The Federal Reserve Is Not Going To Save Us From The Great Depression That Is Coming

Federal Reserve Chairman Ben Bernanke delivered his annual address to Congress on Tuesday, and he did very little to give lawmakers much confidence about where the U.S. economy is heading.  Bernanke told members of Congress that recent economic data points “suggest further weakness ahead” and that the Federal Reserve is projecting that the U.S. unemployment rate will remain at 7 percent or above all the way through the end of 2014.  Now, it is important to keep in mind that Federal Reserve forecasts are almost always way too optimistic.  The actual numbers almost always end up being much worse than what the Fed says they will be.  So if Bernanke is saying that the U.S. unemployment rate will be 7 percent or higher until the end of 2014, then what will the real numbers end up looking like?  During his testimony, Bernanke seemed unusually gloomy about the direction of the U.S. economy.  He seemed resigned to the fact that there really isn’t that much more that the Federal Reserve can do to stimulate the U.S. economy.  Yes, the Federal Reserve could try another round of quantitative easing, but the first two rounds did not really do that much to help.  The truth is that the United States is absolutely drowning in debt, and when that debt bubble finally bursts the Federal Reserve is simply not going to be able to save us from the Great Depression that will happen as a result. (Read More...)

19 Warnings About A Coming Global Financial Catastrophe

Global leaders have tried just about everything that they can think of, but the coming global financial catastrophe continues to march steadily toward us.  We have seen “stimulus packages”, quantitative easing, bond buying, interest rate cuts, emergency economic summits, bailout packages for banks, bailout packages for entire nations, “Operation Twist”, unprecedented government intervention in business and massive amounts of new government debt and yet nothing seems to revive the global economy.  In fact, it looks like we are rapidly heading into the second dip of a “double dip recession”.  Unfortunately, many believe that this next dip will be more like a full-blown depression.  All over the world, top economic experts are warning that we are facing an unprecedented crisis of debt and insolvency that will result in a global financial catastrophe.  The eurozone is drowning in debt, the U.S. government is drowning in debt and major banks all over the globe are drowning in debt.  Global authorities have been trying to patch the system together and keep it going, but the incredible damage that all of this debt has done is now becoming apparent to everyone.  The global debt bubble that has fueled prosperity in the western world for the last several decades is getting ready to burst, and when that happens the chaos that will result will be absolutely horrifying. (Read More...)

20 Signs That Europe Is Plunging Into A Full-Blown Economic Depression

An economic nightmare is descending on Europe.  With each passing month, the economic numbers across Europe get even worse.  At this point it is becoming extremely difficult for anyone to deny that Europe is plunging into a full-blown economic depression.  In fact, some parts of Europe are already there.  In Spain the overall unemployment rate is over 22 percent, and in Greece one out of every five retail establishments has already been closed down.  All over Europe, economic activity is rapidly slowing down, unemployment is skyrocketing and bad debts are unraveling.  It isn’t even going to take a default by a nation such as Greece or a collapse of the euro to push Europe into an economic depression.  All Europe has to do is to stay on the exact path that it is on right now and it will get there.  Normally, European governments would respond to an economic slowdown by increasing government spending.  But this time most of them are already drowning in debt.  Instead of increasing government spending, most governments in Europe are actually cutting back.  All over Europe, national governments are being encouraged to implement even more tax increases and even more budget cuts.  The hope is that all of this austerity will help solve the nightmarish sovereign debt crisis that Europe is facing.  But unfortunately, all of these tax increases and budget cuts are also going to involve a tremendous amount of economic pain. (Read More...)

Financial Panic Sweeps Europe As The Head Of The IMF Warns Of A “1930s Depression”

Are we on the verge of another Great Depression?  Christian Lagarde, the head of the IMF, said this week that if dramatic action is not taken immediately we could actually see conditions “reminiscent of the 1930s depression” and that no country on earth “will be immune to the crisis”.  Right now, financial panic is sweeping across Europe, but most Americans are not too concerned about it because they simply don’t understand how important the EU is.  The truth is that the EU has a much larger population than the United States does.  The EU has an economy that is nearly as large as the economies of the United States and China combined.  The EU has more Fortune 500 companies that the United States does, and the banking system of Europe is substantially larger than the banking system of the United States.  Anyone out there that believes that a massive financial collapse in Europe would not dramatically affect the rest of the globe is being delusional.  The European debt crisis is one of the biggest stories that we have seen in a long, long time and the coming financial meltdown is going to permanently change the global economy. (Read More...)

16 Reasons To Feel Really Depressed About The Direction That The Economy Is Headed

If you do not want to feel really depressed, you might not want to read this article.  The U.S. economy is coming apart at the seams, and there are a whole lot of indications that things are about to get even worse.  After a time of relative stability, the pace of job cuts is starting to pick up again, inflation is rising but paychecks are not, the U.S. housing crisis shows no signs of ending, millions of American families are drowning in debt and all of the recent polls show that the faith of the American people in our economy is eroding.  As you read the statistics in this article, try to keep in mind that there are scores of families from coast to coast that are barely surviving from month to month.  It can be a soul-crushing experience to work as hard as you can and yet just barely be able to pay the mortgage and put food into the mouths of your kids.  The reason why so many Americans believe that we are in a “recession” or a “depression” is because that is what they feel like they are living through every single day. (Read More...)

The End Of An Empire And The Beginning Of A Depression

Since the end of World War 2, the United States has been the leading military power and the leading economic power on the entire globe.  The U.S. has had the largest economy in the history of the world, the U.S. dollar has been used by nearly all of the nations on earth as a reserve currency and the U.S. military has had a physical presence in most of the countries on the planet.  Today, the U.S. military is in approximately 130 different nations and it has a total of about 700 military bases around the world.  But just like the Roman Empire, the U.S. empire has become overextended and it is starting to decline.  Most of our politicians believe that we can continue to “police the world” and project our power to every corner of the globe, but the more we meddle the more the rest of the world hates us and the worse our financial problems get.  America is now swamped with debts and our influence is fading.  The truth is that what we are witnessing is the end of an empire and the beginning of a depression. (Read More...)

It’s Beginning To Look A Lot Like 1930

An increasing number of economists, world leaders and financial columnists are beginning to acknowledge that our current economic crisis bears a striking resemblance to what was going on about the time the Great Depression of the 1930s started.  Just like the “Roaring 20s”, the American people over the last couple of decades have been getting into massive amounts of debt in pursuit of the American Dream.  But just like the early 1930s, we are now experiencing a severe credit crunch and the process of deleveraging this gigantic mountain of debt promises to be at least as painful as the deleveraging that took place throughout the 1930s.  It seems like almost everyone is using words like “double dip” and “recession” now, and a lot of analysts are even starting to utter even more dreaded words like “deflation” and “depression”.  Even the Federal Reserve, usually one of the biggest cheerleaders for the economy, is now saying that the U.S. economic system may not recover for another five or six years.  If that is what the Federal Reserve is admitting to, then how bad are things really?  The truth is that it really is beginning to look a lot like 1930 out there. (Read More...)

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