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Tuesday, May 12, 2009

America's Stormy Weather

The future of America will never look like the past. What America is going through now will give us a peak into the future. The past life will be referred to as the “Good Old Days”. “You remember when…”, will be barstool talk. The average American spending money on $2000 or more week long family vacations to child-friendly locations will only be experienced by only a fraction of those who can afford them. The others will only be able to share such memories from their dog-eared pages of the bygone family vacation scrapbook.

A new American paradigm is rapidly evolving. It is just as I have been describing it in my past postings. I am not the only one writing about it, but, unfortunately, many are not planning for it. My neighbor, at the age of 65, has been told by his wife that she wants to put an addition on their house, even though she has saved very little for her retirement. In a year or so, it will be only the two of them in their comfortable home. So why a new addition only after fully gutting the entire home around 10 years ago and a new double car garage just 5 years ago? The reason is his wife cannot change her consumerism ways of thinking.
The new question America will be facing in only a few months will be this--- what will be the new un/under-employment equilibrium level for the nation? I, as others, feel before we find that spot the percentage will reach, at least, 20% nationwide. Michigan and California are nearly there now!

Americans trained in auto assembly, or retail, or construction work, or finance and business are finding themselves asking the federal government for relief in the form of unemployment compensation.

The stock market’s casino winnings are separate from the “real” economy. Those winnings, or losses, are only for those who can afford them. More and more Americans no longer can take the risk with their evaporating incomes. The only risky decision they might make could be either to take the family out for dinner two nights in a given week, or, instead, to just leave it at one.

Americans are feeling the pinch. As more people are finding themselves in need of support from their Uncle Sam in Washington, they could be faced with tough decisions, such as to take that lesser paying job, now, instead of waiting and hoping for that dream job to come along tomorrow; or, to take that part-time job, instead of waiting for a full-time job to drop in their lap. They know they have to save more money, and spend less. Americans realize that they need to increase their savings and pay down debts. This is now where their consumer dollars are being channeled. This is the new economy.
This negatively impacts the GDP of the nation. Less consuming means fewer customers. Fewer customers lead to retail, service, and manufacturing job cuts, wage and benefit reductions, and the trimming of weekly work hours. This all leads to decreased industrial production and capacity. Bankruptcies and foreclosures follow. There will likely be 8 million foreclosures during this 2009 year.

As Americans watch their families and friends and co-workers suffering, they also angrily observe those inside Wall Street demand from the U.S. government, and with Obama’s Blessing, the blatant transfer of the nation’s wealth right into the Banksta’s balance sheets. The more assistance the top tier financial Wall Street banks need and want from the Treasury and Federal Reserve, they get. The Stress Test was really the Scam Test.

Since 2007, we have watched billions and trillions of dollars pledged, promised and issued to the Bankstas. They are so full of liquidity they continue to plan to issue more bonuses and fatter expense account spending limits. But, the truth is there still remains $3.2 trillion in non-performing mortgage loans sitting on their books, being ignored, ready to tear open their balance sheets. The coming foreclosures will blow down their house of card banking fa├žades. Timmy Geithner will be left holding the empty Private-Public Investment Program Goodie Bag. President Obama will have trashed the nation’s balance sheet when he begins to wipe the Banksta’s Swine Flu Flux from his face and proclaims it is time to nationalize the banks and take them into receivership. I sure hope the Bankstas have not transferred the government’s gifts into off-shore accounts.

The nation’s Treasury has a zero balance sheet. There is now a diminishing revenue stream, as TimmyG and Bernie-Nakie promise $11 trillion to the financial economic recovery plan. The nation has now realized that there are fewer products being purchased, therefore fewer sales receipts coming in. There are fewer capital gains, and payroll taxes finding there way into the Treasury, as well as state and local governments. Our GDP is shrinking. And China is now waking up to the fact that they cannot continue to buy zero interest Treasury bonds.

China might actually find themselves in the same economic predicament the United States is now in. China was able to expand as a result of Americans buying cheap stuff from them. As a result of trillions of US dollars entering their central bank, a massive economic surplus was formed. That surplus brought wealth to the Chinese middle class. Jobs were created, buildings were constructed, condominiums sprouted up, and factories were built. Services came along with this growth. But now, this boom is slowing. Jobs by the tens of millions are disappearing. Unemployment is rising. The wealth boom is coming to an end. The cities are filled with major land development projects that might not be completed, but the Chinese central bank has made a commitment to further fueling development.

Who will buy their manufactured over-capacity? The U.S. consumer is dried up, even at deflated prices. The Chinese may actually end up with a huge over-capacity, and a slowing GDP because of it. The Chinese might find their middle class unable to keep up with over-inflated housing prices, therefore, going into foreclosure, and bankruptcy. Credit card users might go into default. The Central Chinese government might find that their massive central banking injections into their development expansion was a bad idea. 20-30 million, and growing, Chinese finding themselves unemployed and in need of food, medicine, housing and health care could easily overwhelm the nation and shift them into crisis-mode.

As the world’s economic engines grinds to a halt, President Obama, confused and bewildered, and realizing that the citizens of this nation have seen their wages eroded while the bankstas are doing pretty nicely-thank you very much!—have stolen the country’s treasure. And then, there are the two wars draining the budget, as well. Two wars with little to show for all the blood and cost invested in them.

President Obama knows what he is doing. He knows he is shifting wealth away from the “real” economy into a “non-functioning” fictional economy. Geithner is just a zombie himself. He was taken over by Goldman Sachs vampires a long time ago. To believe that by stuffing the banker’s pockets now, and that come December or next July or November the economy will percolate up and the beaten down American will begin to spend and spend further, re-inflating the dead housing market, or auto industry, or entertainment industry, instead of trying to replenish their deflated retirement nest-egg stolen from them, must have been waterboarded too many times. It just won’t happen!!

To answer my question of what will be the new equilibrium level of un/underemployment that will be part of this New American Paradigm, I might answer by saying how about 10%? Where will the money come from to rebuild a nation’s industry and work force that had been shipped overseas and outsourced? A new American paradigm is heading our way, and it looks more like stormy weather than a sunny day.

thanks for reading, jerry


SPECTRE of Deflation said...

Ya, but I bet you didn't know Obamanomics cut taxes for 95% of American Assholes per this YouTube video. :>)!

carlandjerry said...

SPECTRE, thanks for reading.

Yes, I am aware of the tax cut. Most people will be receiving in it in small, incremental bits forcing them to pay little attention to the extra cash in their checks in order for them to piss it away on candy bars, soda, chips, etc. President Obama did not want them to use it to pay down some bills or catch up on their house payments, or put it into an IRA.

Yet the banks get their Treasury bonuses in huge billion dollar lumps so they can add more to the bankster's bonuses and travel allowances.

SPECTRE of Deflation said...

You have to watch the video. He literally calls Americans Assholes. Even his slip of the tongue on the video won't stop his high approval rating. I figure it's the Soda Tax that will upset the sheeple. Just watch the video for a chuckle.

Clifton said...

It surprises me that Obama gets so much blame for the economy after only 110 days in office. Bush got a free ride on 9/11 despite warnings and 9 mos. in office. Even if Obama had a magic economic fix, vested interests would likely obstruct its implementation and prevent him from taking a direct path.

jerry said...


Bush was heavily criticized and even forced Americans to go out and protest his neo-fascist policies, and the wrath of outrage even continues to this day. Yes, he did leave President Obama with a mess--a huge mess, but President Obama campaigned on Change That We Can Believe In, but so far, the most expensive changes that we have seen is a shift of wealth from the working American onto the balance sheets and into the pockets of the worst culprits who brought down the economy.

President Obama has had the opportunity to pick members of his circle who would have never been part of the banking crime syndicate, but he chose to bring them on board and give them the power to actually transfer the wealth of the treasury into their hands.

President Roosevelt stood up to the banking cartel and became the lender of first resort in order to stimulate the economy and bring jobs to the unemployed. All that was done in the first 100 days.

We have passed 100 days but, for the most part, President Obama has continued along the same path of economic recovery that Bush had begun to take, and, no doubt, McCain would have proceeded upon.

Magical fixes are not being shown to Mr. Obama. Practical, sensible, applicable, and available fixes have been presented to him time and time again without implementation. One has to ask why? I think we all know why. It is because the "too-big-to-fail" financial institutions have told him, and many Congressional members, as well, that actions that would benefit a true economic recovery are unacceptable.

They have said that it is better to recapitalize the zombie and insolvent top financial banks than to help the real economy raise all boat. Receivership is the light which enters the coffins of the vampire, predatory banksters sucking the life out of the real economy.

SPECTRE of Deflation said...

Let me explain this again. They can give a rat's ass about you or I. Both Partys are legal organized crime syndicates who demand tribute from those they protect. $14 Trillion Dollars later tells us they are protecting the banksters. The sheeple, that's us in their minds, get bread and circus while they steal the very last nickel of what was the American Treasury. Meanwhile we discuss Obama while Rome burns. LOL! I must laugh or I would cry over what has become of our Republic?

Obama has it right by half. We aren't assholes so much as dumbasses!

SPECTRE of Deflation said...

This video could be from the 1930's in Germany. The Obama Youth Corp has arrived. Are you ready? Scary shit!!!!!!

carlandjerry said...

SPECTRE, I agree that both political parties are infiltrated with representatives who really don't care about anything but themselves and their own treasure chests. But, once the economy falls even more into the dumper, their electable positions will be on the skids as voters kick their butts out of office. Maybe-maybe candidates will rise up and begin representing the people who elect them into offices.

From chaos comes order.

Anonymous said...

How could 95% of Americans get tax cuts when 95% of Americans DO NOT pay income tax??? I said thanks to the $1200.00 bucks Bush sent back to me at the same time saying it would NOT make a difference! At least the lump sum paid down some of MY debt. I wonder how many couples were both are working will get a smaller tax refund or owe next year and wonder why.

Until the people in this country go back to taking care of themselves and not depend on someone else the FEDS will keep growing and stealing from us all!

Clifton, Obama's budget will triple the debt, how do you think that is effecting the economy? That makes it his in my book. And Bush inherited a recession and 9-11 happened and the majority of his terms we where on the up swing.

The only way I see this turning around fast is if GOVERNMENT would do what we 'THE PEOPLE' have to do when times are tight. We TRIM our budgets by cutting un-neccessary things. If they would listen to those that went to the 'Tea Parties' this would be just a bump in the road.

Sorry Carl and Jerry, but I am just not a doom an gloom type of person, I don't think it is as bad as the talking heads even try to make it out to be let alone how bad you guys think it is.

carlandjerry said...

Anonymous, thanks for your opinion, although I totally disagree with nearly everything you said. I appreciate you taking the time to share your thoughts and opinions, as well as taking the time to read the posting. I guess we will know how it all unfolds in due time. Someone has to be optimistic. It may as well be you!


PAUL said...

Magical fixes are not being shown to Mr. Obama. Practical, sensible, applicable, and available fixes have been presented to him time and time again without implementation.
and what are these practical etc. fixes? and what kind of help is he getting from congress. TERM LIMITS are the only answer. instead of worrying about getting reelected, they could do what is necessary

carlandjerry said...

Paul, thanks for leaving your comment. I appreciate that you took the time to read and voice your opinion.

You are so right! Obama has been told time and time again, by smarter economists than those he has currently advising him, what the fixes need to be. Although, I must say that public sector capital injections are required especially during a time when the private sector is shrinking and broke. Nevertheless, term limits is the only answer to the Congressional corruption and palm greasing that seems to go on. Also, public funding for Congressional races is needed to allow the underdogs to possibly beat incumbents.


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