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I would like to revise and extend my previous post insofar as the U.S. is approaching third world status in at least one activity: education. U.S. falls in education rank compared to other countries | The Kapio
NEW STUDY FINDS U.S. MATH STUDENTS CONSISTENTLY BEHIND THEIR PEERS AROUND THE WORLD
Mandate for Leadership: 15. Improving Education
The LA Times reports Los Angeles is on its way to becoming "a third world city."
I don't know about "third world" but every time I've been to LA it has been a "different world." :DQuote:
"The question is, are we going to be a 21st century city with shared prosperity, or a Third World city with an elite group on top and the majority at poverty or near poverty wages?" asked Ernesto Cortes Jr. Southwest regional director of the Industrial Areas Foundation, a leadership development organization. "Right now we're headed toward becoming a Third World city. But we can change that."
These are the "REAL" facts. Not the FAUX facts.
“…the still-unfolding banking solvency crisis has confirmed the Fed's and the U.S. government's willingness to spend whatever money they have to create in order to keep the financial system from imploding.”
“The circumstance envisioned ahead is not one of double- or triple- digit annual inflation, but more along the lines of seven- to 10-digit inflation seen in other circumstances during the last century.”
“The historical culprit generally has been the use of fiat currencies — currencies with no asset backing such as gold — and the resulting massive printing of currency that the issuing authority needed to support its system, when it did not have the ability, otherwise, to raise enough money for its perceived needs, through taxes or other means.”
“The United States is no exception, already having obligated itself to liabilities well beyond its ability ever to pay off.”
“Hyperinflation: Extreme inflation, minimally in excess of four-digit annual percent change, where the involved currency becomes worthless. A fairly crude definition of hyperinflation is a circumstance, where, due to extremely rapid price increases, the largest pre-hyperinflation bank note ($100) becomes worth more as functional toilet paper than as currency.”
“The current economic contraction is about halfway towards being classified as a 'depression.'”
“Official CPI could be running in double-digits by year-end 2008.”
“The U.S. economy has been in a recession since late-2006, entering the second down-leg of a multiple-dip economic contraction, where the first down-leg was the recession of 2001 that really began back in late-1999. Annual CPI inflation currently is running around 11.6%, again, facing further upside pressures.”
“The evolving depression quickly will move to great-depression status, when the hyperinflation hits. It will be extremely disruptive to the conduct of normal commerce.”
“Ongoing M3 currently shows a record annual growth rate of 17.3%.”
“In the near future, dollar selling should build towards an extreme, with heavy foreign investment in the dollar fleeing the U.S. currency for safety elsewhere. With the domestic financial markets and U.S. Treasuries so heavily dependent on foreign capital for liquidity, the Federal Reserve — now touted as the formal financial market stabilizer — will be forced increasingly to monetize federal debt. That process will build over time, given the federal government's effective bankruptcy.”
“Again, the current circumstance will evolve into a hyperinflationary depression, then a great depression. Although such is not likely much before 2010, or after 2018, the financial end game for the current markets will tend to come sooner rather than later and will break with surprising speed when it hits.”
“2008 will favor an incumbent party loss, i.e. a victory for the Democrats.”
“What promises hyperinflation this time is the lack of monetary discipline formerly imposed on the system by the gold standard, and a Fed dedicated to preventing a collapse in the money supply and the implosion of the still, extremely over-leveraged domestic financial system.”
“The limits to the unlimited abuse of the debt standard are particularly evident in the GAAP-based financial statements of the U.S. government, which show the actual federal deficit at $4.0-plus trillion for 2007 alone, with total federal obligations standing at $62.6 trillion. With no ability to honor these obligations, the government effectively is bankrupt.”
“Although the U.S, government faces ultimate insolvency, it has the same way out taken by most countries faced with bankruptcy. It can print whatever money it needs to create, in order to meet its obligations. The effect of such action is a runaway inflation — a hyperinflation — with a resulting, full debasement of the U.S. dollar, the world's reserve currency.”
“Oil prices are near historic highs, the dollar is near historic lows, and money growth is at an all-time high. The near-term outlook for all three is for new record levels and for extremely strong upside pressure on U.S. inflation. … gold prices should continue setting new historic highs.”
“The difference is in accounting … for unfunded Social Security and Medicare liabilities.”
“Put into perspective, if the government were to raise taxes so as to seize 100% of all wages, salaries and corporate profits, it still would be showing an annual deficit using GAAP accounting on a consistent basis. In like manner, given current revenues, if it stopped spending every penny (including defense and homeland security) other than Social Security and Medicare obligations, the government still would show an annual deficit.”
“U.S. federal obligations are so huge versus the national GDP that the country's finances look more like those of a banana republic than the world's premiere financial power and home to the world's primary reserve currency, the U.S. dollar.”
“The effect of this structural change has been that most consumers have been unable to sustain adequate income growth beyond the rate of inflation, unable to maintain their standard of living. The only way personal consumption can grow in such a circumstance is for the consumer to take on new debt or liquidate savings. Both those factors are short-lived and have reached untenable extremes.”
“From the Fed's standpoint, it can neither stimulate the economy nor contain inflation. Lowering rates has done little to stimulate the structurally-impaired economy, and raising rates may become necessary in defense of the dollar.”
“By the time hyperinflation kicks in, the economy already should be in depression, and the hyperinflation quickly should pull the economy into a great depression. Uncontained inflation is likely to bring normal commercial activity to a halt.”
Hyperinflationary Great Depression
“In the United States, the printing presses have not been revved up heavily yet, but the commitments are in place, as seen in the annual GAAP-based deficit running on average more than $4.0 trillion per year. That amount is far beyond the ability of the government to tax or the political willingness of the government to cut entitlement spending. While the inevitable inflationary collapse, based solely on these funding needs, could be pushed well into the next decade, actions already taken likely have set the stage for a much earlier crisis.”
“It is this environment that leaves the U.S. dollar open to potentially such a rapid and massive decline, and dumping of U.S. Treasuries, that the Federal Reserve would be forced to monetize significant sums of Treasury debt, triggering the early phases of a monetary inflation. In this environment annual multi-trillion-dollar deficits rapidly would feed into a vicious, self-feeding cycle of currency debasement and hyperinflation.”
“Given the extremely rapid debasement of the larger denomination notes, with limited physical cash in the system, existing currency would disappear quickly as a hyperinflation broke. From a practical standpoint, however, currency would disappear, at least for a period in the early period of a hyperinflation.”
“Barter System. With standard currency and electronic payment systems non-functional, commerce quickly would devolve into black markets for goods and services and a barter system.”
“Gold and silver both are likely to retain real value and would be exchangeable for goods and services. Silver would help provide smaller change for less costly transactions.”
“In such a circumstance, gold and silver would be primary hedging tools that would retain real value and also be portable in the event of possible civil turmoil. Also, at some point, the failure of the world's primary reserve currency will lead to the structuring of a new global currency system. I would not be surprised to find gold as part of the new system, in an effort to sell the system to the public.”
“I still look for U.S. stocks to take an ultimate 90% hit, peak-to-trough, net of inflation, during this period.”
Ruff Times subscribers who accept John's scenario have no downside! At the worst, if Scenario number one occurs, they will make tons of money in gold and silver, then we will eventually put out a sell order and the world will return to relatively normal. If I and John Williams are right, it will literally save your current lifestyle, and perhaps even your lives.
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Howard J. Ruff, the legendary author and financial advisor, has re-edited and will re-issue his 1978 mega best seller, How to Prosper During the Coming Bad Years, still the biggest-selling financial book in history, with 2.6 million copies in print. He is founder and editor of The Ruff Times Financial Newsletter. This article appeared in the April 18, 2008 issue of The Ruff Times. The newsletter is much more comprehensive and deals with a broad spectrum of middle-class financial issues and includes an Investment Menu from which you can build your portfolio. You can learn about it here). The Ruff Times has served more than 600,000 subscribers – more than any financial-advisory newsletter in the world.
And yet, the first quarter GDP still grew. Looks like the recession preachers will have to spin this one - oh wait, al-AP already has... "Economy grows by only 0.6 percent in first quarter." And, oil is down, supplies are up, gasoline demand is down and the dollar got stronger.
Steve you are ruining a perfectly good narrative. Don't you know we are already in recession ? Everyone says so .
Sorry tom, I don't know why I always have to have to have such a negative attitude. :DQuote:
Originally Posted by tomder55
Headline should read : 'Economy Grows Much Faster Than Expected' . Or 'Economy Exceeds Expectations'Quote:
Also gold prices are going through a "correction " and have dropped almost $150 /oz from it's high last month.
Reuters was more positive, WRAPUP 1-U.S. first-quarter growth stronger than forecast - as was Xinhua: Wall Street higher on upbeat GDP data. Come back home though and you get this:Quote:
Originally Posted by tomder55
LA Times: GDP grows just 0.6% for second consecutive quarter
Preliminary Commerce Department data confirms predictions of an economic slowdown for 2008. A drop in personal consumption is a big reason for the slump.
CNN: Economy: It could have been a lot worse
It's hard to get excited about 0.6% growth but at least GDP didn't fall in the first quarter. But can the economy avoid a drop in the second quarter?
Or even close to home, Canadian Economic Press - U.S. Preview: First Quarter GDP to Come in Flat
Not so fast Cowboys. George "Dubya" Bush has made some blunders in two terms, but he knows the writing on the wall when he sees it and that's why his stimulus package (that he supported) went through Congress. The overall numbers and direction that brought to light this issue happened in late February and has trended through March. March being the last month in the first quarter and that's why your president of choice, the congress, the Feds, and numerous economists are concerned.
GDP Says Economy Grew, Avoided Recession | Market Features | BSC FNM FRE GS JPM LEH MER - TheStreet.com
""The Fed is still looking for a weak growth profile for this year, and everyone is just waiting to see whether the stimulus from fiscal and monetary policy will bring growth back to trend or not," says Pandl [Lehman Brothers].
Tax rebates, which are the centerpiece of the government's $168 billion stimulus package enacted in February, are now going out the public in an effort to boost consumer spending and confidence. It remains a question mark whether the rebates, which range from $300 for individuals to $1,200 for couples, can stimulate the economy.
"The GDP report does confirm that the economy overall remains very weak with overall activity flat if not declining outright," Pandl says. "We continue to believe that the early part of 2008 will go down in history as the start of a mild recession."
On Tuesday, Standard & Poor's reported that its Case-Shiller home price index of 20 cities fell by 12.7% in February versus last year, the largest decline since its inception in 2001. Seventeen of the 20 metro areas reported record annual declines.
Also, the Conference Board said that its Consumer Confidence Index, which declined sharply in March, fell again to 62.3 in April, down from the revised 65.9 last month and 76.4 in February. The consumer sentiment index, tracked by the University of Michigan, has also dropped to its lowest levels in over a quarter-century after the U.S. recorded three-straight months of declines in the job market.
Meanwhile, the components of Wednesday's GDP report from the Commerce Department did show some worrisome signs. Consumer spending, the nation's chief engine of economic growth, rose by just 1% for the quarter, down from the 2.3% growth rate in the previous quarter, which was the slowest reading since the second quarter of 2001."
Yeah they are not satisfied with the growth of the economy. 0.6 % is almost flat but it is not the recession which all the pundits predicted .
One of the info-babes was obsessing over Bush's refusal to use the "r" word while discussing the U.S. economy during the newsconference earlier this week.Quote:
Originally Posted by tomder55
Hello I:
Buy gold. It's cheap now.
excon
They? That would be the President, the Congress, the Feds, numerous highly educated economists, and a country of people that have endured job loses, record foreclosures, and inflation. I think they should be moderately skeptical. I'm giving out my address to those that want to send me their stimulus checks. :)Quote:
Originally Posted by tomder55
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