Seasons greetings! US debt-to-GDP passes 100%

Watershed.

Zero Hedge (h/t Weasel Zippers)  – With precisely one year left for the world and all of its inhabitants, at least according to the Mayans, not to mention on the day of the Winter Solstice, it is only fitting that US debt, net of all settlements for all already completed bond auctions, is now at precisely $15,182,756,264,288.80.

Why is this relevant? Because the latest annualized US GDP, according to the BEA, was $15,180,900,000.00. Which means that, as of today, total US debt to GDP is 100.012%. Congratulations America: you are now in the triple digit “debt to GDP” club!

I. Total debt as of December 20: $15,131,979,264,288,80 (source)

II. Net cash settlement of all completed auctions: $50,777,000,000 (source)

III. Total GDP: $15,180,900,000,000 (source)

=> Total Debt/GDP= $15,182,756,264,288.80/$15,180,900,000,000 = 100.012%

Keep reading…

Video: Land of the freebies, home of the enslaved

America is America no more. ‘The land of the free and home of the brave’ has become ‘the land of the free-loader and the home of the slave to government.’

GovtGoneWildSeminars -  Watch this SHOCK video about our government’s “cradle to the grave” entitlement society!

British MEP Daniel Hannan: As Rome fell, so will Europe

Western civilization is committing suicide.

Introducing the scariest clock in the world – The World Debt Clock

Gloom and doom just got gloomier and doomier.

Yet, it gets much worse…

“Should one add the NPV of all “welfare state” obligations (pensions, retirement, healthcare), the number will be well over quarter of a quadrillion dollars.”

Zero Hedge (h/t Weasel Zippers) – By now everyone has had a chance to play with the US debt clock. But what about its global cousin? Courtesy of The Economist, we now have a convenient way to track the hundreds of millions in dollars added each and every hour by the global governments who see to spur global deleveraging by, you guessed it, adding more debt.

Yes, in the process the world’s sovereigns are transferring default risk away from global corporations to sovereigns, but few in the #OWS crowd appear to have yet figured out this rather disturbing and very insidious usurpation of sovereignty by the global corporatocracy, so said risk and leverage transfer will continue until such time as any and all paper backed by these insolvent corporate shells (f/k/a countries) is completely worthless.

Regardless, one should not forget that like in the sandalone case, the “debt clock” below only tracks on balance sheet debt. Should one add the NPV of all “welfare state” obligations (pensions, retirement, healthcare), the number will be well over quarter of a quadrillion dollars. Have fun funding that, never mind paying it off. . .

Play with the global debt clock here.

Video: Why the global economy will collapse

Decades of idiotic policy explained in five simple minutes.

Jim Sinclair: Dollar doomed, own gold, be “your own central bank.”

We are in a heap of trouble. Gold has only just begun its rise. Jim Sinclair says, be “your own central bank.”

GoldMoneyNews – James Turk, Director of The GoldMoney Foundation, talks to Jim Sinclair, host of
http://www.jsmineset.com/
, about his successful gold price predictions, US debt problems, how to ride the trend and the second phase of the gold bull. It’s a gear change from arithmetic to exponential growth as public perceptions about the safety of the US dollar changes. The debt ceiling debate is a wake up call for people all over the world. The video was recorded on August 5 2011 at the GATA conference in London.

S&P downgrades Omerika from AAA to AA+ with “negative outlook”

UPDATED with Peter Schiff’s take at bottom (video).

Barack Obama is indeed “historical”.

In two and a half short years, the ‘smartest man to ever be president’ has “transformed” America from a AAA nation to a AA, with a “negative outlook” to boot.

The Democrat apparatchiks in the state-run media will try to blame the Tea Party for this, but it has been the Tea Party who has been predicting this inevitability since the movement began.

Furthermore, it is the Tea Party people who have been the only ones who have put any serious plans for dealing with the debt crisis on the table. They have offered the ‘Ryan Plan,’ ‘Cut, Cap, and Balance,’ and the ‘Mack Penny Plan‘.

The Democrats have offered only the Obama-Reid-Pelosi-Lenin-Alinsky-Cloward and Piven ‘Implode America Plan’.

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(via Legalinsurrection) S&P has dropped the U.S. credit rating from AAA to AA+:

The United States’ credit rating was cut for the first time when Standard and  Poor’s lowered it from triple-A to AA+, citing the country’s looming deficit  burden and weak policy-making process.

Standard and Poor’s on Friday revised the nation’s rating downwards to a AA+ with a negative outlook, despite a push back from the White House, which said  the rating agency’s analysis of the US economy was deeply flawed.

It was the first time the US was downgraded since it first received a  triple-A rating from Moody’s in 1917; it has held the S&P rating since  1941.

S&P further warned:

The outlook on the long-term rating is negative. We could lower the long-term rating to ‘AA’ within the next two years if we see that less reduction in spending than agreed to, higher interest rates, or new fiscal pressures during the period result in a higher general government debt trajectory than we currently assume in our base case.

So, S&P must be a bunch of evil Republican-donating hacks, right? Nope. The top dogs contribute almost exclusively to the Democrat party.

Hotair.com has posted loads of updates on the story. Here are some of them:

Update: A grumpy White House points to S&P’s math error and calls it “amateur hour.”

Update: Zero Hedge has the text of S&P’s statement. The debt-ceiling deal wasn’t good enough:

Update: A footnote to a bleak day via Dan McLaughlin: Rick Perry gets another point of contrast for his campaign.

Update: Is this an economic mega-quake or a slight tremor? There’s no way to know since we’ve never been here before, says WaPo’s Dyan Matthews, but here are the arguments for both scenarios.

Update: The GOP was planning to push their message for a balanced-budget amendment during the August recess. The downgrade will help that effort, but I wonder after this whether we’ll have an August recess after all. Is Congress really going to sit back for another four weeks while the economy tries to cope with this news?

Update: Fannie Mae and Freddie Mac will probably be downgraded too. So much for any near-term housing market recovery.

Update: The Treasury Department is indignant: “A judgment flawed by a $2-trillion error speaks for itself.”

Update:Warren Buffett, whose own company was downgraded by S&P, thinks it’s a big nothingburger:

Buffett to my colleague Liz Claman: Did the US deserve this? “Buffett: “NO.” Are you worried about the markets Monday? “NO.”

Gateway Pundit – Michele Bachmann reacted to the news tonight that S&P downgraded the US credit rating. Bachmann was on with Greta Van Susteren.

“This president has destroyed the credit rating of the United States through failed economic policies and his inability to control government spending… President Obama is destroying the foundation’s of our economy one beam at a time. I call on the president to seek the immediate resignation of Treasury Secretary Tim Geithner and to submit a plan with his list of cuts to balance the budget this year, turn the economy around and put our people back to work.”

REPORT: China says here comes QE3!

Bloomberg  (h/t Weasel Zippers)  — The U.S. Federal Reserve will extend its program to purchase the nation’s debts and stabilize long- term interest rates after Standard & Poor’s downgraded its credit rating, according to an adviser to China’s central bank.

The Fed will roll out quantitative easing 3, a tactic to purchase treasuries, Li Daokui, an adviser to the People’s Bank of China, wrote in his microblog weibo.com. Institutional investors will be forced to sell long-term U.S. debt, which may cause financial turbulence, he wrote.

S&P lowered the U.S. rating one level to AA+ from AAA for the first time yesterday while keeping the outlook at “negative,” citing the nation’s political process and criticizing lawmakers for failing to cut spending enough to reduce record budget deficits. The rating may be cut to AA within two years if spending reductions are lower than agreed to, said the New York-based rating firm.

The U.S. must address its “structural debt problems” and ensure the safety of China’s dollar assets, the state-run Xinhua News Agency said in a commentary today. China is the biggest holder of U.S. debts.

Here’s Peter Schiff’s take on the news.

Video: The weight of money

This clever video was one of the entries in Powerline’s recent contest for the best depiction of the size of America’s obscene amount of debt.

I’ve posted a few of them already. This is another good one, looking at the debt in terms of weight. When we hear of the “heavy burden,” debt puts on our children and grandchildren, that’s an understatement.

(h/t Rightscoop)

New low: Whopping 17% of Likely U.S. Voters say country is heading in right direction

Stop and ask for directions? Never!

Rasmussen (h/t Weasel Zippers) — Just 17% of Likely U.S. Voters now say the country is heading in the right direction, according to a new Rasmussen Reports national telephone survey taken the week ending Sunday, July 24. That finding is the lowest measured since January 11, 2009.

From August 2007 to early January 2009, confidence in the nation’s current course ranged from a low of 10% to a high of 24%. When President Obama assumed office, optimism rose to 27% and climbed to the low to mid 30s until May 2009. That figure has steadily declined since.

Seventy-five percent (75%) of voters say the country is heading down the wrong track, the highest finding since early January 2009. Since that time, voter pessimism had ranged from 57% to 72%.

Jimmy Obama and the malaise redux

This is very good. It demonstrates many things, among them, how depressed and depressing Liberals are, and that their playbook never changes.

IngrahamAngle - The man who was supposed to bring hope and change competes for the title of worst modern president.

via Hotairpundit

Obama economy actually LOST 26,000 jobs in June

The horrible jobs report was even worse than reported.

The New York Post, via JWF and GWP:

The Labor Department officially announced that only 18,000 jobs were created during the month of June compared to May’s levels. That’s considerably below the 157,000 jobs that payroll-processing firm ADP said on Thursday were added by companies in the private sector.

Our economy is said to need at least 150,000 jobs a month just to keep up with people entering the workforce. So even job growth of 150,000 isn’t good enough.

Worse, not only are newcomers trying to find positions, but there are also 7.084 million fewer jobs in this economy than there were at the 2008 peak. So people who’d like to get their careers started are competing against millions of experienced job seekers looking to just get back into the game.

Now for the really bad news: that 18,000 gain announced by the government yesterday isn’t real.

For one thing, the number of jobs increased in June only because the Labor Department simultaneously revised downward the number of jobs that existed in this country during May. It’s like moving the fences at Citi Field so the Mets players can hit more home runs. It might make Jose Reyes feel better, but it doesn’t actually make him more powerful.

Without the fence-moving operation in the May employment report, the June number — yesterday’s number — would have shown a decline of 26,000 jobs.

Geithner on economy: “it’s going to feel harder than anything they’ve experienced in their lifetime now, for a long time to come”

Hope and change is now officially gloom and doom.

Tax cheat and Treasury Secretary Timothy “Turbo Tax” Geithner, says the Obama Administration has done a fantastic job at managing the economy, but that despite their heroic efforts many Americans will know nothing but the Obama depression for the rest of their miserable lives.

The White House says, however, that this won’t stop Americans from voting for The One again in 2012, because the economy “won’t be an issue”.

(AP) — Treasury Secretary Timothy Geithner (GYT’-nur) says many Americans will face hard times for a long time to come.

He says President Barack Obama rescued the United States from a second Great Depression and will keep working to strengthen the economy. But Geithner says will be some time before many people feel like the country is recovering.

Geithner tells NBC’s “Meet the Press” that it’s a very tough economy. He says that for a lot of people “it’s going to feel very hard, harder than anything they’ve experienced in their lifetime now, for a long time to come.”

CIA: U.S. current account balance ranks dead last out of 191 countries

Well this can’t be a good thing.

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WND - The United States ranks last among all nations in the world when it comes to its current account balance, astronomically lower than every other economy, the CIA reports.

According to the most recent figures in the CIA World Factbook, America sits at the bottom of 191 nations, with a listed account balance of an astonishing negative $561 billion.

The next closest nation to the U.S. is Spain, and though it’s ranked at No. 190, its account balance is negative $66 billion, far less than the American figure.

The CIA defines current account balance as “a country’s net trade in goods and services, plus net earnings from rents, interest, profits, and dividends, and net transfer payments (such as pension funds and worker remittances) to and from the rest of the world during the period specified.”

Topping the list on the positive side is China, with an account balance of $272 billion. It’s followed by Japan, Germany, Russia and Norway.

Rounding out the top ten are Saudi Arabia, Switzerland, the Netherlands, Singapore and Taiwan.

Besides the U.S. and Spain at the bottom of the list, the remainder of the worst ten are Italy, France, Brazil, United Kingdom, Canada, Turkey, Australia and India.

Greece, which has been making headlines for its financial problems for months and has seen economic-related violence escalate in recent days, is ranked at 180 with an account balance of negative $17 billion.

The U.S. is not at the bottom of every CIA list. In fact, it’s ranked No. 1 in the world when it comes to external debt.

With a whopping $13.98 trillion as of June 2010, the U.S. holds the dubious distinction of top debtor, just ahead of the European Union, whose debt is listed at $13.72 trillion.

The top 20 countries with the highest debt can be seen in this CIA chart:

The U.S. ranks second only to the European Union when it comes to gross domestic product, or GDP. The U.S. GDP is estimated at $14.66 trillion for 2010.

When it comes to unemployment, the U.S. is about in the middle of the pack, ranking 106 out of 200, with a jobless rate of 9.7 percent.

The Central Intelligence Agency notes on its website that it’s “an independent U.S. government agency responsible for providing national security intelligence to senior U.S. policymakers.”

Half of last month’s new jobs came from McDonalds

The new economic numbers and America’s 9.1% unemployment are even worse than they look on the surface.

Half the piddling 54,000 jobs that were created were burger flippers and fry friers at McDonalds.

McDonalds is a great corporation, but a strong economy, and especially that of a superpower can’t be based on happy meals.

Weekly Standard (h/t Weasel Zippers) – According to the unemployment data released this morning, the economy added only 54,000 jobs, pushing the unemployment rate up to 9.1 percent.

However, this report from MarketWatch suggests data is much worse than that:McDonald’s ran a big hiring day on April 19 — after the Labor Department’s April survey for the payrolls report was conducted — in which 62,000 jobs were added.

That’s not a net number, of course, and seasonal adjustment will reduce the Hamburglar impact on payrolls. (In simpler terms — restaurants always staff up for the summer; the Labor Department makes allowance for this effect.) Morgan Stanley estimates McDonald’s hiring will boost the overall number by 25,000 to 30,000.

The Labor Department won’t detail an exact McDonald’s figure — they won’t identify any company they survey — but there will be data in the report to give a rough estimate  Keep reading…

Relatedly, here’s the scary-ass chart of the week. Notice most recoveries resemble a ‘V’ or a ‘U’ shape. But we are experiencing a spaghetti recovery.

Business Insider – The classic Calculated Risk jobs chart looks horrible after today’s big whiff. The “recovery” has clearly flattened out.

Niall Ferguson: Eurozone is a government killing machine

My second favorite pessimist and happy warrior, Niall Ferguson, was on Bloomberg discussing the many conundrums facing the European Union.

Professor Ferguson says the crisis is worse than anyone wants to admit, and that Europe refuses to deal with reality. He sees a distinct possibility of a “2008-sized event, this time in Europe.”

Business Insider – Niall Ferguson spoke to Bloomberg Television this morning about the deteriorating situation in the eurozone. He points to the current infighting between the ECB’s leadership, and the rest of the eurozone, as creating an environment where the region’s problems can’t get solved.

• 0:50 View confirmed that the eurozone is a government killing machine, that the bailouts and austerity measures are forcing governments out.

• 1:50 One precedent in the 19th century – Latin monetary union, ended by Italian deficits.

• 2:20 Political opportunists will take hold, more True Finn type parties in north, in the periphery, more parties who want to leave. Leaving the eurozone is going to start surfacing as a politically credible idea, and it’s the most dangerous one.

• 3:30 It’s important the IMF has a heavy hitting European leader, but there’s no reason to think this will create a solution to the crisis. Jean-Claude Trichet at the ECB is making it tough to get a restructuring through. Europeans can’t agree on how to sort out Greece. If the ECB is against this, it doesn’t matter what the IMF does. Stakes are much higher than politicians think. The possibility of getting an orderly solution is getting lower and lower.

• 7:00 The problems in Greece are not that big, but what we’re dealing with is a collapse in political will.

Are you a fan of Niall Ferguson’s gloomy historical realism? Here’s some more:

• Niall Ferguson’s decline of the west continued
• Niall Ferguson schools his blame-the-west for everything foes
• Niall Ferguson discusses the West’s perilous days ahead
• Niall Ferguson: Middle East democracies unlikely, $200 oil more likely
• Historian Niall Ferguson slams Obama, mystifies Mika Brzezinski

Heritage: National debt set to skyrocket

We may have killed Osama bin Laden, but the scourge of scourges, America’s ballooning debt, remains on the loose. Worse still, no one in the Federal government is even attempting to slay Osama bin Debt.

Heritage Foundation - In the past, wars and the Great Depression contributed to rapid but temporary increases in the national debt. Over the next few decades, runaway spending on Medicare, Medicaid, and Social Security will drive the debt to unsustainable levels.

Federal tax code rules, regulations, and IRS rulings – 72,536 pages and growing…

Talk about your regulatory kudzu, according to tax publisher CCH, there are now 72,536 pages of federal tax code rules, regulations, and IRS rulings.

If only we could click our heals and go back to 1913… Better yet, back to 1894 when the Supreme Court declared the Income Tax of 1894 unconstitutional in Pollock v. Farmers’ Loan & Trust Co..

from Cato@Liberty

Niall Ferguson’s decline of the west continued

Niall Ferguson has a new presentation on the decline of the West. Fifty plus charts that put the ‘oo’ in gloom and doom. Like this one:

(Via businessinsider.com)

The saddest part of all is that the downfall of the West was completely self-inflicted. It should be called, ‘the suicide of the West’. Liberalism + Keynesian economics = cultural and fiscal disaster.

Like Niall Ferguson’s gloomy historical realism? Here’s some more:

• Niall Ferguson schools his blame-the-west for everything foes
• Niall Ferguson discusses the West’s perilous days ahead
• Niall Ferguson: Middle East democracies unlikely, $200 oil more likely
• Historian Niall Ferguson slams Obama, mystifies Mika Brzezinski

New normal: 40% of children in U.S. now born to unwed mothers

When you are brought up to believe that Uncle Sam takes care of everything, dads become superfluous. How can we balance a Federal budget when we can’t even balance a family? Furthermore, when you see how men are constantly portrayed in TV commercials and sitcoms as absolute clods and dopes, why would any woman want one around anyway?

Despite a dip in teen births, over the last five decades, the number of unwed mothers in the U.S. has actually soared, reports the Heritage Foundation.

Gee, what changed in the 1960s? Well, LBJ’s “Great Society” and the welfare state was implemented, the universities became bastions of Liberalism, radical feminism began its ascent, and Liberals in Hollywood and the media launched their war on G-d, religion, and American values.

Whereas in the 1960s fewer than 10 percent of all babies were born outside of marriage, today that number is over 40 percent. And for some groups it has already reached 50 percent or far surpassed it. For example, nearly half of Hispanic children and nearly three-fourths of African-American children are born to single mothers annually.

Good grief. We are so screwed.

Way to go Liberals. Pat yourselves on the back. Mission accomplished. And no, as the study shows, birth control is not the answer.

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Heritage - On Tuesday, the U.S. Center for Disease Control and Prevention announced that U.S. teen birth rates dropped to their lowest rate in decades. According to the report, the number of teenage births has declined by nearly 40 percent in the last 20 years.

Of course, this is good news, especially considering the myriadnegative implications for children born to teen moms, such as lower school achievement and an increased risk of becoming teen parents themselves.

But there’s a flipside to this positive news. Despite the dip in teen births, over the last five decades, the number of unwed mothers in the U.S. has actually soared. Whereas in the 1960s fewer than 10 percent of all babies were born outside of marriage, today that number is over 40 percent. And for some groups it has already reached 50 percent or far surpassed it. For example, nearly half of Hispanic children and nearly three-fourths of African-American children are born to single mothers annually.

This is because fewer and fewer marriages are taking place in the United States, a trend that is especially common in low-income communities, where many of these single mothers reside. Yet it’s not that these women don’t value or desire marriage; rather, the perpetuation of single-motherhood has fueled a cycle in which unwed birth has become the norm. Instead of marriage and childbearing being a sequential process, the two have become separate, unassociated practices. And far too often, marriage never becomes part of the story.

The consequences are dire. Perhaps gravest is the significantly enhanced risk of poverty these women and children face. A child born to a single mom is more than five times as likely to live in poverty as a child born to married parents.That’s why it’s no coincidence that along with the growing rate of unwed childbearing, the U.S. has also experienced drastic increases in welfare costs over the decades.

Yet the outcomes of being raised without a father are not just economic. Children raised without fathers are also at increased risk of developing emotional and behavioral problems, participating in risky and delinquent behavior, dropping out of high school, and being abused. Furthermore, being raised outside of an intact family increases the likelihood of sexual activity for teens, thereby increasing their chances of becoming a single parent and thus perpetuating the cycle of poverty and dependence.

Unfortunately, most of the talk about lowering out-of-wedlock birth centers on increasing access to birth control. But research reveals that lack of available birth control is not the problem. Researchers find that many single, low-income women are having babies because they desire children. Although marriage has broken down, bearing children is still highly valued. (more >>)

Most illegal immigrant families collect welfare

Collecting the welfare Americans won’t collect?

We are sooo doomed.

Judicial Watch – Surprise, surprise; Census Bureau data reveals that most U.S. families headed by illegal immigrants use taxpayer-funded welfare programs on behalf of their American-born anchor babies.

Even before the recession, immigrant households with children used welfare programs at consistently higher rates than natives, according to the extensive census data collected and analyzed by a nonpartisan Washington D.C. group dedicated to researching legal and illegal immigration in the U.S. The results, published this month in a lengthy report, are hardly surprising.

Basically, the majority of households across the country benefitting from publicly-funded welfare programs are headed by immigrants, both legal and illegal. States where immigrant households with children have the highest welfare use rates are Arizona (62%), Texas, California and New York with 61% each and Pennsylvania (59%).

The study focused on eight major welfare programs that cost the government $517 billion the year they were examined. They include Supplemental Security Income (SSI) for the disabled, Temporary Assistance to Needy Families (TANF), a nutritional program known as Women, Infants and Children (WIC), food stamps, free/reduced school lunch, public housing and health insurance for the poor (Medicaid).

Food assistance and Medicaid are the programs most commonly used by illegal immigrants, mainly on behalf of their American-born children who get automatic citizenship. On the other hand, legal immigrant households take advantage of every available welfare program, according to the study, which attributes it to low education level and resulting low income.

The highest rate of welfare recipients come from the Dominican Republic (82 %), Mexico and Guatemala (75%) andEcuador (70%), according to the report, which says welfare use tends to be high for both new arrivals and established residents.

3 jaw-dropping charts courtesy of Barack Obama and the Democrat party

Since Barack Obama ascended to the White House on his flying unicorn, some 12 million people have become dependent on food-stamps.

Since Democrats took control of Congress in January 2007, almost 20 million people have joined the rolls of food-stamp recipients.

(h/t DougRoss@Journal)

Obama famously quipped to Joe the Plumber that he thought it was good “to spread the wealth around.” The media attacked Joe the Plumber for daring to question Obama’s judgement. Under Obama, America racks up more debt in a single year – every year – than the entire GDP of Canada.

 

 

Gas prices have doubled since Obama became President. He and the Democrat party have done everything they can to ensure that America not tap into its vast energy reserves. He said that under his plan “energy prices would necessarily skyrocket”. Only, this is just lift off. The worst is yet to come.

 

More Americans work for the government than in all manufacturing, farming, fishing, forestry, mining and utilities COMBINED

Since more Americans work for the government than work in construction, farming, fishing, forestry, manufacturing, mining and utilities combined, when do we stop pretending that we are a free-enterprise, capitalist country?

We abandoned free-enterprise capitalism a long time ago, and because of it we are in debt up to our gills, the dollar has lost 90% of its value, and Liberals control nearly every sector of society.

Yet, it’s not enough for Democrats. Not nearly enough. They won’t be satisfied until the country is 100% socialist. That day won’t arrive, however, because the country will self-destruct before that happens. Then the Libs will get what they really intended all along, a communist totalitarian regime run by a politburo of Liberal elites. Kinda like the Obama Administration, only without any pesky Republican Tea Partiers to get in their way.

We are so screwed.

WSJ (h/t Weasel Zippers) — If you want to understand better why so many states—from New York to Wisconsin to California — are teetering on the brink of bankruptcy, consider this depressing statistic:

Today in America there are nearly twice as many people working for the government (22.5 million) than in all of manufacturing (11.5 million). This is an almost exact reversal of the situation in 1960, when there were 15 million workers in manufacturing and 8.7 million collecting a paycheck from the government.

It gets worse. More Americans work for the government than work in construction, farming, fishing, forestry, manufacturing, mining and utilities combined. We have moved decisively from a nation of makers to a nation of takers. Nearly half of the $2.2 trillion cost of state and local governments is the $1 trillion-a-year tab for pay and benefits of state and local employees. Is it any wonder that so many states and cities cannot pay their bills?

Every state in America today except for two — Indiana and Wisconsin — has more government workers on the payroll than people manufacturing industrial goods. Consider California, which has the highest budget deficit in the history of the states. The not-so Golden State now has an incredible 2.4 million government employees — twice as many as people at work in manufacturing. New Jersey has just under two-and-a-half as many government employees as manufacturers. Florida’s ratio is more than 3 to 1. So is New York’s.

Keep reading…

Obamanomics producing economic disaster on all fronts

Updated.

The Obama Administration is focussed on destroying what little hope is left in America. Stories abound today detailing what an absolute mess the U.S. economy is in, yet Liberals, RINOs, the state-run media, and Americans with their head in the sand continue to pretend as if everything is lemonade and lollipops.

I just posted about how gas prices have doubled since Obama took office. When oil prices shot up under George Bush, the Liberals went berserk and dragged the heads of the major oil companies in front of congress. They accused Bush and Cheney of a grand conspiracy. But a doubling of gas prices under Democrats is suddenly a good thing, or no thing.

Next we have a new report detailing the rise in food prices due to the inflation that the Fed says doesn’t exist. Wholesale food prices spiked 3.9 percent in February from January, the biggest jump in 36 years.

Chicago Sun-Times –  Wholesale food prices spiked 3.9 percent in February from January, the biggest jump in 36 years, the Labor Department said Wednesday.

Most of the increase was because of a sharp rise in vegetable costs, but meat and dairy prices also jumped. Harsh winter freezes in Florida, Texas and other Southern states damaged crops, driving up vegetable prices. Meanwhile global prices for corn, wheat and soybeans have risen sharply in the past year. That has raised the price of animal feed, pushing up the cost of eggs, beef and milk at the wholesale and consumer level.

Corn prices are up 59.4 percent from last year. Wheat is up 81 percent, and soybeans are up 29 percent, said Ephraim Leibtag, deputy director for research at the U.S. Department of Agriculture’s Economic Research Service.

So, gas and food prices are rocketing ever upwards, but at the same time home sales continue to plummet. New-home sales fell 16.9% to a seasonally adjusted annual rate of 250,000. Compared to February 2010, sales collapsed by 28%.

(MarketWatch via Dailybail) — Sales of new single-family homes collapsed in February, the Commerce Department reported Wednesday, as a combination of high unemployment, tumbling prices and a glut of cheaper alternatives brought activity to a near-standstill.

New-home sales fell 16.9% to a seasonally adjusted annual rate of 250,000 in February, though January’s figures were revised higher to 301,000 from 284,000. Compared to February 2010, sales collapsed by 28%.

 

 

Every region but the West saw record lows, and in the Northeast, sales dropped by 50% compared to year-earlier levels.

“The housing market has literally collapsed,” said Tony Sanders, a real estate finance professor at George Mason University. “We’re stuck, it’s not going to revive in the spring and may not in the summer.”

 

Economists polled by MarketWatch had expected a slight rise to a 290,000 rate in February. While inclement weather may have played a role in the particularly poor showing during the month — the particularly nasty dive in the Northeast and Midwest lends support to such a view — analysts said the figures were reflective of a basically dead market.

“The details of the new-home sales release clearly indicate that the housing market remains incredibly soft,” said David Resler, chief economist of Nomura Securities International.

“There’s massive excess [supply] on the market, interest rates are not at record lows, tighter credit standards, unemployment is not decreasing fast enough and throw in oil and gas prices, that sends a big stop sign on consumers buying homes,” Sanders said.

The USDA forecast says consumer food prices will rise 3 to 4 percent this year.

Next up, PIMCO boss Bill Gross, who runs the world’s largest fund, recently dumped all his Treasuries and just came out with this dire warning: America will default, thanks to trillions in entitlement obligations. He says, “We are out-Greeking the Greeks.”

…the only way out of the dilemma, absent very large entitlement cuts, is to default in one (or a combination) of four ways: 1) outright via contractual abrogation – surely unthinkable, 2) surreptitiously via accelerating and unexpectedly higher inflation – likely but not significant in its impact, 3) deceptively via a declining dollar  – currently taking place right in front of  our noses, and 4) stealthily via policy rates and Treasury yields far below historical levels – paying savers less on their money and hoping they won’t complain.

Meanwhile, America is spending more on the war in Libya than Democrats are willing to cut from the budget they continue to refuse to produce. What cuts may eventually be made will go to arming al-Qaeda in Libya. Isn’t Liberalism fun!

Welcome to the new normal!

Niall Ferguson discusses the West’s perilous days ahead

The always interesting historian, Niall Ferguson, seems to be making the rounds with the March release of his new book, “Civilization: The West and the Rest“.

I hope that some American outlets will invite him on to discuss his thoughts, but after the humiliation he delivered to MSLSD’s Mika Brzezinski, such invitations may be rare. Who knows?

Here, Mr. Ferguson speaks with UK Telegraph’s Robert Miller about his projections for the next decade, including the future of Europe, the MIddle East and the US, saying that in 2021 we’ll be amazed how much the world has changed.

Click the image below to view the interview where Prof. Ferguson brings up key points such as:  (h/t  Business Insider)

• China will be the largest economy in the world by 2021.
• No guarantees the euro will still exist.
• The U.S. could europeanize itself, or it could revitalize itself.
• Tiny possibility we get western-style democracies in the Middle East.
• More alarming to think about a “restored caliphate”.
• Germany’s love of European integration under threat.

click image to go view

More Telegraph interviews:

• Niall Ferguson on why UK must remember its killer apps
• Niall Ferguson on China will overtaking the US within a decade
• Niall Ferguson on why the US must avoid Britain’s mistakes
• Niall Ferguson on oil reaching $200

Here is another recent interview he did with ‘The Review Show’ about Dr. Ferguson’s new book.

Rand Paul Wishes He Had A Magnifying Glass

Rand Paul pleads in front of congress with a chart. He eloquently explains to all the deadbeats in just 2:42 what a mess we are in and that no one is taking the problem seriously.

House GOP’s $61 Billion Spending Cuts in Perspective

House Republicans are trying to cut $61 billion from the budget. Democrats are whining that that is way, way, WAY too much. But, in truth, $61 billion is almost insignificant.

Rand Paul wants to cut $500 billion right away, which is more like it, but unfortunately, he doesn’t stand much of a chance.

This from the Cato Institute will give you a good idea how miniscule $61 billion is:

10 signs that economic disaster is waiting to happen

Newsreal has a story on the ‘10 Economic Disaster Stories the Leftist Media is Hiding From You’.

Human beings have a built-in mechanism for ignoring speeding locomotives carrying bad news that are headed right for them: we pretend that if such locomotives exist at all, there is always some economic genius who will pull a lever and divert disaster.

Well, there are some smart people who would be willing to pull such a lever, but none of them reside in the Obama Administration.

Here are 10 signs that a train wreck is waiting to happen. Click over to the article for explanation for each one.

10. There are at least 884 “problem” banks on the FDIC books.

9. The coming municipal defaults.

8. High oil prices are disrupting police and emergency services.

7. The alternative currency movement is growing.

6. The market is flooded with counterfeit gold and silver.

5. 44,000,000 Americans are on food stamps.

4. Four out of every ten rows of corn go to fuel production

3. It will take less than one month for America to collapse if trucks stop running.

2. George Soros is hoarding gold.

1. Food distribution companies are warning of severe food shortages in the coming weeks.