Free Republic

What is going to happen when the greatest economic bubble in the history of the world pops? The mainstream media never talks about that. They are much too busy covering the latest dogfights in Washington and what Justin Bieber has been up to. And most Americans seem to think that if the Dow keeps setting new all-time highs that everything must be okay. Sadly, that is not the case at all. Right now, the U.S. economy is exhibiting all of the classic symptoms of a bubble economy. You can see this when you step back and take a longer-term view...

Caterpillar North America Sales Collapse Suggests US Economy Back To 2010 Levels Tyler DurdenZero Hedge 05/20/2013 11:50 -0400 While we have wondered on numerous occasions previously if the collapse in lumber prices is the far more accurate indicator of end demand for housing (as confirmed by the recent collapse in multi-family housing starts), perhaps an even better indicator of trends in housing (and by implication the broader economy) is private sector intermediate end demand, such as Caterpillar North America sales, which unlike government data, are far less subject to political intervention, interpolation, guesswork, seasonal adjustments and otherwise, general manipulation. And...

American investment banks dominate global finance once more. That’s not necessarily good for America FOR a few tense weeks in 2008, as investment-bank executives huddled behind the imposing doors of the New York Federal Reserve, Wall Street seemed to be collapsing around them. Lehman Brothers filed for bankruptcy, Merrill Lynch collapsed into the arms of Bank of America. American International Group (AIG) and Citigroup had to be bailed out and the rot seemed to be spreading. Hank Paulson, the treasury secretary at the time, recalled in his memoir that: “Lose Morgan Stanley and Goldman Sachs would be next in line—if...

J.C. Penney Co. (JCP -3.07%) forecast a sharper-than-expected decline in fiscal first-quarter sales, citing the effect of former Chief Executive Ron Johnson's strategies to turn around the struggling department-store operator. For the quarter ended Saturday, the company said it expects to post sales of roughly $2.64 billion, a 16% drop from the prior year. Analysts polled by Thomson Reuters expect sales of $2.74 billion, or a 13% decline. Same-store sales were estimated to be down 16.6%, after falling 18.9% a year earlier.

NEW YORK (TheStreet) -- The S&P 500 fell after a spate of negative surprises in economic reports was balanced against expectations that the Federal Reserve will not be winding down its asset purchases in the near future. The latest employment numbers pointed to a slowdown in the economy with payroll processor ADP reporting that the private sector added 119,000 jobs in April vs. a downwardly-revised 131,000 in March. The number was below the consensus estimate of 150,000, according to Thomson Reuters. Similarly, the ISM Manufacturing Index dipped to 50.7 in April from 51.3 in March, falling further than the 50.9...

the last half-decade has proved far worse for black and Hispanic families than for white families when it comes to wealth — as measured by assets, like cash savings, homes and retirement accounts, minus debts, like mortgages and credit card balances — white families have far outpaced black and Hispanic ones. Before the recession, non-Hispanic white families, on average, were about four times as wealthy as nonwhite families, according to the Urban Institute’s analysis of Federal Reserve data. By 2010, whites were about six times as wealthy. The dollar value of that gap has grown, as well. By the most...

ALBERT EDWARDS: Stocks Will Crash, Hyperinflation Will Come, And Gold Will Go Above $10,000 Joe WeisenthalApril 25, 2013 This is always reassuring. SocGen strategist Albert Edwards remains an ultra-bear, and predicts everything will go to hell. In his new note he writes: We still forecast 450 S&P, sub-1% US 10y yields, and gold above $10,000 My working experience of the last 30 years has convinced me that policymakers’ efforts to manage the economic cycle have actually made things far more volatile. Their repeated interventions have, much to their surprise, blown up in their faces a few years later. The current...

The terrible economic news released today is so terrible Reuters didn't even attempt to spin it. The headline reads, "Durable Goods Report Delivers More Bad News for Economy," and the story gets right to the point: Orders for long-lasting U.S. manufactured goods recorded their biggest drop in seven months in March and a gauge of planned business spending rose modestly, adding to signs of a slowdown in factory activity. Durable goods orders slumped 5.7 percent as demand fell almost across the board, the Commerce Department said on Wednesday. That is twice the drop economists expected. Over at Hot Air, Ed...

The Economic Depression Is Deepening Economics / Great Depression IIApril 23, 2013 - 05:47 PM GMT By: Bill Bonner Gold seemed to be stabilizing at the end of last week. Commodities remained weak. Steel has fallen 31% this year. Brent crude is off 17% since early February. And copper is down 15%. Copper is the metal you need to make almost anything – houses, cars, electronics. When it goes down, it generally means the world economy is getting soft.At the start of last week, the conventional analysis of the gold sell-off was that the central banks' efforts to revive global...

The good times. Mortgage applications rose for a third week in a row, thanks in part to falling Treasury and mortgage rates. April 24 (Bloomberg) — Mortgage applications in the U.S. climbed for a third week as lower mortgage rates spurred gains in home purchasing or refinancing. The Mortgage Bankers Association’s index increased 0.2 percent in the period ended April 19 from the prior week, the Washington-based group said today. Both the group’s purchasing and refinancing measures rose by 0.3 percent. The average rate on a 30-year fixed mortgage fell to 3.65 percent from 3.67 percent in the prior week....

Gold, Stocks And Copper Set To Crash Commodities / Financial CrashApril 23, 2013 - 06:34 AM GMT By: Clive Maund Failure of gold's key support at $1500 - $1550 triggered a stunning plunge as masses of stops were triggered. We can see what happened on the 6-month chart below. The plunge was the most severe since 1980 and was accompanied by colossal record volume, which is strongly bearish. It quickly lead to gold becoming critically oversold and it bounced later in the week as cheerleaders advised their readers to buy this "opportunity of a lifetime". Is it? In this update...

United States Decaying From Within! Stocks, Gold and Dollar Outlook Stock-Markets / Financial Markets 2013April 21, 2013 - 06:58 PM GMT By: Robert M Williams No one seemed to notice or care that on June 28, 2012 the City of Stockton, California filed a petition for chapter 9 bankruptcy protection with the United States Bankruptcy Court, Eastern District of California, Sacramento, Case No. 2012-32118. On Monday, April 1, 2013, a federal judge ruled that Stockton was eligible for bankruptcy protection, over the objection of creditors who argued the city could come up with more money. U.S. Bankruptcy Judge Christopher Klein...

I can't help but think that many of the *idealist* (dopey) young people who voted for Obama must be getting the shock of their young lives. Many college students who voted for Obama were only children when 9/11 happened, it may not have been real to them but THIS is their 9/11, they will not forget it. The massive coverage that the Boston Marathon bombing has had has penetrated their little air-head experience of tweeting, social media and celebrities. Maybe they will be more grown up and sober people next time they vote.

Residential construction shot up significantly in March as homebuilders broke ground on the most multi-family homes in seven years, a report from the Commerce Department showed Tuesday. Housing starts rose 7 percent from upwardly revised levels reported in February to a seasonally adjusted annual rate of about 1.04 million units, according to the Commerce Department, almost 47 percent higher than levels reported in March 2012. Construction activity significantly outpaced projections from economists polled by Bloomberg, which put starts closer to 930,000. Starts reported in March also inched toward what economists consider a more normal level of about 1.5 million annual...

There's a real stigma associated with people who have been out of work for more than six months or those who are prone to job hopping. To find out how hiring managers view these candidates, economist Rand Ghayad conducted an experiment where he sent out 4,800 fictitious résumés for 600 job openings. Ghayad found that managers would rather hire people with no relevant job experience than someone who's been unemployed for a long time or has had several jobs in a short period of time. The resumes sent out described candidates looking work for different reasons across several industries, but...

That America created only 88,000 jobs in March, less than half the number anticipated, was jolting news, indicating the recovery that the White House has boasted about may not be at hand. But in that March jobs report, there was more disturbing news. While unemployment fell to 7.6 percent, the reason it fell is alarming. Half a million U.S. workers (495,000) disappeared from the labor force. They dropped out. They are no longer even looking for a job. Worse, this appears to be an inexorable trend. The participation rate of eligible workers in the United States has fallen to 63.3...

Caterpillar Inc. (CAT) plans to lay off more than 460 workers at a central Illinois plant that produces big mining trucks. The layoffs will shrink the work force at the Decatur plant by about 11%. The company said the reduction is needed to bring production at the plant in line with lower demand for mining equipment caused by falling prices for mined commodities and decisions by mining companies to shelve expansion projects. "While some cost-reduction measures such as temporary layoffs, shutdowns and shortened work weeks have already been implemented, more permanent measures must be taken in the near term," the...

WASHINGTON (AP) — The number of Americans seeking unemployment aid rose to a four-month high last week, although the increase partly reflects seasonal distortions around the spring holidays. The Labor Department says weekly applications increased 28,000 to a seasonally adjusted 385,000. That is the highest level since late November. The four-week average, a less volatile measure, rose to 354,250.

here were 385,000 first-time claims for unemployment insurance last week, up by 28,000 from the week before, the Employment and Training Administration says. The news follows Wednesday's report of slower-than-expected job growth in the private sector: The ADP National Employment Report estimated there were just 158,000 jobs added at businesses last month. And the word that jobless claims have touched a four-month high comes just before Friday's anxiously anticipated report from the Bureau of Labor Statistics. It will release data on the March unemployment rate and job growth in both the public and private sectors. According to Reuters, economists expect...

The Department of Labor estimates that some three million Americans with Bachelor degrees work in jobs that don’t require an education at all–janitors, barristas, bartenders and retail clerks.There are a lot of obvious reasons why junior is now living in your basement at age 25.

Entertainment Television (BET) founder Bob Johnson said Tuesday that the nation would “never tolerate white unemployment at 14 or 15 percent” and yet unemployment for the black community has been double that of white Americans for over 50 years. “This country would never tolerate white unemployment at 14 and 15 percent. No one would ever stay in office at 14 or 15 percent unemployment in this nation, but we’ve had that double unemployment for over 50 years,” Johnson said while speaking at the National Press Club about the gap between whites and blacks in America.

WASHINGTON - Barack Obama's failed job policies are facing bitter criticism from African-American leaders who say black unemployment has grown worse under his presidency. After four years of holding their tongues and remaining quiet in the face of sharply rising black unemployment and record poverty, political leaders from the Congressional Black Caucus to the NAACP have begun to open fire on the White House. Obama won 96 percent of the black vote in 2008 and about the same percentage in 2012, despite a worsening jobless crisis among African-Americans. At 14 percent for adults and 43.1 percent for 16-to-19-year-old teenagers, blacks...

In an article titled, "Use of Food Stamps Swells Even as Economy Improves," the Wall Street Journal reports that "The financial crisis is over and the recession ended in 2009. But one of the federal government's biggest social welfare programs, which expanded when the economy convulsed, isn't shrinking back alongside the recovery." The report continues, "Enrollment in the Supplemental Nutrition Assistance Program, as the modern-day food-stamp benefit is known, has soared 70% since 2008 to a record 47.8 million as of December 2012. Congressional budget analysts think participation will rise again this year and dip only slightly in coming years."

I can just imagine Jay Leno taking to the streets in order to ask the average American citizen, “What do you think about Cyprus?� More than likely, the answer would be, “I really prefer oak or maple for my flooring, I never really thought about cypress.�  Jay would reply with, “No, the country Cyprus.  The IMF, EU, and ECB, the “troika,� just put a tax on bank accounts.  Well, no.  Actually, they just stole a portion and froze the rest of the money in spite of the increased guarantees.�  The average American would then respond, “There’s a country named Cyprus? ...

We started seeing this with the Reason/Rupe poll almost two weeks ago, which Sean Trende insisted wasn’t really an outlier. Barack Obama’s approval rating started sliding in Gallup, and last week Reuters had him at 43%. Today, the Washington Post reports that Obama has lost five points in approval in their latest poll, with the most significant decline in his economic policies: The afterglow of President Obama’s reelection and inauguration appears to have vanished as increasingly negative views among Americans about his stewardship of the economy have forced his public approval rating back down to the 50 percent mark, according...

Despite the current stock market rally, legendary investor Jim Rogers say the U.S economy is poised for a major crash and is warning investors to protect themselves immediately. In a riveting interview on Fox Business, Rogers warned Americans not to trust any of the positive economic news coming from world governments. "I don't trust the data from any government, including the U.S., Rogers said. "We know that governments lie to us. Everybody's printing money, but it cannot go on. This is all artificial." Rogers, who for years has been an outspoken critic of the Feds policies of "Quantitative Easing" says...

European bulls lauding the message "the worst is behind" received another dose of reality today. Data shows German car sales plunge as Europe's auto crisis deepens. New car sales in Germany fell by more than 10 percent year-on-year in February, signaling the crisis for Europe's auto makers is deepening as recession-hit consumers curb spending. New car sales in the region dropped to a 17-year low in 2012. Speaking ahead of the industry meeting in Geneva, the sales chief of General Motors' (GM.N) Opel brand said car sales for the whole of Europe might fall by as much as 10 percent...

12 Things That Just Happened That Show The Next Wave Of The Economic Collapse Is Almost Here By Michael Snyder March 3rd, 2013 Are we running out of time? For the last several years, we have been living in a false bubble of hope that has been fueled by massive amounts of debt and bailout money. This illusion of economic stability has convinced most people that the great economic crisis of 2008 was just an "aberration" and that now things are back to normal. Unfortunately, that is not the case at all. The truth is that the financial crash of...

High gasoline prices coupled with 2% payroll tax hikes is going to take a bite out of restaurant sales this year. For some chains the slump has already started. Consider Darden Restaurants, the owner of Olive Garden, Red Lobster, LongHorn Steak House. Darden Restaurant Traffic is down an average 4.5, with Red Lobster leading the pack down 7.5%. Smaller Plates, Cheaper Items at Olive Garden At Olive Garden, Smaller, Cheaper Plates are on the way, along with new uniforms including a more contemporary black button-down shirt and black slacks. Don't worry, endless breadsticks remain. Olive Garden is also creating a...

.... Fourth-quarter earnings results came out on Wednesday and they were terrible. The bad news starts with a quarterly loss of $427 million, but it doesn’t end there. Comparable store sales—meaning stores that were open this past quarter and also open in the same quarter of the previous year—fell by a mind-boggling 32 percent. Henry Blodget says it may have been the worst quarter posted by any retailer ever. It wasn’t supposed to be this way. JCPenney made a big splash in the retail world by hiring Ron Johnson, mastermind of Apple’s retail operations, as CEO. He immediately set about...

Consumer spending in the U.S. rose in January even as incomes dropped by the most in 20 years, showing households were weathering the payroll-tax increase by socking away less money in the bank. Household purchases, which account for about 70 percent of the economy, climbed 0.2 percent after a 0.1 percent gain the prior month, a Commerce Department report showed today in Washington. The median estimate in a Bloomberg survey of 76 economists called for a 0.2 percent advance. Incomes slumped 3.6 percent, sending the saving rate down to the lowest level since November 2007. Employment gains, the rebound in...

Biden: Americans 'No Longer Worried' About Economy Daniel Halper February 25, 2013 12:39 PM In remarks today at the White House, Vice President Joe Biden said that Americans don't have the same economic worries they did when President Barack Obama came into office: "The are no longer traumatized by what was a traumatizing event, the great collapse of 2008," said Biden. "They are no longer worried, I think, about our economy being overwhelmed either by Europe writ large, the EU, or China somehow swallowing up every bit of innovation that exists in the world. They are no longer, I think,...

The Real Reason the Economy Is Broken (And Will Stay That Way) More and more economic sinkholes by Chris Martenson Tuesday, February 12, 2013, 8:54 PM We are far enough and deep enough into the most heroic monetary and fiscal efforts ever undertaken to finally ask, why aren't these measures working? Or at least we should be. Oddly, many in DC, on Wall Street, and the Federal Reserve continue to steadfastly refuse to include anything in their approaches and frameworks other than "more of the same." So we are treated to an endless parade of news items that seek to...

According to a new study by the George Soros-funded Center for Economic Policy and Research, minimum wage should be $21.72 an hour to keep up with the increase of worker productivity. Highlighting that study, The Huffington Post bemoaned President Barack Obama’s call for a higher minimum wage as a “far cry from what workers really deserve,” in a Feb. 13 blog post.

Senator Rand Paul talks to Peter Schiff on his radio show about his response to the State of the Union address, economics, and government spending. 14:00

By far the best line from this week's dueling State of the Union messages came from Florida Sen. Marco Rubio. Nice and simple, and right to the point: "Presidents in both parties -- from John F. Kennedy to Ronald Reagan -- have known that our free-enterprise economy is the source of our middle-class prosperity." That's a brilliant summary of pro-growth policies, on the supply-side and in a free-market context. Kennedy slashed tax rates and held down the budget. So did Ronald Reagan, who borrowed Kennedy's ideas: smaller government, lower tax-rate incentives and a thriving middle class, where the economic pie...

The Real State Of The Union Is Bleak James Kunstler, Kunstler.comFebruary 12, 2013, 8:56 AMThe fog of chatter about Federal Reserve money-printing shenanigans, currency wars, fiscal intransigence, exchange rates, and alphabetized rescue operations conceals the central reality of the historical moment: that all industrial economies now face epic contraction, even rip-roaring China in its absurd and spectacular bid to become the latest drive-in utopia. The so-called advanced nations of the world are all sliding toward something less than they wish to be, and the so-called developing nations will backslide further into poverty and anarchy where development will never happen. The...

<p>Stocks held near session highs Tuesday, with the Dow Jones Industrial Average hitting a fresh five-year high ahead of President Barack Obama's State of the Union address later this evening.</p> <p>With the Dow's move higher, the blue-chip average is now less than 1 percent from its all-time record close of 14,164.53 hit on October 9, 2007. The Dow is up more than 7 percent so far in 2013.</p>

Peter Schiff is a regular guest on FSN. He was way ahead of all the so-called experts, predicting the real estate crash at a time when Wall Street was still raking in the profits. We ran into him in the Bahamas at the Global Economic Summit. While others believe that country can still be saved, Peter believes that only a currency collapse, along with a complete cessation of easy credit is the only thing that can bring America to its senses. While there are certainly dangers from such an approach, it may be the only way to get Americans to...

The winter sunlight barely touches the depths of the abandoned store, where wires dangle from the ceiling, wood shavings scatter the floor, a King Lear shelf marker lies on the stairs, and a Led Zeppelin poster hangs spurned in a rack. The standalone building in Danbury, Connecticut, still bears the name of the Borders book chain that collapsed in 2011, and strewn on its cash register are fire-sale price lists for its fixtures and fittings. But nobody wanted them either. Instead its 8ft book cases stand bare and upright in the gloom, like the ruins of a bygone age. In...

(Reuters) - McDonald's Corp (MCD) said on Friday that January sales at established restaurants around the world fell 1.9 percent, a steeper decline than expected as fast-food chains fight for diners. McDonald's warned last month that same-restaurant sales would be down. Analysts polled by Consensus Metrix had expected a decline of 1.1 percent. Shares of McDonald's, which had fallen earlier in the week, slipped 3 cents to $94.60 in premarket trading. McDonald's expected sales and profit growth to be under pressure in the near term, as diners spend cautiously due to lackluster economic growth in most major markets. At the...

A comprehensive new Harvard University report on Americans under 30, the so-called Millennials, shows that the economy is having a crushing impact, with just 62 percent working, and of those, half are toiling at part-time jobs. The report, released by Harvard's Institute of Politics, paints a depressing economic portrait of young Americans, many of whom are stuck with huge college tuition bills and little chance of finding a high-paying job...... Contrary to common media wisdom, most younger Americans did not vote in the last election. Of the 46 million Millennials, just half voted. "Although turnout was higher than it was...

A comprehensive new Harvard University report on Americans under 30, the so-called Millennials, shows that the economy is having a crushing impact, with just 62 percent working, and of those, half are toiling at part-time jobs. The report, released by Harvard's Institute of Politics, paints a depressing economic portrait of young Americans, many of whom are stuck with huge college tuition bills and little chance of finding a high-paying job. But over half, or 59 percent of those aged 18-29, have gone to college and The report reveals that time in college is a better sign of social status than...

JCPenney CEO Ron Johnson is getting ready to break more hearts at headquarters — a few hundred more. In what some Penney insiders are calling the “St. Valentine’s Day Massacre,” the former Apple exec plans this month to fire at least 10 percent of the remaining 3,000 employees at the retailer’s home offices in Plano, Texas, sources told The Post. While the bloodbath was originally targeted for last month, sources said Johnson opted to delay it until after the flailing company’s fiscal year ended last week. “They wanted to throw the severance costs into this year because last year was...

Following the governmemt's Employment Situation Summary yesterday, two words were noticeably absent at the Associated Press (here, here, and here), Bloomberg, Reuters, CNBC, and the New York Times: "seasonally adjusted."

President Obama blamed the recent contraction of the U.S. economy on “bad decisions in Washington” in his weekly address. The national economy shrank by 0.1 percent in the fourth quarter of 2012, according to figures released this week by the Commerce Department. The contraction was an unexpected reversal of months of modest economic growth since the end of the recession in mid-2009. Obama said in his address that the dip was the fault of “bad decisions” being made in Washington. “We began this year with economists and business leaders saying that we are poised to grow in 2013,” he said....

-Snip- And while successful retailers in 2012 may add stores this year, those that have performed very poorly may have to cut locations during 2013 to improve margins or reverse losses. For many retailers, the sales situation is so bad that it is not a question of whether they will cut stores, but when and how many. -Snip-

The number of Americans not in the labor force grew by 169,000 in January, according to the Bureau of Labor Statistics’ latest jobs report. BLS labels people who are unemployed and no longer looking for work as “not in the labor force,” including people who have retired on schedule, taken early retirement, or simply given up looking for work. There were 89 million of them last month.

The employment numbers are out today. The headline numbers are not good news for housing: U3 unemployment ROSE to 7.9% and U6 unemployment and partial employment remained the same at 14.4%. The good news? Labor force participation didn’t get any worse! It remained the same at 63.6%. The bad news? We are now like Japan in terms of labor force participation after we leveled off under President Clinton and began declining. The civilian employment to population ratio also remained the same as a measly 58.6%. But also like Japan, our employment to population ratio is generally declining. Like the movie...

NAACP President and CEO Benjamin Jealous is known for making headlines, and he’s at it again. In an interview with David Gregory on Meet The Press, Jealous said that African Americans are doing worse under President Obama than under President Bush. “When you look at joblessness in this country, the country’s back to pretty much where it was when this president started,” he said. “White people in this country are doing a bit better. Black people are doing far worse.” Now that election season is over, it’s clear that the honeymoon between the Obama administration and the NAACP is over....