know your neighbors and be certain all of you support one another. I live in a small development of about 90 homes. We are closed off from the main highway and, even in these relatively ‘good’ times, we always rely on one another for various things (i.e. snow ploughing, lawn mowing, etc.). Make a plan with your family, if they’re not nearby, so that in tough times you’re not alone. Develop a skill. Learn how to make bread, for instance, from flour on a wood stove. Become an expert ‘handyman,’ the ability to repair things will be an important skill. Plan for the worst, hope for the best. In either case, you’ll be prepared.

Jim:

You’d be surprised at how little work it takes to have a seed turn into dinner. It’s almost as if that was what the seed was designed to do. Even people in apartments can cut their food down quite a bit with herbs, tomatoes, and the like in the windows. 1/4 acre can feed a family of more than four, and that’s worth spending a few minutes a day if you ask me.

Paul:

A couple of useful items: Clorox. Very cheap. Can purify water and also handy for sterilizing anything. Saving a pile of old newspapers is another good cheap item — useful for starting a fire and, hey— better than nothing, using as toilet paper. More expensive — a couple of handfuls of silver coins in case no one wants US paper dollars.

John:

Also, look at yard sales and thrift shops. If you really need a couple of cheap shirts, instead of buying cheap ones made in India, recycle what is already in your community, putting some money into your neighbors’ pockets.

Try to buy food locally. It’s more expensive, but if you are careful, you can find a few affordable items. If you live in the city, talk to your local council and try to get projects going that allow community vegetable patches on vacant land. In some areas this is already happening. Grow herbs in your kitchen. When you are down to beans and rice, it is amazing how a little bit of fresh herbs can spice up your life. YOu have a sunny window in your house? Start growing something easy like zucchini.

Learn how to repair – anything. You won’t get rich, but you might eventually make a decent living. Most of us are getting poorer and are going to want what we have to last longer. I remember as a kid in a small town there was a shoe repair shop, an electrical repair shop, a furniture repair shop, etc. Now they have all disappeared because most of us have gotten use to throwing things out and buying new. My guess is that the market for repairs is only going to grow.

Have you got a sewing machine? Buy up cheap clothing/fabrics from a thrift shop and turn them into quilts, stuffed animals, bags, interesting clothes for kids. This Xmas lots of people are going to be looking for cheap gifts for their children. You won’t be making much per hour, but at least you might be making something

Go dumpster diving. Especially if you live in a private college town, you will be amazed at how much perfectly good clothing and furniture gets dumped every year. In a small town that I visit every summer, one thrift shop fills a complete dumpster with clothes every week – almost all of it in near perfect condition. The dumpsters near dorms are overflowing at the end of terms.

Boycott. Don’t buy from/do business with companies that send all their jobs overseas.

If you live in a place with a community college and if you have a bit of money, learn a trade. Community colleges tend to be relatively cheap and they give you good skills. And if you have a kid of college age, ask them if they really want that degree in 18th century literature badly enough to starve.

Finally – get involved and become political. A lot of people know that they are not happy, but they are not sure what to do and are waiting around for other people to come up with the solutions. Start thinking about something that is important to you locally, regionally or nationally and figure out a way to be part of the solution. One reason we are in such a mess is because we all tuned out a bit and let the bigshots call all the shots – and they created a world that works great for them, but at our expense.

Michael:

Every once in a while, I see these “survivalist” cans of Costa Rican canned green coffee beans. Ok, so I pay about $80 bucks (not to mention some paying for some hefty shipping charges). I thought to myself-why can’t I do it (in the spirit of DIY). Ok, it can be easily done. First, purchase GREEN coffee beans. Second, seal them in a good container. I use a half gallon Ball canning jar WITH an oxygen absorber. A half gallon jar will hold about 2.5 pounds of beans and I use one or two 500CC oxygen absorbers-just to make sure no oxygen exists afterwards. Thrid, Seal the jar with a new canning jar lid. Keep out of light. No moisture (dry beans and glass sealed jar), no oxygen (absorber does that), no light, and keep in cool storage (room temp or cooler); and the coffee is good to go for years!

J.E. Chapman:

I will tell you that a swiss army knife wont cut it, you need a good beefy knife like a K-Bar fighting knife something you can use to pound, dig, chop, and even kill with if nessesary, a SOG is another good choice, remember you get what you pay for.  Also read and study up time I believe is short a good manual is Emergency Preparedness and Survival Guide from Backwoods Home magazine is a very good book to have along with all the military survival manuals you can get your hands on, arm up with a Good rifle a good sidearm and plenty of ammo, enough food for a year and good luck. Praying Helps moreso than most would believe, God Bless.

Uncle Sam:

Knowledge is the store of value that “neither moth nor flame can corrupt or destoy” They can’t take that from you.

Store enough food to make it through a year from ANY point in the agricultural cycle. Start growing food now, so you can learn how it works. A farmer doesn’t become a farmer after one or two seasons, you must get everything wrong before you know how to do it right, and that takes time and experience. Start now, its July…plant greens in August and have salads through November just to get some experience.

Basically, you will find that it breaks down like this…If you can’t grow it, mine it, trade for it, or kill for it; you are not going to have it, and if you are not prepared to do all four of those, you are in danger.

There exists a critical tipping point, a point of mass despair and anger that will capitulate our way of life. This is NOT like the 30’s. In that era, we were set up to live autonomously, so long as we could keep the mortgator at bay (with a shotgun) we are not like that anymore. Americans especially are not prepared for what is coming. We are too integrated. Most have neither the means or opportunity to live autonomously, they only have fear as the motive when they run out of food or are kicked out of their homes. Very dangerous, they are forced to crime. In the 30’s, people were bummed that they had to return to the agrarian lifestyle of their ancestors on the family farm instead of “making it” in the city, we don’t have that option today. People will riot hard and more and more police are laid off every day.

One day, the power will go out and not return. The day that happens, the poles will be felled for the wood, and the copper stripped for trade. Then, the infrastructure is gone. Remember that sight, as the defining momonet of the descent.

Francis:

The two of us have a tiller, a grubbing hoe and some smaller hoes. Each spring we hire a tractor to prepare the garden. Get soil tested through gov’t. or ag school for knowledge of correct soil amendments (lime, fertilizer etc.) Bugs will take care of themselves for the most part, though some hand work may be necessary. Diseases will need to be worked around (different varieties of plants) We don’t use poisons.

We work about an hour a day in the spring, 4-5 days a week on about 1/2 acre, less as the year goes along. We grow two crops, the fall garden is usually small. Our biggest chore is weeds. The two of us could live off of this if we had to. We have about 20 fig trees and lots of other fruit trees. Yes, we are blessed. But there is something we can all do to supplement the bounty nature gives.

City folk, think small. You will be amazed at what some diligence and patience will do when joined to a willing hand and some knowledge. By the way, the sweetest meal you will ever eat is the one you grow yourself.

Lots of you talk about slavery. The best way out is to get rich. The best way to get rich is slowly. If you are profligate forget it. But if you save some of everything you get and through nothing away that has any possible worth, you will start finding ways to save a penny here and there.

And community is the long term key to subsistence. Even the hard-headedest persons I know take notice when the fruits of frugality are exposed. I can’t fix a motor and my mechanic neighbor can’t grow corn. I have gone out of my way to make him a friend.

We Americans are resourceful when not anesthetized by superfluity. Despise nothing. Make every object the subject of evaluation. A lot of something adds up to a little of anything.

Wake up.

Bearmaster:

Those of us who are preparing for what now seems to be at our door will be ready. Not only preparing with water, food, fuel, matches, seasonal clothing and whatever else is needed, we will be the few who do survive and will remember the rest of you who did not ‘believe’.

There is no shame in getting ready for any event, especially when it comes on suddenly. Those caught by surprise are the ones who will suffer the most. If you think because you have guns and ammo that you will come and take away what you feel you need and deserve, how?

Without water after two days you will be delirious to the point you can’t think straight. After five days of beans and bacon bits you’ll wish you had stocked up on toilet paper. When you come staggering up with gun in hand, do you really think you’ll be able to pull off this ‘robbery’ and take what you can, how?

Will you have a shopping cart or a little red wagon? Maybe the back of your pickup would work but where will you get the gas? How can you carry anything with guns in hand, don’t you think there will be others waiting who will then take advantage of you?

Those who think the ‘community’ idea won’t work are those who can’t get along with or won’t trust other people. How can you stay awake and alert for 24/7, you, the wife and kids against what odds? Think about it, trusting family, neighbors and friends in a small group will be the only way to get through this unless they bomb us into eternity.

A small group can provide many things, sharing in the expense of preparing and putting things away in the best, safest location you can find. Those living in a city, large town or even in a development, you need to have a plan of escape to quickly get to a safer location.

*****

Will Thousands Of Police Layoffs Unleash Chaos And Anarchy Across America?

Thousands of police officers have been laid off all across America since the current economic crisis began.  Thousands more are getting ready to be laid off.  So could we be on the verge of a new era of chaos and anarchy in America as crime runs wild and there are just far too few police to respond to it all?  That is the message that one blood-smeared billboard in Stockton, California is trying to get across.  Paid for by theStockton, California police union, the message of the billboard is chillingly clear: "Welcome to the 2nd most dangerous city in California. Stop laying off cops."  As state, city and local governments across the United Statescontinue to be devastated by the ongoing economic crisis, budget cuts are becoming much deeper and police forces have suddenly become a very popular target.

Officer Steve Leonesio, the president of the Stockton Police Officers Association, has announced that the police union plans to spend approximately $20,000 on at least 20 more billboards.

Why is the union putting up all of these billboards?

Well, it turns out that Stockton has been considering a plan to lay off 53 police officers in an effort to eliminate a $23 million budget deficit.

But law enforcement in Stockton has already been cut to the bone.  Recently, the Stockton Police Department dropped this bombshell….

"We absolutely do not have any narcotics officers, narcotics sergeants working any kind of investigative narcotics type cases at this point in time."

Do you think drug dealers will be flocking to Stockton after they hear that?

But the truth is that so many of these local governments around the nation are just flat broke at this point.

Even major cities are having to admit that they have accumulated such large debts that they cannot even afford to provide the most basic services any longer.

In Oakland, California the battle over police layoffs has made national headlines over the past couple of weeks.  Oakland has laid off 80 police officers, and now the police chief says that there are some crimes that his department simply will not be able to respond to.

In fact, Chief Anthony Batts has compiled a list of exactly 44 situations, including grand theft, burglary, car wrecks, identity theft and vandalism, that his officers will not be available to handle any longer.

What in the world?

Once upon a time in America you could get a police officer to come out for just about anything – including for getting a cat down out of a tree.

But those days are long gone.

Today it is very hard to get a police officer to come out for anything short of murder.

The following is a partial list of crimes that police officers in Oakland will no longer be responding to….

  • burglary
  • theft
  • embezzlement
  • grand theft
  • grand theft: dog
  • identity theft
  • false information to peace officer
  • required to register as sex or arson offender
  • dump waste or offensive matter
  • discard appliance with lock
  • loud music
  • possess forged notes
  • pass fictitious check
  • obtain money by false voucher
  • fraudulent use of access cards
  • stolen license plate
  • embezzlement by an employee (over $ 400)
  • extortion
  • attempted extortion
  • false personification of other
  • injure telephone/power line
  • interfere with power line
  • unauthorized cable tv connection
  • vandalism

Not that Oakland wasn’t already a mess, but now how long do you think it will be before total chaos and anarchy reigns on the streets of Oakland?

But Oakland is far from alone.

The sheriff’s department in Ashtabula County, Ohio has been slashed from 112 to 49 deputies, and there is now just one vehicle remaining to patrol all 720 square miles of the county.

So what are the citizens of that county supposed to do to protect themselves?

Well, when asked about what they should do, Judge Alfred Mackey gave this stunning piece of advice….

"Arm themselves."

So is that what we are left with?

Is American society degenerating into a "Road Warrior-style" wasteland where we are all left to fend for ourselves?

It gets really frightening when you start considering just how many police are actually being laid off across the United States….

*Acting State Police director Jonathon Monken has announced that the Illinois State Police will lay off more than 460 troopers and close five regional headquarters by this fall.

*Atlantic City Mayor Lorenzo Langford has proposed a plan to lay off 40 police officers.

*The police department in Vallejo, California will temporarily suspend its K-9 and SWAT programs at the end of the month in a move to delay officer layoffs.

*Last year, 18 special police units in Toledo, Ohio – including the gang task force and the mounted patrol – were eliminated or downsized in an effort to replace the 130 patrol officers who were laid off because of a $20.7 million budget deficit.

*Of 315 municipalities the New Jersey State Policemen’s union canvassed,more than half indicated that they were planning to lay off police officers.

*Four police officers in one town in New Jersey were greeted at work this past Monday morning with notices informing them that they will be laid off on August 31st.

*Police in Phoenix, Arizona have been told that more than 400 officerscould be impacted by layoffs if "the worst case scenario" plays out.

*Police and firefighters in Flint, Michigan decided that layoffs were preferable to taking a 15 percent pay and benefits cut.

*The city of Maywood, California laid off all 68 of its employees July 1st and is now "contracting out" police services.

*In Colorado Springs, dozens of police positions are going unfilled and the police helicopters were put up for sale on the Internet.

The sad thing is that as local police forces across America are being stripped down or dismantled, many communities are opening their arms wide to increased federal law enforcement "assistance".

In recent years, we have seen a large number of examples where the U.S. military is being used for domestic law enforcement, which is supposed to be against the law.  In addition, federal government agencies are increasingly taking over the financing, training and even command of local police.

But is this "federalization" of local law enforcement a good thing?

Of course not.

Unfortunately we live at a time when almost everything is being centralized under federal government control.  Of course this is completely contrary to everything that our founders intended, but most of our "officials" don’t seem too concerned about actually following the Constitution these days.

The U.S. Economy Is A Dead Horse And The American People Are Starting To Get Really Pissed Off And Frustrated

The economic frustration of the American people is reaching a fever pitch.  Millions of Americans can’t seem to get a good job no matter what they do.  Millions of others are working as hard as they can but find that they keep coming up short at the end of the month.  Record numbers of Americans are still going bankrupt.  Record numbers of Americans are still losing their homes.  Meanwhile, the U.S. economy is a dead horse at this point.  It just doesn’t have any more to give.  At this point the U.S. economy is like an aging rock star that requires larger and larger doses of drugs each night just to be able to perform.  The U.S. economy is addicted to "drugs" such as debt and government stimulus, and years ago those things really supercharged the U.S. economic system, but at this point they aren’t provoking much of a response at all.  In fact, the things that once "stimulated" the economy are now slowly killing it.  But the vast majority of the American people do not understand this.  All they know is that the economy is broken and they want someone to "fix" it.

For most Americans, all we have ever known is tremendous prosperity.  All our lives we have been taught that America is the richest and most prosperous nation on the planet, and that while there will always be times of "recession", things will always bounce back and be better than ever before.

But this time things aren’t bouncing back.

And Americans are starting to become extremely frustrated.  

A couple of quotes that appeared in a recent article in The New York Daily News really embodied the growing frustration that so many are feeling at this point….

"My husband and I are fortunate to be able to move in with my 81-year-old mother-in-law. But how sad is that? I apply for jobs and nothing happens," writes Gayle Hanson. "Who wants to hire a 59-year-old woman? My answer is nobody. [I] have years of experience, excellent references. And nothing to show for it."

"I am soon to be 57 and considered too old, too expensive, etc. I can’t get an employer to hire me at any salary," writes Mike Stiller. "I am BOILING MAD."

But Gayle Hanson and Mike Stiller are far from alone.

Millions upon millions of Americans are "boiling mad" about the economy at this point.

The truth is that the United States has lost 10.5 million jobs since 2007.  Many of those jobs have been shipped off to countries like China and India where labor is much cheaper and they are never coming back.

There just are not enough jobs for everyone in America at this point.  The number of "chronically unemployed" has been rising at a frightening pace.  In fact, the average duration of unemployment in the United States has risen to an all-time high.

If you have never been unemployed and unable to find a job, then you just don’t know how soul crushing it can be.  This is especially true when you have a family to support.

Right now, there are 9.2 million Americans that are unemployed but are not even receiving an unemployment insurance check.  It is easy to tell those unemployed workers that they should "get a job", but as the chart below shows, the gap between the number of unemployed workers and the number of job openings has increased dramatically over the last couple of years….

But in this economy, even many of those who do have jobs are still struggling mightily.  According to a poll taken in 2009, 61 percent of Americans "always or usually" live paycheck to paycheck.  That was up significantly from 49 percent in 2008 and 43 percent in 2007.

And Americans are still losing their homes in record numbers.  Banks repossessed an average of 4,000 south Florida properties a month in the first half of 2010, which was up 83 percent from the first half of 2009.

Meanwhile, demand for homes is dropping through the floor.  The Mortgage Bankers Association announced on Wednesday that demand for loans to purchase U.S. homes sunk to a 13 year low last week, and refinancing demand also plummeted despite near record-low mortgage rates.

So considering all of these statistics, is it any wonder why so many Americans are so pessimistic?

According to a recent poll conducted by Bloomberg, 71% of Americans say that it still feels like the economy is in a recession.

But the truth is that we haven’t seen anything yet.

Things are going to get much worse.

Already, Federal Reserve policymakers are discussing what steps they might take to stimulate economic activity "if the outlook were to worsen appreciably".

So can more economic stimulus help?

To a limited extent.

The Federal Reserve and the U.S. government will likely try to inject more debt and more "economic stimulus" into the system to try to shock the economy back to life.

But the more debt the U.S. government takes on the worse our long-term problems are going to get.

The reality is that the U.S. economic system is broken, and there is simply not any "quick fix" that is available that is going to get things back to normal.

So on an individual level, what should we all do?

Well, we all need to start becoming a lot less dependent on the system.

We should all consider how we can start our own businesses, grow our own food and trade within our own communities.

If the entire system is starting to break down, it is those who are the least dependent on the system that will have the best chance to prosper during the times ahead.

What Does The Financial Reform Bill Do Other Than Being Completely And Utterly Worthless?

Is it possible to write a 2,300 page piece of legislation that accomplishes next to nothing and is pretty much completely and utterly worthless?  The answer is yes.  Barack Obama has been trumpeting the Dodd-Frank financial reform bill as the "biggest rewrite of Wall Street rules since the Great Depression", but the truth is that after the Wall Street lobbyists got done carving it up, the bill that was left was so watered down and so toothless that it essentially accomplishes nothing except creating even more government bureaucracy and even more mind-numbing paperwork.  The bill is so riddled with loopholes for the big banks that it is basically the legislative equivalent of Swiss cheese.  The Democrats in the Senate were ecstatic when they announced that they had secured the 60 votes needed to pass this legislation, but when they are asked about what the financial reform bill will do, most of them are left stammering for some kind of cohesive response.  The sad truth is that most of them probably don’t understand the bill and none of them will probably ever read the entire thing.

So will the financial reform bill do any good at all?

Well, yes.

A very, very small amount.

Essentially, it is kind of like going over to the Pacific Ocean and scooping out a couple of cups of water.

That is about how much good this bill is going to do.

But U.S. Senate Majority Leader Harry Reid is making this sound like this is some kind of history-changing legislation….

"We’re cleaning up Wall Street."

Oh really?

Charles Geisst, professor of finance at Manhattan College recently had the following to say about this absolutely toothless bill….

Like health-care reform, this bill is being drawn up to grab headlines but its details betray it as nothing more than a slap on the wrist for Wall Street. It is true that Wall Street can commit grand theft and apparently get off with nothing more than community service.

The truth is that most of us never expected the U.S. government to truly take on Wall Street.  The relationship between the two is just way too cozy for that to happen.

So does the financial reform bill actually accomplish anything?

Yes.

Let’s take a look at the "sweeping changes" contained in the bill….

*Federal regulators will receive more authority to monitor everything from mortgages to complex derivatives.  (Oh goody!  Just what we needed – more federal regulation!  As if federal agencies have ever been very good at regulating the financial industry…)

*Financial firms will be required to reduce the debt they take on and to hold more capital in reserve.  (This will make financial firms marginally more stable, but the truth is that the big banks are so good at accounting tricks that this will not really make much of a difference.  When a big firm is going to fail a few extra bucks in reserve is NOT going to make a difference.)

*The U.S. government will be given extensive power to seize collapsing financial firms.  Federal regulators would keep collapsing firms operating long enough to prevent a massive panic and would slowly sell off its pieces.  (This does not eliminate "too big to fail" – instead it enshrines "too big to fail" into law permanently.  The bill institutes "orderly procedures" for exactly how to proceed when the U.S. government steps in and takes over failing financial firms.  Just what we need – more socialism!)

*The financial reform bill creates a new Bureau of Consumer Financial Protection at the Federal Reserve that is supposed to help prevent abusive lending by mortgage and credit card companies.  (Wait a second – this bill gives the Federal Reserve more power?  Who came up with that grand idea?  Yeah, let’s give the fox more power to guard the hen house.  The truth is that the Federal Reserve is one of the core problems with our economic system as we have written about previously.)

*Some rather toothless regulations will be placed on the derivatives markets, hedge funds and credit rating agencies.  (A big emphasis on "toothless".)

So what does this legislation not do?

-It does not eliminate "too big to fail".  The truth is that the biggest banks and financial institutions have been systematically gobbling up a bigger and bigger share of the market and this legislation does nothing to change that.  Anthony Sanders, a professor of finance in the School of Management at George Mason University, says that this bill essentially does nothing about the "too big to fail" problem….

"As far as I can see the ‘too big to fail’ problem is still in place."

In fact, this legislation may cause even more consolidation in the financial industry, because small firms are going to have an especially difficult time complying with all of the new rules, regulations and paperwork created by this bill.

-The financial reform bill does nothing about the horrific bubble in the derivatives market.  Originally it was believed that some tough regulations were going to be imposed on derivatives trading, but the Wall Street lobbyists were all over those provisions like rabid dogs.

So now there is loophole after loophole in the bill and the "derivatives problem" still ominously hangs over Wall Street.  Not that there is any way to fix it.

Nobody actually knows the true total value of all the derivatives in the world, but estimates place it at somewhere between 600 trillion dollars and 1.5quadrillion dollars.

When the derivatives bubble pops, and it will, there won’t be enough money in the entire world to fix it.

-The financial reform bill does nothing about mortgage giants Fannie Mae and Freddie Mac.  They remain financial black holes that the U.S. government will be forced to pour hundreds of billions (if not trillions) of dollars into.

-A proposal to conduct yearly comprehensive audits of the Federal Reserve was left out of the financial reform bill.  Instead, a very, very, very limited one-time audit of a few of the transactions that the Federal Reserve conducted during the height of the financial crisis was included.

What we really need is a true audit of the Fed.  The Federal Reserve has never been the subject of a true, comprehensive audit since it was created in 1913.  Considering the fact that the Federal Reserve issues our currency, controls our banking system, sets our interest rates and is basically the core of the U.S. economy, you would think that the American people should have the right to see what is going on over there.

But Ben Bernanke and the rest of the folks over at the Fed fought against the comprehensive audit proposal with everything that they had.  They seemed extremely alarmed that the American people might actually get to take a look inside their books.

The truth is that unless something is done about the Federal Reserve, no true "financial reform" is really going to take place.

But the U.S. Congress could have done at least some good with this bill.

Instead, they have given us a 2,300 page mess that is pretty much completely and utterly worthless.

Economic Problems?

With each passing news cycle, it seems like the economic headlines just keep getting worse.  And unfortunately, the highly integrated global economy that we have constructed means that what happens on one side of the world is going to very likely have a big impact on the other side of the world.  A meltdown in New York or Los Angeles is going to affect London, Paris, Rome, Berlin, Moscow, Beijing and Tokyo.  That is just the way the world works now.  Back in 2007 and 2008, the financial crisis that began in the United States devastated economies across the globe.  So are there any economic problems brewing out there right now that could send another wave of panic across the globe?

Well, yes, actually there are a whole bunch of them.  In fact, if certain things break the wrong way it could create a gigantic mess in the financial world.  Let’s take a few moments to examine a few of the questions that economists are asking right now….

Will The Eurozone Break Up And Devastate The Global Economy?

One of the most respected financial journalists in the world, Ambrose Evans-Pritchard, is warning that cases currently making their way through the German court system could actually result in the breakup of Europe’s monetary union.  The cases involve the massive EU bailouts that have been agreed to recently.  It is being argued that these bailouts actually violate EU treaty law, and therefore they also violate Germany’s supreme and sovereign Basic Law.

So what would happen if the German courts rule against these bailouts?

Well, it could be catastrophic.  Ambrose Evans-Pritchard put it this way in his recent column….

"Should they succeed, of course, the eurozone risks disintegration within days, and perhaps hours."

And he is not the only one sounding the alarm.  In fact, one major Dutch bank is warning that a full-fledged disintegration of the eurozone would trigger the worst economic crisis in modern history and would unleash a deflationary shockwave that would envelop the entire globe including the United States.

That doesn’t sound promising, does it?

So is it going to happen?

No, probably not.

It would be a great, great victory for national sovereignty if it did happen, but there are just way too many powerful interests that are way too invested in seeing the eurozone succeed.  In addition, the legal, economic and political obstacles that would have to be overcome to fully break apart the eurozone are absolutely mind-numbing when you start thinking about them all.

Instead, what we are likely to see are calls for even more European integration.  Already, many politicians are claiming that the current crisis has been caused because Europe is simply not integrated enough.

So, no, the eurozone is not likely to break up, but that doesn’t mean that we are not going to see massive economic problems in Europe over the coming years.

Will The U.S. Congress Extend Long-Term Unemployment Benefits?

The U.S. Congress continues to debate whether or not they are going to extend long-term unemployment benefits for an estimated 2.1 million unemployed Americans that have stopped getting unemployment checks.

So will they end up getting it done?

Probably.

But there are a growing number of lawmakers that are extremely alarmed about how incredibly fast the U.S. debt is growing.

It is a shame that many of them were not concerned about it 12 or 13 trillion dollars ago.

Not that we shouldn’t help the millions of American workers that have been out of work for a long time and can’t get jobs.

A lot of people are really, really suffering out there right now.

So where did all the jobs go?

Well, as we detailed in a previous article, our politicians and our big American corporations have been busy shipping them off to China and to a whole host of third world nations over the past couple of decades.

The millions upon millions of jobs that have been lost are gone permanently and are not coming back.

So we are likely to continue to have a growing underclass of chronically unemployed blue collar workers that don’t have jobs and can’t get jobs because there are not nearly enough of them for everyone.

So, yes, Congress is likely to extend the unemployment benefits soon, but what those millions of Americans really need are good jobs.

Will The World Trade Imbalance Continue To Get Worse?

It was recently announced that China’s trade surplus climbed 140 percent in June compared to a year earlier.

At least globalism is working well for somebody.

The truth is that someday people will look back and think that U.S. leadership must have been insane when they allowed the greatest economic machine to ever be assembled to systematically be dismantled and shipped off to China, India and dozens of other third world countries around the globe.

The other side of this tragedy is the tremendous exploitation of third world populations which we are allowing big global corporations to get away with.

In one of his recent articles, Stephen Lendman told the tragic story of sweatshop worker Naran Dhula Bhil….

In February 2009, he was hospitalized at Dharmaj, in Gujarat state, coughing, very weak, struggling to walk, and unable to lift anything heavier than five pounds. Since mid-2008, he lost almost half his body weight, dropping from 132 to 70 pounds of skin and bones. On April 14, he died of silicosis, the result of greed, indifference, and consumer ignorance about buying "gemstones of death."

Bhil was 11 when he began working as a grinder, shaper, and polisher, making gemstones into hearts, pendants, rings, beads, and various type ornaments.

For a day’s work, he produced 100 – 150 for 15.5 cents an hour, $1.08 daily, or less than a penny for each stone produced, each giving off silica dust that killed him. By age 20, he knew it, stayed on the job, borrowed money to buy gemstones, and became "bonded," meaning he couldn’t quit until out of debt, what few grinders ever do.

Bihl said his shop employed 35. Only four or five are left, the others sick or dead. "So many have died," he said, and when he expired "he did not have a single penny to his name," as true for most others.

Could you imagine if that was your life story?

What big global corporations are getting away with is absolutely mind blowing.

The global economic system is broken and the only ones who seem to really be benefiting from it are the giant corporations and the ultra-rich.

Is this going to change any time soon?

No, unfortunately, it will not.

Will Americans Continue to Be Obsessed With Money?

According to a new poll of Americans between the ages of 44 and 75, 61% said that running out money was their biggest fear. The remaining 39% thought death was scarier.

Running out of money scarier than death?

Yes, it is very important to provide for ourselves and for our families,especially as we head towards economic collapse, but the obsession that the American people have with money and wealth is completely and totally out of control.

At the end of your life, do you want your life to be defined by the pile of stuff that you have accumulated or by what you were able to do with your life?

The truth is that we don’t even actually "own" most of what we think that we own.

There is so much more to life than getting stuff and having stuff, but the mainstream media will continue to push Americans to love the "consumer culture" which has come to dominate our way of life.

So, yes, Americans will continue to be obsessed with wealth, money and with who LeBron James is playing basketball for.

But you can make a different choice.  You can choose to live your life for what really matters.

Is The U.S. Economy Going To Turn Around As We Approach The Christmas Season And The End Of The Year?

Many analysts are hoping that as the holidays approach the American people will get back to their old ways of spending massive amounts of money and that this will help jumpstart the U.S. economy.

So is there reason for optimism?

Well, no.

Vacancies and lease rates at U.S. shopping centers continued to get even worse during the second quarter of 2010.  In fact, in some of the most depressed areas of the United States, many malls and shopping centers could end up looking like ghost towns by the time Christmas rolls around.

So what are some of the areas in the U.S. that are the worst economic disaster zones?

Well, everyone knows about Detroit.  Once regarded as one of the crown jewels of American industry, Detroit is now a rusted-out war zone that is a shell of its former self.

South of there, the state of Illinois has now become a complete and total disaster zone.  The government of Illinois has stopped paying even its most essential bills and it now ranks eighth in the world in possible bond-holder default.  Universities and government agencies are experiencing absolute chaos as they try to figure out how they are going to continue to function without any money.

Of course then there is California, where the Schwarzenegger administration has won an appellate court ruling saying it has the authority to impose the federal minimum wage of $7.25 an hour on more than 200,000 state workers as California wrestles with its latest budget crisis.  Things are now so bad in California that in the region around the state capital, Sacramento, there is now one closed business for every six that are still open.

Next door to California, in Nevada, things may be even worse.  Official unemployment in Nevada is hovering around 14 percent (unofficially it is much higher of course) and it is estimated that a whopping 65 percent of all homes in the state of Nevada are underwater.  There is perhaps no state in the U.S. that has been hurt more seriously by the housing crash than Nevada.

Unfortunately, things look like they are going to get even tighter for state and local governments in the year ahead.  Economist Mark Zandi is warning that up to 400,000 state and local government workers could lose their jobs in the next year as states, counties and cities grapple with lower revenue and less federal funding.

On top of all this, there is the threat that the Gulf of Mexico oil spill could push the teetering U.S. economy completely over the edge.

Many cities along the Gulf of Mexico coast were already economic disaster zones even before this oil spill.  

But now we are talking about an economic nightmare of unprecedented proportions.

The seafood, tourism and real estate industries along the Gulf coast have been decimated and people are leaving in droves.  It could be years, or even decades, before things get back to some kind of "normal" in the area.

Some are even warning that this oil spill could cause the collapse of BP, and if that happens it could bring about absolute chaos on world financial markets.

Why?

Well, it turns out that BP is a major source of global liquidity and is a major player in the worldwide derivatives market.

If someday the worldwide derivatives market crashes, there won’t be enough money in the entire world to fix that problem.

But that is a topic for another day….

What To Do

Today, more Americans than ever are absolutely convinced that we are headed for an economic collapse.  After all, it doesn’t take an advanced degree in economics to understand that American consumers, American businesses, local governments, state governments and the U.S. federal government are all drowning in debt.  It would be hard enough to deal with all of this debt during good economic times, but these are not good economic times.  In fact, right now the U.S. economy is being pounded by an unprecedented number of economic problems.  Tens of millions of Americans are unemployed or underemployed, 40 million Americans are on food stamps, the U.S. real estate crash continues to get worse, and the ongoing oil spill in the Gulf of Mexico threatens to drag that entire region, and perhaps all of the United States, into a devastating economic depression.  So these days it is fairly easy to convince Americans that really hard economic times are coming.  But now an increasingly large number of people have a new question.  They want to know what to do about all of this.  In fact, probably the biggest group of questions I receive from readers is regarding what to do in order to prepare for the economic collapse that is coming.   People are tired of just talking about all of these problems and they want an action plan.

So what is the answer?

What should people do about this coming economic collapse?

Well, when I attended law school I was taught that there is a two word answer to almost any question that someone can ask about the law….

It depends.

And while there are some fundamental principles which we should all follow in getting prepared for the coming economic crisis (which I will share below), the truth is that each and every person has very different circumstances that they are facing, so when someone asks what they should do I give them that same answer….

It depends.

If you have a family you are going to prepare much differently than if you are single.

If you live along the coast you are going to prepare much differently than if you live in the mountains or in the city.

If you are wealthy you are going to prepare much differently from someone who only possesses limited resources.

If you are dependent on a job you are going to prepare much differently from someone who is self-employed.

If you live on a farm you are going to prepare much differently from someone who lives in an apartment building and has never even grown a garden.

The truth is that there are a ton of variables and there just is not a "one size fits all" answer.

However, there are some fundamental principles that we should all be following as we prepare for the coming economic collapse….

Get Out Of Debt

It is always, always, always a good idea to get out of debt, but this is particularly true during a time of economic crisis.  During an economic collapse, it will be very difficult to get work, money will be tight, and the last thing you will want to be doing is to be making monthly payments on some debt that you accumulated five years ago.  The reality is that when we borrow money we become a servant, and debt is a very cruel master.

You especially want to get rid of debt that is at high interest rates (such as credit card debt).  There are very few things that are as good at bleeding your finances as credit card debt is.  For example, according to the credit card repayment calculator, if you have a $6000 balance on a credit card with a 20 percent interest rate and only pay the minimum payment each time, it will take you 54 years to pay off that credit card.

During those 54 years you will pay $26,168 in interest rate charges on that credit card balance in addition to the $6000 in principal that you are required to pay back.  That is before any fees or penalties are even calculated.

Can you see how financially debilitating that can be?

The truth is that if you haven’t already started, now is the time to develop a plan for how to get out of debt.  Paying off debt can be very painful, but it will put you in a much, much better position to weather the financial storms that are ahead.

Reduce Your Expenses

Along the same lines, it is a very good idea to start reducing your expenses right now.  The truth is that you cannot be sure that you will always have the same job or the same level of income.  Times are going to be very tight in the future.  Now is the time to start the belt tightening.

Yes, the truth is that the cost of everything seems to be going up these days, and most American families are already finding it increasingly difficult to get by each month.

But if your household is spending $5000 a month right now, are there ways that you could get that down to $4000 or maybe even $3000?

If we all start learning to live with less right now, it will be much easier to do when times really get hard.

Increase Your Income

Yes, this is much easier said than done.  Especially considering the fact that it seems like there are hardly any jobs out there right now.

But the truth is that we are all going to have to work a lot harder and become a lot less dependent on employers.

It is going to become increasingly difficult to get good jobs in the months and years ahead.  The big global corporations are figuring out that they really don’t need us after all.  In many ways, it is much easier for them to hire a workforce from the other side of the world.

So where does that leave us?

Well, fortunately there are still a lot of ways to make money in America.  How long that will last is uncertain, but for now we should work while the working is good.  We are all going to have to start becoming a lot more entrepreneurial.

Nobody is going to hand you anything in this life.  If you just settle for your job ("just over broke") you aren’t going to get too far in today’s world.

Many people start developing an extra income during their spare time in the evenings after work.  Yes, that would mean that you would have less time to sit on the couch and watch people talk about who LeBron James is going to play basketball for, but did you think that we were going to be able to get through this without making sacrifices?

Now is the time to rise up off the sofa and figure out how to make some more money.  There is still a little more time to get prepared.  If you keep putting off what you know needs to be done, eventually it will be too late.

In addition, learning to do things like growing a garden is another way of "increasing" your income.  All of the fruit and vegetables that you grow will mean that you won’t have to spend as much at the grocery store.

Stock Up On Essentials

There are tons of supplies still in the stores, and prices are still relatively low right now (especially compared to what they will be in the future).  So it is time to stock up on essentials while the getting is good.

In a previous article entitled "20 Things You Will Need To Survive When The Economy Collapses And The Next Great Depression Begins", we listed 20 of the things that you will need in the event of a major disaster, an emergency or an economic collapse.  These are the things that you are going to want to make sure that you have ready right now, because after the crisis begins it may be too late to prepare….

#1) Storable Food

#2) Clean Water

#3) Shelter

#4) Warm Clothing

#5) An Axe

#6) Lighters Or Matches

#7) Hiking Boots Or Comfortable Shoes

#8) A Flashlight And/Or Lantern

#9) A Radio

#10) Communication Equipment

#11) A Swiss Army Knife

#12) Personal Hygiene Items

#13) A First Aid Kit And Other Medical Supplies

#14) Extra Gasoline (But Be Very Careful How You Store It)

#15) A Sewing Kit

#16) Self-Defense Equipment

#17) A Compass

#18) A Hiking Backpack

#19) A Community

#20) A Backup Plan

In the comments to that article, our readers suggested the following additional items….

A K-Bar Fighting Knife

Salt

Extra Batteries

Medicine

A Camp Stove

Propane

Pet Food

Heirloom Seeds

Tools

An LED Headlamp

Candles

Clorox

Calcium Hypochlorite

Ziplock Bags

Maps Of Your Area

Binoculars

Sleeping Bags

Rifle For Hunting

Extra Socks

Gloves

Gold And Silver Coins For Bartering

Of course there are probably many more items you could put on the list.

The point is to get educated, get informed and start getting prepared.

When things get really hard, that brand new pool table isn’t going to do you much good, but having a good supply of food and clean water will make all the difference.

Not that things are going to totally fall apart overnight.  It is going to be a process.

But you don’t start preparing when the storm is already on top of you.

Most of us know what is coming.

Now we need to start taking action.

This is how Americans got through the Great Depression of the 1930s – they tightened their belts, they were resourceful, and they did whatever they needed to do to provide for their families.

Now it is our turn.  Sure some people will laugh as many of us adjust our lifestyles in preparation for hard economic times, but it is those same people who will come knocking on your door when the rain does start pouring.

The Russian Bear Awakens

Today most Americans consider the United States to be "the sole remaining superpower" – absolutely unparalleled economically and militarily.  But the truth is not anything close to that.  As we detailed in a previous article, China has become a very dominant economic and military superpower.  But there is another world superpower that the American people and the American media are not taking seriously.  The Russian Bear has awakened, and yet most people in the U.S. think of Russia as a Cold War opponent that we "defeated" and which is now a shell of its former self.  The recent Russian spy case is a perfect example of the tremendous lack of respect which the American public has for Russia these days.  It is almost as if the media is saying: "Oh look, isn’t it so cute that these little Russians are spying on us as if the Cold War was still going on?"  But the truth is that it is a massive error to underestimate Russia.  Today it is a fact that Russia is stronger both economically and militarily than it ever has been before.     

You doubt this?

Quick – name the number one oil producer in the world.

Here’s a hint – it is not Saudi Arabia.

It is Russia.

Russia has also recently become the number one oil exporter in the world.

Not only that, but Russia is also the number one exporter of natural gas in the world.

In a world starving for oil and natural resources, that puts Russia in a verystrong position.

Back on December 28th, Russian Prime Minister Vladimir Putin was on handto celebrate the opening of Russia’s first modern Pacific-based oil export facilities.  The Pacific port of Kozmino now allows Russia to export huge amounts of oil to growing economies throughout Asia.

And to the United States.

Did you know that Russia is rapidly becoming one of the top suppliers of oil to the United States?

It’s true.

So is it smart for the U.S. to start becoming dependent on oil from Russia?

No, probably not.

But that is what is happening.

And the Russian economy is booming.

Russia experienced very high economic growth during the early part of the past decade, and analysts project Russia’s GDP will grow by more than 5%in 2010.

And most people think of Russian cities as crumbling, broken down cities where people stand in line for bread.

Not anymore.

According to Forbes, Moscow is now the third most expensive cities in the world in which to live.  In fact, the cost of living is higher in Moscow than in any U.S. city.

Who would have thought that it costs more money to live in Moscow than in New York City?

But Russia has not just become an economic superpower once again.

Russia has also been using all of this new economic power to rapidly update and modernize both its conventional and strategic military forces….

*Over the last several years, Russia has been very busy updating and modernizing their strategic nuclear forces.  U.S. officials still claim that America has a technological edge in this area, but everyone agrees that the gap is rapidly narrowing.

*On June 15th, Russia introduced their new "fourth generation" nuclear submarine to the world, which is apparently quieter than any other submarine in existence.

*Not only that, but a couple weeks ago Russian Prime Minister Vladimir Putin climbed into the cockpit of Russia’s new "fifth generation" fighter jetand announced that it was far superior to the F-22 Raptor.

And Russia is once again projecting their strength throughout the world.  We all saw what they were able to achieve in Georgia.  But they have been very busy elsewhere as well….

*Iran announced on Wednesday that the Bushehr nuclear power plant, a joint project with Russia, would be ready for operation in two months.

*Russia has signed major arms deals with Syria under which it will sell Syria warplanes, anti-tank weapons and air defense systems.

*After Russian President Medvedev’s historic visit to Damascus, Russia’s energy minister announced that his country is "studying the question" of building a nuclear power plant in Syria.

*Russian President Dmitry Medvedev recently announced that Russia and Turkey are becoming key strategic partners.

*The Russian government has agreed to a raft of new accords with the new, much more pro-Russian, government in Ukraine.

But still the United States is not taking Russia seriously.

According to Admiral James A. Winnefeld, the commander of the U.S. Northern Command, Russia is continuing to fly strategic nuclear bombers close to U.S. and Canadian airspace because the Russian military is seeking to maintain "the illusion of power".

The illusion of power?

Is he kidding?

It is this dramatic underestimation of Russia power that could end up seriously burning us in the end.

The truth is this lack of understanding of the world situation goes all the way to the top.

Barack Obama is pushing for a plan which would reduce the size of the U.S. strategic nuclear arsenal to about 10 percent of what it was at the height of the Cold War.

Most Americans (and most people who will read this article) simply dismiss Russia as not being a significant threat, but that just shows how misinformed most people are.

And in many ways Russia is in a much better position right now than the United States is.

The Russian government actually ran large budget surpluses from 2001 to 2007 and has a very small national debt.

Meanwhile, the U.S. government has accumulated the biggest debt in the history of the world.

In fact, Russia owns about 100 billion dollars of that debt.

My how the tables have turned.

The frightening thing is that Russia and China are cooperating on a host of economic and military projects as they seek to "counterbalance" U.S. power in the world.

The truth is that the U.S. cannot just "do whatever it wants" in the world anymore.

Russia and China are both more powerful than they have ever been before and they aren’t going anywhere any time soon.

The world has changed.  If the United States does not wake up and recognize this fact there are going to be some very serious consequences.

Recession 2010?

If you watch any mainstream news program these days, it is almost a certainty that someone will mention the word "recession" before a half hour passes.  In fact, it seems like almost everyone is either predicting that we are going into a recession, or they are warning of the need to avoid a recession or they are proclaiming that we are still in a recession.  So will the U.S. economy once again be in recession in 2010?  When you consider all the signs that are pointing that way, the evidence is compelling.  The truth is that there is bad economic news wherever you turn.  There is bad news in the housing industry.  There is bad news in the financial markets.  There is bad news in the banking system.  There is bad news coming out of Europe.  There are even signs that the bubble in China may be about to burst.  Plus, the economic impact of the Gulf of Mexico oil spill could end up being the straw (or the gigantic concrete slab) that really breaks the camel’s back.  So there are certainly a lot of pieces of news that "gloom and doom" economists can hang their hats on these days.  There is a very dark mood in world financial markets right now, and it seems like almost everyone is waiting for the other shoe to drop.  But does all of this really mean that we are looking at the start of another recession before the end of 2010? 

The truth is that nobody really knows.  Things certainly look very ominous out there.  The dark clouds are gathering and the economic winds are starting to blow in a bad direction.  The following are 24 pieces of evidence that do seem to indicate that very difficult economic times are imminent….

-U.S. Treasury yields have dropped to stunning new lows.  So why are they so low?  Well, it is because so many investors are anticipating that we are headed into a deflationary period.  In fact, many economists are warning that the fact that Treasury yields are so low is one of the clearest signs that economic trouble is ahead.

-The Conference Board’s Consumer Confidence Index declined sharply to 52.9 in June.  Most economists had expected that the figure for June would be somewhere around 62.  If consumers aren’t confident they won’t be spending money.  If American consumers don’t start spending money soon a lot of American retailers are going to go belly up.

-The M3 money supply plunged at a 9.6 percent annual rate during the first quarter of 2010.  If the M3 keeps declining at that kind of a rate it is going to put extreme deflationary pressure on the U.S. economy.

-Many economists are now warning that the "China investment bubble" is about to burst.  In fact, Kenneth Rogoff, Harvard University professor and former chief economist of the International Monetary Fund, claims that China’s property market is beginning a "collapse" that will send a shockwave across the globe.  One prominent economist that specializes in China is even forecasting that property prices in major Chinese cities are likely to soon experience a drop of up to 30 percent.

-Nouriel Roubini is warning that Europe’s economy could stop growing as soon as this year.  Back in 2007 and 2008, the U.S. was the epicenter of the financial crisis, but many analysts believe that it will be Europe this time around.

-Vacancies and lease rates at U.S. shopping centers continued to get worse during the second quarter of 2010.  If things don’t pick up soon will we see half empty shopping malls by the time Christmas rolls around?

-CBS News is reporting that the oil spill in the Gulf of Mexico is hurting businesses "from coast to coast".  The longer this oil spill goes on the bigger of an impact it is going to have.  The cost to the American economy from this disaster could ultimately be in the trillions.

-Some analysts are warning that if BP goes under as a result of the Gulf of Mexico oil spill that it could cause the total collapse of the worldwide derivatives market and unleash a liquidity crisis unlike anything the world financial system has ever seen.

-The state of Illinois has stopped paying most of its bills and yet the flood of red ink continues to get even worse.  Illinois now ranks eighth in the world in possible bond-holder default.  That is even worse than California.

-Speaking of California, the Schwarzenegger administration has won an appellate court ruling saying it has the authority to impose the federal minimum wage of $7.25 an hour on more than 200,000 state workersas California wrestles with its latest budget crisis.

-Things are so bad at the state level in the U.S. that economist Mark Zandi is projecting that up to 400,000 workers could lose their jobs in the next year as states, counties and cities struggle with lower tax revenues and significantly reduced federal funding.

-Two Federal Reserve officials recently said that U.S. unemployment is likely to stay high for a long time.  Normally Fed officials are some of the biggest cheerleaders for the economy.  If they are not optimistic about the employment situation that is a very bad sign.

-Analysts are warning that the "death cross" is coming.  The Standard & Poor’s 500 50-day moving average is about to cross beneath the 200-day moving average, and many economists say that this is a very strong indicationthat a new recession is about to begin.

-One prominent trader says that the Dow Jones Industrial Average is repeating a pattern that appeared just before financial markets collapsed during the Great Depression.

-Ambrose Evans-Pritchard, one of the most respected financial columnists in the world, really raised eyebrows recently when he declared that this "really is starting to feel like 1932".

-In the month of May, sales of new homes in the United States dropped to the lowest level on record.

-The National Association of Realtors recently announced that its seasonally adjusted index of sales agreements for previously occupied homes dropped 30 percent in May.

-It is being reported that sales of foreclosed homes in Florida made up nearly 40 percent of all home purchases in the state during the first part of 2010.

-Politicians across Europe have pledged to dramatically cut their national budgets, and many economists are warning that such a dramatic pullback in public sector spending could cause a very significant slowdown of the European economy.

-Banks in the U.K. are being instructed to hoard cash in preparation for the next financial crisis.

-One recent poll found that 76 percent of Americans believe that the U.S. economy is actually still in a recession.

-The average duration of unemployment in the United States has risen to an all-time high.  Millions of unemployed Americans are fighting off deep despair and depression as they find it nearly impossible to find a decent job.

-Small and mid-size banks across the United States are failing at a rapidly accelerating pace.  The truth is that the entire U.S. banking system is teetering on the brink of disaster.

-At this point just about everyone can see the writing on the wall.  Literally dozens of top economists and world leaders are declaring that we are likely to enter the second leg of a "double-dip recession" at some point over the next twelve months.

So yes, things are really, really bad.

Those who want to forecast a coming recession don’t have to look too far for data that will back them up.

But wait.

There is actually one prominent economist who says that it is virtually impossible that the United States will experience a recession in the next six months.

Goldman Sachs economist Andrew Tilton says that there is "no way in hell" that the U.S. economy is going into a recession.  To be more precise, Tilton says that there is a 1.6% chance that the U.S. economy will be in a recession six months from now.

So according to Tilton, there is a 98.4% chance (and he has computer models that supposedly back him up) that the U.S. economy will be growing when we reach the end of the year.

So what is actually going to happen?

Who knows.

The truth is that so many of these economists are so caught up in what is happening in the short-term that they are missing the bigger picture.

The bigger picture is that the U.S. economy is more over-leveraged than it ever has been before, and we are caught in a debt spiral that is basically impossible to unwind.

So in the final analysis it really doesn’t matter if we are "officially" in a recession by the end of 2010 or not.  The truth is that the United States is headed for a devastating long-term economic collapse and there isn’t much that anyone can do to change that reality at this point.

Advertisements