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America’s declining living standards, You haven’t seen anything yet
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There is too much to write these days…but I am choosing not to write anything more. Simply because there is too much of good stuff to share rather than me writing something new. Therefore, I plan to write less and share more of what I read that will give you an idea of where the USA in particular and the world in general are heading.
First, something from my earlier blog: “Major world changing events are now underway and your preparation for the uncertain future is extremely urgent. Such preparations take years to complete, the question is – do we have enough time going forward? Financial nuclear meltdown of the US Dollar (and other major currencies) is in progress…that will wipe out wealth of millions of middle class families world over. There will be no place to hide when the meltdown completes. Prepare my friends Prepare…while the time is still on your side!!! Don’t say you were not warned…”
Tick..Tick..Tick…The Debt bomb is ticking
Over the last few decades a gigantic debt bubble fueled tremendous amount of “fake prosperity” in the western world. Now the “prosperity” is almost gone and the Debt bomb has started ticking. The Debt crisis has not even started yet (in terms of the total amount of middle class savings/wealth destruction). This crisis can only be ended by a massive upside revaluation of Gold. Gold and Silver have a lot more to rise in the future (as always, I wish I am wrong in my predictions…unfortunately I don’t see any sign of that yet.) Let us hope for the best, but let us also prepare for the worst
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I have divided this blog into two sections – 1) The current news that will tell you where the world economy is heading and 2) How the American society is changing – The early signs of the times to come.
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1) The current news that will tell you where the world economy is heading
‘Act now’ to save global recovery, IMF chief urges…”Developments this summer have indicated we are in a dangerous new phase,”
Video: THE MADNESS OF A LOST SOCIETY 2 : FINAL WARNINGS
Slums in other countries are called Tent cities in USA: Evidence for the accelerating disintegration of the USA is everywhere. As millions of people lose their houses, their jobs, their life savings and more, it is inevitable that shanty towns and squatter settlements would spring up, and so they have, all over the USA. Economic Woes Lead to Proliferation of Tent Cities Nationwide
Flash Crash: The financial order will go down hard. It will collapse in total ruins like the World Trade Center Towers in New York City. He calls it the “Flash Crash” that is being done by expert “architects of destruction,” operating beyond any governmental control. Perhaps he is right.
Where is Gold and Silver going? Don’t know? Go figure it out…$8,000 Gold & $500 Silver, MINUMUM. (That would be Rs. 1,25,000 / 10gm of Gold and Rs. 5,00,000 / Kg of Silver in India, provided the USD / Rupees exchange rate remains where it is today.)
Stock prices will not recover to their 2010 highs until 2027 – So what will happen to your 401K account? Many may scoff at the Fed’s report that stock prices will not recover to their 2010 highs until 2027.
‘Very Muted Growth’ Coming for Next 10 Years: Faber – In such a slow-growth environment, Faber prescribed a diversified mix for portfolios—25 percent to 30 percent in stocks, 20 percent to 30 percent in physical gold—”in a safe deposit box ideally outside the U.S. in various locations” because “I don’t trust anyone”—some cash, and up to 30 percent in real estate, particularly in Asia. “I think it’s important in today’s very uncertain world to diversify not only in various asset classes…but also the custody of your assets should be in different jurisdictions,” he said
Ron Paul: Mobs In Europe A Sign Of Things Coming…
Welcome to the Third World: One upon a time, the US was a place where police came when you called, a basic safety net caught those who fell on hard times, and a lifetime of work was rewarded with a decent retirement. A First World country, in other words. To be born here was to win life’s lottery. But apparently this was an illusion fueled by borrowing and money printing, and now that we can’t borrow quite so much, many things we took for granted are going away. Welcome To The Third World
Two Russian scientists warn of imminent, major cataclysm: the first of three episodes, beginning the last week of this month, mere days from now. Are they right? We shall know soon. If no major cataclysms occur over the next couple of weeks, then they are wrong, at least in part. If no major cataclysms occur at all over the next couple of years, then they are just completely blowing smoke. But the mega-earthquakes in Japan this year, and in Sumatra in 2004, show that we are, indeed, in a period of major, geological instability, so we shall see whether the Russians are on to something.
Thousands Camp Out for Job Fair as Jobless Rate Rises: Thousands of unemployed waited overnight, camping out in their business suits and office heels and braving the tormenting heat in Atlanta to stand in line for a job fair Thursday.
Postal Service considers cutting 120,000 jobs: Facing a second year of losses totaling $8 billion or more, the agency also wants to pull its workers out of the retirement and health benefits plans covering federal workers and set up its own benefit systems. The post office has cut 110,000 jobs over the last four years and is currently engaged in eliminating 7,500 administrative staff.
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2) How the American society is changing – The early signs of the times to come…
The links below are not the ordinary crimes, they are a direct result of the changing economic times in the United States of America. These type of crimes were always associated with the so called third-world-countries….but no more. They are happening right here and right now. These crimes were extremely rare in the Land of the Free and Home of the Brave - in the superpower of the United States of America..Unfortunately, the times are changing.
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Newlyweds stole food for wedding reception: A couple of Pennsylvania newlyweds are behind bars after police say they were caught shoplifting food from a supermarket for their wedding reception. The Centre Daily Times reports 32-year-old Arthur Phillips III and his bride, 22-year-old Brittany Lurch, were arrested Saturday after taking more than $1,000 in merchandise from a Wegmans supermarket in State College.
Woman ‘encouraged husband to have sex with 12-year-old girl so that she would get pregnant and they could claim more benefits’ Alicia Bouchard even sat and watched while her 26-year-old husband had sex with the underage girl at their Florida home. According to an arrest warrant, the 41-year-old wanted the girl to fall pregnant so that she and her husband would have extra income from state benefits.
Kansas City sets youth curfew…There have been other so-called “flash mob” gatherings of youngsters in Kansas City in recent years, but the weekend shootings pushed the issue to the top of the council’s agenda. Kansas City sets youth curfew…
Man Asks Pedestrian for $1, Stabs Him Repeatedly When He Says No… Nassau County police say the 27-year-old victim was walking on Nassau Road in Roosevelt Monday evening when the suspect approached and asked him for one dollar. The victim said he didn’t have any money and continued walking. Police say the suspect followed him and then pulled out a knife and stabbed him in the stomach and hand multiple times.
Disabled woman beaten, robbed by woman offering to help load groceries… Canady said she was grateful when Wilson came over to help, because she’s disabled and has difficulty reaching some items. “I thought that girl fell right out of heaven,” said Canady. “I needed help this afternoon.” But what happened next caught Candy by surprise. When she got in the driver’s seat and started the car to provide air conditioning, Metts said Wilson hit Canady in the forehead with a can she had taken from the grocery bags. “It was so fast, I’m telling you”
Jobless Arizona bank robber says he “stole to survive”… A jobless man accused of robbing a dozen banks across the Phoenix valley told investigators he did it to survive and that “desperation was a great motivator,” authorities said on Tuesday
Armed Woman Climbs Through WHITE CASTLE Drive-Thru Window, Steals Cash Drawer…
VIDEO: Pack of black girls rob DC store…For the second time in a week, a flash mob robbed a convenience store in our area. Could it be a new trend in the Washington region? In the latest incident, 10 girls stormed the Shop Express convenience store along Benning Road in northeast Washington.
Thieves Lift Six A/C Units Over 6-Foot Fence At Church… Churchgoers at one Ft. Lauderdale church are praying for a miracle after all six of their building’s air conditioner units were stolen. According to Pastor Marc Gererd last week Wednesday at least two people stole an air conditioning unit from the First Interdenominational Haitian Church at
LA: Thieves Steal At Least 113 Bronze Vases from Cemetery…According to authorities, at least 113 bronze flower vases, which were attached to headstones, have been stolen in July at Eternal Valley Memorial Park & Mortuary in Newhall.
2 Men Arrested For Stealing Guard Rails From Roadway… Deputies began patrolling the area around Shawmut Road near Chinese Camp earlier this week after getting report that a section of guard rail worth about $2,000 was missing. Early Thursday morning, Deputy Paul Speers arrested 47-year-old…
Man tries to sell stolen sewer grates at scrap yard… A man trying to collect money at a local scrap yard in exchange for iron sewer grates was arrested Thursday morning on a felony theft charge, police said.
Thieves ransack DC Firehouse… Also missing were keys, wallets and a camera, according to the police report. The ripped-off BMW was the personal car of a firefighter.
This is not about America..but this is where most of the societies of this world are heading to. Are you prepared for the future?
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Written by M Joshi
Why do I write all this? I just want to make, all those interested, aware about where we as a society are heading, so that they can protect their future generations to a possible extent. It is going to be very very ugly before it will be better. In my view, our children's world is going to be entirely different than what we have seen. We have already consumed the resources of our future generations. What we have left for them is an empty bag and the consequences of our actions (without the knowledge that it is us who are responsible for the mess our children will be in) ...while I write this I also wish that I am absolutely wrong...and our future generations will live in a better world than ours. DISCLAIMER: All the content of my blogs is presented for educational and/or informational purposes only. Under no circumstances should it be mistaken for professional investment advice, nor is it intended to be taken as such.
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Filed under: America, Economy, World · Tags: America, Collapse, Debt, Economy, Gold, Silver
Mr Joshi – You almost made me run out and buy up all the tinned food and ammunition I can find. You have a point but there is no need to panic. The public finances of the developed countries are in a mess but the private sector is very strong. American public debt of the federal government amounts to just about 100% of their GDP but the private sector is strong – Apple alone has $76billion of cash and Microsoft a similar amount I think. There is therefore a lot of life left in the American economy. However you still have stupid politicians – in spite of the high public debt, Obama is still talking about tax cuts for the middle class – they are nuts. Also why measure public debt against the GDP. Should it not be measured against government revenue. Measured this way their public debt is 700% of GDP. I don’t think America and Europe will collapse. They will decline but no collapse. A collapse is unthinkable. And yes their prosperity was an illusion. In years gone by, they could finance their lavish lifestyle by plundering other countries economies – India, South America and Africa and they might just end up doing this again.
My comment – “public debt is 700% of revenue”.
Debt-to-GDP measures the financial leverage of an economy; some economists, such as Steve Keen, advocate using it as the key measure of a credit bubble (both its level and its change – particularly of private debt and total debt), and high levels of government debt (public debt) are widely decried as fiscal irresponsibility.
One of the Euro convergence criteria was that government debt-to-GDP be below 60%.
World Bank and IMF hold that “a country can be said to achieve external debt sustainability if it can meet its current and future external debt service obligations in full, without recourse to debt rescheduling or the accumulation of arrears and without compromising growth.” According to these two institutions, external debt sustainability can be obtained by a country “by bringing the net present value (NPV) of external public debt down to about 150 percent of a country’s exports or 250 percent of a country’s revenues.” [1] High external debt is believed to have harmful effects on an economy.[4]
There is difference between external debt nominated in domestic currency, and external debt nominated in foreign currency. A nation can service external debt nominated in domestic currency by tax revenues, but to service foreign currency debt it has to convert tax revenues in foreign exchange market to foreign currency, which puts downward pressure on the value of its currency. So all of the money used to service foreign currency debt has to come from a country’s balance of payments transfers
Source: http://en.wikipedia.org/wiki/Debt-to-GDP_ratio
Mr.Sam,
I wish what you say comes out to be true. Obviously, since my fortunes are ties to America I shall be benefitted if things don’t go down where I think they are heading.
Whether collapse or not, one thing is almost certain – “Wipe-out of the middle class all over the world” and that is what my warnings are about. They are not about the collapse but how to protect the weatlh in the coming wipe-out-of-the-middle-class-phase.
Here is something you may want to read (again all these are opinions of individual writers and not necessary everyone agrees with them)
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The Counterfeit Culture – Useful Observations for Understanding why Collapse is Inevitable
Through a devolving web of greed, self-serving power and a departure from fundamental ethics, Western culture has, over the last hundred years, become the counterfeit culture.
Nothing is real anymore – not the food, not the money, and certainly not the evening news. And because it’s not real, it’s not sustainable. That’s why it’s headed for collapse, which is all too real, as many people are about to find out.
In the mean time, here are some observations about the counterfeit culture in which we all frustratingly find ourselves. It’s all about corporations, governments and institutions being “in the business of” counterfeiting something – faking something or pretending to create something of value when they really aren’t. Ring a bell?
http://silverbearcafe.com/private/08.11/counterfeit.html
Thanks
M.Joshi
I don’t think a handful of individual crimes indicates anything about the American way of life. I bet if you look with an unbiased eye, you’d find several examples of people who deal with the recession quite well. Your examples, I’m sure, are the exception not the norm.
Anon – there is a point somewhere in you comment but I don’t get it. It sounds like smoke and mirrors to me. It does not matter what the ratio of debt to exports or GDP is – the question is whether you can pay your debts or sustain your lifestyle. The US is heading for a stage where it cannot. Of course since debt is denominated in dollars the US could just print the dollars and pay off their debt by next month but this would make the dollar into a worthless currency. The Roman empire found itself in the same position before it collapsed. To understand what is going on now, I recommend that you read Joseph Tainters book “The collapse of complex societies”. He shows mathematically how complex societies destroy themselves when their activities become unsustainable. Like Mr Joshi has pointed out, unsustainable activities lead to collapse – like spending 20% of your budget on the army using borrowed money.
Mr Joshi – I think the reasons for the precarious situation America finds itself in is varied and cannot just be attributed to the “counterfeit culture”. When trying to understand the world we humans sometimes oversimplify things and look for a single peg to tie our explanations to. The tragedy here is that great American thinkers like John Kenneth Galbraith, pointed out the folly in the American economy in the 60′s already. “Do we really have to eat so much and consume so much”. Americans are obsessed with consumption” he said. Even while the federal government is not raising enough to pay its bills, Obama is promising “to put more money in the pockets of the middle class” and here is the problem. Americans will only vote for politicians who promise more and more. Thanks for the references – will check it out.
@ Sam says:
September 4, 2011 at 1:02 AM
If you didn’t get the point it’s because you missed the most important point in the Wikipedia article. Here it is:
“…by bringing the net present value (NPV) of external public debt down to about….250 percent of a country’s revenues.”
That’s what you should have paid attention to. Tax rates were higher under Clinton. Bush tax cuts have kept tax revenues down while
debt – including paying for two wars – has been piling up. For one thing, tax rates will have to go back to the levels of the Clinton administration. 43.4 percent of employed people do not pay any federal income taxes at all or they receive a refund check from the government. Then there are the big corporations who pay little or nothing. Increase in taxes has to be accompanied by spending cuts. Most of the money spent goes to the military, Social Security and Medicare.
The problem is not all that simple either. When 14 million are unemployed the government will have to pay them unemployment insurance. It will not be able to collect any taxes from them. Another estimated six million are underemployed. Outsourcing of manufacturing and service sector jobs for some thirty years and oil imports are other major contributors to the state of the economy and the high unemployment and underemployment.
I don’t believe that book you studied highlighted any of this to be of use.
http://www.cbsnews.com/stories/2009/04/15/politics/otherpeoplesmoney/main4945874.shtml
Well researched and well written article / blog
Just take a look at Detroit, Michigan – the center of automobile manufacturing and a major center for employment. Today, houses in Detroit can be bought for $ 35,000 because there are no buyers.
I have an American friends with a PhD from MIT who is sitting unemployed. Another friend of mine who is a Harvard undergrad in Eonomics and an MBA from Wharton was unemployed for nearly 10 years. Now he has a job with an Indian company in the USA.
Earlier, full classes from IITs came to the USA. No nobody from an IIT wants to come to the USA because they have better opportunities in India.
Many smart Indins left the USA to return to India as did many smart Chinese return to China. The reverse brain drain is on. Americans and westerners from Europe are working in Bangalore, Hyderabad and Chennai on local Indian salaries and are happy in India.
Things have become really bad in America. Bush junior started the trend downwards and Obama has only accelerated it.
Rajat
When are you going back to India like those other smart Indians who left USA to return home? What about M. Joshi – is he not one of the smart Indians like you too?