Posted on 02/21/2010 3:10:51 PM PST by Berlin_Freeper
Most Americans believe that the U.S. economy will fully recover from this recent recession and will soon become stronger than ever. But that is definitely not what is happening. The truth is that the very foundations of the U.S. economy are coming apart and we are headed for a massive amount of financial trouble as a nation.
Collectively, the U.S. government, U.S. businesses and U.S. consumers have piled up the biggest mountain of debt in the history of the world. This mountain of debt has enabled us to enjoy a spectacular standard of living for the past several decades, but now the bills are coming due and nobody seems to even realize how great of a financial disaster the U.S. now finds itself in the middle of.
The following are 10 huge flashing danger signs that show just how much of a mess the U.S. economy is in....
#1) The FDIC is opening a satellite office in the Chicago area that will accommodate up to 500 temporary staffers and contractors to manage receiverships and liquidate assets from what they are expecting will be a massive wave of failed Midwest banks.
#2) The U.S. Treasury Department announced on Tuesday that foreign holdings of U.S. Treasury securities fell by $53 billion in December, which is the biggest one month decline in history. China alone reduced its holdings of U.S. Treasuries by $34.2 billion. So if foreigners quite buying up all of our debt, what happens then?
#3) Mortgage defaults in the U.S. have continued to hit record highs and housing prices are continuing to fall. Now, a massive "second wave" of adjustable rate mortgages is scheduled to reset beginning in 2010. The first wave of adjustable rate mortgage resets absolutely devastated the U.S. housing market in 2007 and 2008. So what is this second wave of mortgage resets going to do to the U.S. economy?
#4) In fact, one new study estimates that five million houses and condominiums will go through foreclosure over the next few years. Needless to say, that would be absolutely catastrophic.
#5) The number of Americans who are declaring bankruptcy continues to skyrocket. 1.41 million Americans filed for personal bankruptcy in 2009 which represented a 32 percent increase over 2008.
#6) But how can Americans pay their bills without jobs? In some areas of the United States it is now nearly impossible to get a really good job unless you have an inside connection. In fact, the mayor of Detroit estimates that the real unemployment rate in his city is approximately 45 to 50 percent.
#7) America needs jobs, but soaring unemployment insurance taxes are discouraging small and mid-size companies from bringing on more workers. According to the National Association of State Workforce Agencies, companies in at least 35 states will have to fork over even more in unemployment insurance taxes in 2010. Making it more costly to hire a new worker is not going to help put Americans back to work.
#8) The U.S. economy is facing a pension crisis of unprecedented magnitude. The truth is that the vast majority of all pension funds in the United States, both public and private, are extremely underfunded. With millions upon millions of Baby Boomers now at retirement age, there is simply no way that all of these unfunded pension obligations can be met. Robert Novy-Marx of the University of Chicago and Joshua D. Rauh of Northwestern's Kellogg School of Management recently calculated the collective unfunded pension liability for all 50 U.S. states for Forbes magazine. So what was the total that they came up with? 3.2 trillion dollars.
#9) Not only that, but the Social Security system is also a silent monster that threatens to devastate U.S. government finances. In fact, many analysts are now forecasting that the coming wave of Baby Boomers is going to bankrupt the entire Social Security system.
#10) All of these economic problems come at a time when the U.S. national debt is exploding into the stratosphere. The national debt is now over 12 trillion dollars and it is rising at a rate of about 3.8 billion dollars per day. So how much is one trillion dollars? Well, if you spent one dollar every single second of every single day, it would take you over 31,000 years to spend one trillion dollars. That is a lot of money.
The truth is that the U.S. is drowning in debt. American consumers are broke. American businesses are broke. State governments are broke. The U.S. federal government is broke. The only way that we can keep things going is to borrow increasingly larger amounts of money.
But when we do borrow even more money we make our long-term problems even worse.
The day of reckoning for the U.S. economy is fast approaching and we are headed for some extremely difficult economic times.
Are you ready?
Headed for???
The good news is that it will be a “jobless” disaster. Probably “worse than expected” too.
The Train of Insanity is going to come to crashing end. I wish I could get off of it some how.
Heh. You got that right.
And the #1 reason is a Communist, Muslim, non-citizen who has three more years left in his effort to bring America down.
He won’t need the full three years.
Zombie Alert.
When you have fiat money, which depends on an ever expanding credit bubble, a credit contraction is the end of the fuse.
Watch out, a big BOOM is coming!!!
Bump for later......C
ping
A classic answer is Warfare, or
Societal Collapse, or perhaps
Lunatic release of Bioweapon (SmallPox?)
I do not see a path that is not catastrophic...
I don’t believe the first sentence is true. Most Americans know we are in trouble. Debt is being paid down, household assets are increasing and few are speculating on a bright future by expanding or starting a business (unless they are connected to this administration and its cronies).
One possible intermediate catastrophe would be
Abandonment of Social Security, Medicare, and Medicaid
But the number of deaths in the US alone
would be an integer multiple of 10,000,000
Hospitals, Health Care, Nursing Homes, etc. would collapse
The degree of suffering will be egregious...
That is one of my fears.
Total collapse of institutions that are frauds, but with no warning to the dependent class, that is like a parasite on the taxpayers’ backs.
Very messy, very dangerous.
Yes but an overwhelming majority of 10,000,000 would be the elderly.
You will have to take care of your own then and hope that the Law doesn’t collapse next because you got to sleep sometime.
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