Global Economy Bursting?

[Couch Potato]

The S&P may hit the 200 day moving average, or get close to it maybe 1275 range and then try to get back up. If it passes any of its previous highs once it hits those ranges, it will try to shoot up to 1400 or close to it and then we will have a major, major correction.

It will certainly either go up or down. If you like to gamble it is a great time for that. My only prediction is 30 years from now it will be higher than it is today. I might be wrong, but that is the bet I am making. :new_all_coholic:

 

[Austin]

Amid all this talk of a great depression looming, financial collapse, the stock markets tanking etc., I personally see no cause for concern. This nation is like an atomic clock. The economy has huge demand and the technology and resources to keep it humming. The problem is not the economy or capitalism, the problem is government. The chickens of Lyndon Johnson are coming home to roost, the welfare state is bankrupt with millions of mouths to feed, mostly breed at the government’s breeding farm, and the wherewithal to feed them is exhausted.
The alarm is not about economic depression or financial collapse, the alarm is that the powers that be know that when the bottom falls out their necks will be in the noose. I read an article on Chicago yesterday about the crime around the city and mayor Emanuel promising to clean up the mess. The problem is 40,000 young minority men in gangs all unemployed and ravaging the town. The situation is out of control. It is not just the big northern cities; it is the small southern town in Virginia I live near known as Miami North because it has been taken over by rival drug gangs of minorities with daily murders and shootings. Well, if the authorities can’t control this then how can they control the situation when the food runs out, the government checks stop coming and the medical system breaks down. It has broken down in the town I live near.
Some of you are too young to remember but I can remember back in the late 1970’s or 80’s the congress made some cuts or something to Social Security. Seniors took to the street in one instance surrounding the car in which the Democratic majority leader was riding in and pounded it with their fists. Within days the law was reversed. Their collective memory is well intact on this issue. The jig is up and they know it. It is just a matter of time. I read yesterday that Detroit, Michigan’s population dropped from 1.8 million to 900,000 with 400,000 African Americans and 300,000 Muslims the rest mostly Hispanic. Cut off the government checks and watch what happens in Detroit.

 

[Randolph Kinney]

Government services are being cut. Services like fire and police along with garbage pick ups. This is the result of budgets being cut, to balance against reduced tax revenues brought on by falling home values and rising pension and benefit costs for unions. In order to pay retirees, current union jobs are eliminated. Many cities across the U.S. are technically bankrupt.

Schools are failing and drop out rates have risen over the last decade. High unemployment for young people with no hope of ever getting a job that will support them in the lifestyle that was what they were raised in is the new normal.

Even college graduates can't find work. More children are moving back home to live with their parents. Family formation is falling in tandem with home ownership rate. College graduates are also saddled with crushing school loans they can't pay back even if they do find work.

In summary, there is a gap between generations and wealth. There is not enough earning power in the young generation to buy the older generation's homes at today's prices.

My projection is for the economy to stall, essentially zero growth inflation adjusted with rising unemployment. We have structural problems that require structural solutions.

The markets need to reflect that new reality.

 

[Randolph Kinney]

'Unpaid Student Loan' Raid Claim Refuted as Feds Target California Couple in Fraud Probe

Read more: http://www.foxnews.com/us/2011/06/0...ds-target-california-couple-in/#ixzz1OmkPy4t0

In a statement to FoxNews.com, Education Department Press Secretary Justin Hamilton confirmed that its Office of Inspector General executed the warrant with the presence of local law enforcement authorities.

Wright, who could not be reached for comment on Wednesday, told ABC News 10/KXTV he does not have a criminal record and had no reason to believe what he thought was a SWAT team would be breaking down his door before dawn. But according to a federal search warrant provided to the station by Wright, the Wrights are being investigated for alleged financial aid fraud.

The search allowed for the seizure of any student financial aid documents, W2 forms and electronic communications.

Yes indeed, the new normal, get use to it.

 

[Randolph Kinney]

California Wind Farms Impact Golden Eagle Population

http://www.care2.com/causes/environment/blog/California-Wind-Farms-Impact-Golden-Eagle-Population/

Wind turbines have killed an average of 67 golden eagles per year since the wind farm was constructed in the 1980s.

They taste just like chicken when cooked like chicken.

 

[Randolph Kinney]

Stockton: We're No Vallejo, But ...

http://www.bondbuyer.com/issues/120_106/stockton-california-bankruptcy-1027403-1.html

Stockton is facing a $37 million deficit in a budget with $160 million of revenues, a 60% increase from last year’s $23 million gap. The budget hole is expected to grow to $48 million by 2014 without major changes.

The main reason for the growing deficit is rising employee wage and benefit costs that are locked into contracts, especially with public safety, which represents 80% of general fund spending.

The multimillion dollar deficit comes after the government has already cut 25% of its workforce in the last two years.

In October, Stockton’s unemployment rate hit 19.6% and in April it stood at 17.3%, one of the highest in the nation, according to the U.S. Department of Labor.

The city’s budget is due June 21 and the much anticipated outcome of negotiations with the firefighters union is expected soon.

 

[Randolph Kinney]

Today there are more than 44 million Americans on food stamps

The number of children living in poverty has gone up by about 2 million in just the past 2 years

Only 66.8% of American men had a job last year

Since August, 2 million more Americans have left the labor force

In 2010, more than a million U.S. families lost their homes to foreclosure. That number is expected to go even higher in 2011

The combined debt of the major GSEs (Fannie Mae, Freddie Mac and Sallie Mae) has increased to 6.4 trillion in 2011

The Chinese are rapidly dumping U.S. government debt. Faith in the U.S. dollar and in U.S. Treasuries is rapidly declining

 

[Randolph Kinney]

U.S. funding for future promises lags by trillions

http://www.usatoday.com/news/washin...2-trillion-in-debt_n.htm?loc=interstitialskip

The government added $5.3 trillion in new financial obligations in 2010, largely for retirement programs such as Medicare and Social Security. That brings to a record $61.6 trillion the total of financial promises not paid for.

The $61.6 trillion in unfunded obligations amounts to $527,000 per household.

 

[Couch Potato]

Trade deficit "only" 43 billion.

Once upon a time that was high for a year, but now it is low for a month.

 

[Randolph Kinney]

That trade deficit will get decidedly worse in coming months. OPEC is not producing enough oil and cannot match demand for oil as it is. Any growth in demand for additional oil will show up in price increases as the market rationalizes or allocates supply using the price mechanism.

Food cost will be climbing faster as crop harvests and inventories are falling.

Corn futures reach record; USDA cuts crop outlook

http://www.marketwatch.com/story/co...sda-cuts-crop-outlook-2011-06-09?siteid=nwhpm