Experts Warn Government of Massive Recession, Martial Law, Food Stamp – Massive Riots, Huge Crime Waves Expected in Many US cities

The Coming Crash & The Recession That Never Ended

Some experts say the partial government shutdown could send the economy into a recession if it continues. Tax refunds might be delayed and vital benefits like food stamps may not arrive, taking billions of dollars out of circulation. Washington Post economic policy reporter Damian Paletta joins CBSN with more.

Another reason for the lack of quality jobs is that the government cannot institute a policy to buy American or they risk a trade war with other nations in the global economy that are also living beyond their means. The trade war probably is coming anyway because unemployed people of nations will demand that their government do something to protect their jobs and all government can do to keep jobs at home is to allow protectionism.

That happened in the 1930’s and it made a bad recession into a long world depression. That now seems to be our future and along with the deflation depression or hyperinflationary depression that is bound to come, it will allow the rise of populist demigods who will convince people that they know who is to blame and that they have all the answers. In other words, we are now repeating the same mistakes of the 30’s that led to the nationalist socialistic movements and the start of World War II. It will not be different this time except the stakes for the world will be much higher.

The same mistakes in housing in the US are being made all over again. I do not think this is a good time to invest in residential real estate unless you plan to actually live in the house. The recent climb in values will probably be short lived as this country goes back into the next phase of this depression. Foreign investment speculators who think we are in recovery are once again buying real estate and driving up prices. The percent of Americans owning their own home is actually still falling and have fallen to 1990’s home ownership levels. Family income in the United States and hours worked is still falling. The recovery is mostly phony and what recovery there seems to be is really built on the Federal Reserve creating more money and more government borrowing. The recovery is going to speculators in the top one percent. The rich are getting richer and the poor are getting poorer.


If I have a sure message to people who are listening, it is this – Learn to live on an income that is less than half of what you were living on in your good times. Within the decade your income will be far less and/or it will buy far less goods and services. Also prepare for big government trying to manage and run every aspect of people’s lives. Certain people are going to think the only way to handle this is through forced government control and then rationing. Do not be surprised if there is civil breakdown and even Balkanization’s when the people get fed up. It has already started in some nations. It is going to get much worse than most anyone imagines.

As with all forms of gambling, derivatives trading carries a certain amount of risk.
The scary part is that we are all exposed to the enormous derivative risks that the biggest U.S. banks have become entangled in, despite assurances to the contrary:
“Overall, the biggest U.S. banks collectively have more than 247 trillion dollars of exposure to derivatives contracts. That is an amount of money that is more than 13 times the size of the U.S. national debt, and it is a ticking time bomb that could set off financial Armageddon at any moment. Globally, the notional value of all outstanding derivatives contracts is a staggering 552.9 trillion dollars according to the Bank for International Settlements. The bankers assure us that these financial instruments are far less risky than they sound, and that they have spread the risk around enough so that there is no way they could bring the entire system down.”

The first question almost everyone always asks about the economy is whether or not we’re headed for a recession. The second question: will the next recession be a bad one, like the Great Recession, or will it be relatively mild by comparison? This column answers both questions, analyzing economic growth data to see where the world is headed and how rough it might be for business.

What is a recession?
A recession is generally considered a slowdown of economic activity as measured by GDP (gross domestic product) lasting two consecutive quarters or longer. The National Bureau of Economic Research (NBER) has a more expansive definition of recession:

A recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales. A recession begins just after the economy reaches a peak of activity and ends as the economy reaches its trough.

The NBER measures economic activity as more than just GDP and doesn’t require two straight quarters of decline to mark the beginning of a recession. The Great Recession offers an interesting example of why this matters. According to the NBER, GDP declined in December of 2007 and the first quarter of 2008 but grew in the second quarter before declining again in the third and fourth quarters of 2008 and the first quarter of 2009.

This may seem like a distinction without a difference, particularly since it’s often used after the fact to identify periods of recession and recovery. To some extent, that’s true; these measures don’t do much good to address a recession that’s already happened. On the other hand, the research into recessions and the various measures that can identify when the economy is slowing or is at risk of recession can help economists and policy makers more quickly and effectively address future recessions.

Historically, recessions have lasted about a year and a half on average, but more recently, they have tended to be shorter. Since 1945, the average recession in the U.S. has lasted less than one year.

“Economic recessions are caused by a loss of business and consumer confidence,” WorldMoneyWatch president and U.S. economy expert Kimberly Amadeo explained in a post for The Balance. “As confidence recedes, so does demand. A recession is a tipping point in the business cycle. It’s where the peak, accompanied by irrational exuberance, moves into contraction.”

But when will the next economic recession take place? “Calling the precise time of the next global economic recession is notoriously difficult,” wrote Desmond Lachman, a resident fellow at the American Enterprise Institute (AEI) and a former deputy director at the International Monetary Fund, in a recent article for Seeking Alpha. Moreover, nobody’s really sure how bad of a decline it will be when a recession eventually hits.

Recessions can be total and catastrophic, but most tend to be rolling – moving from sector to sector, leaving people in one sector to pick up the pieces and move on even as another is entering into the maw of the storm itself.

Recessions are also by definition deflationary. They reduce demand by reducing available purchasing power and credit, and supply (and actual price) then follows. It’s rare for a distributor to reduce the direct asking price for a product. Instead, you see larger and larger discounts. A $350 television set gets discounted to $250, then $150, then $99 because the distributor wants to move excess inventory. The notional “price’” of the television set remains the same, but once an item begins its slide into discount territory, it almost never makes it back to its base manufacture suggested retail price.

With people out of work, there are comparatively few mechanisms available for getting money back into their hands. Tax relief can work, but in general such tax relief generally puts most of the money back into the hands of the wealthiest, rather than to those who have lost their jobs and hence are paying comparatively little taxes (or none at all). Unemployment “benefits” are taxes levied on companies precisely to handle the scenario of workers being let go, but quite frequently the payment out of this fund gets political quickly, and as often as not it is intended only to supplement, not replace, lost income.

It has been said that recovering from a recession comes down to re-establishing trust. While that’s true, it’s also somewhat simplistic. A recession resets values, and stress tests businesses, and in many respects the next recession will be one of the most rigorous stress tests that most business have faced in the last 100 years.

Recessions are an economic reality. They’re also difficult to predict with any precision; they typically start before anyone even knows they’re happening and end before economists have enough data to know they’re done. Moreover, they’re also usually pretty short. Since the end of the Great Depression, there have been 13 recessions in the U.S., and 9 of those were less than one year in duration.

But the individual impacts of a recession can be much bigger and longer lasting, causing permanent financial damage to those who aren’t prepared to ride out the short-term implications and quickly get back on their feet. Millions of Americans still haven’t recovered from the Great Recession (2008-2009). Many never will.

The United States is now by far the biggest debtor nation in the world. For many years we have been importing hundreds of billions more dollars in goods and services than we are exporting each year. In 2005 through 2008 the trade imbalance averaged well over 700 billion dollars per year! Trillions of US dollars are now in the hands of foreign investors who at any time could dump the dollar causing a devaluation of the currency.

During the presidency of Bill Clinton the US government was forecasting surpluses of trillions of dollars based on the stupid assumption that there would not be a downturn in the economy for decades. This foolish assumption was of course proven wrong and deficit spending in 2009 and 2010 will be at least two trillion dollars a year if everything is really counted. The only reason the United States is not yet feeling the pinch of spending beyond its means has been the record low interest rates. The low interest rates were brought about by Federal Reserve manipulation to stimulate the economy but interest rates eventually will have to rise. Soon all who need loans will be making higher payments and the US government will be paying much more to service the national debt.

Debt and unfunded liabilities promised through entitlement programs is now about 125 trillion dollars. This amount of money in non inflationary dollars is impossible to raise! Thus, the US is now technically bankrupt. In order to keep up the facade that the US is solvent for even another decade or two, one or more of the following must happen.

1. Taxes must be raised.

2. Government spending will have to be drastically cut.

3. Deficit spending will dramatically increase.

If taxes are raised, it will kill the economy and the debt load will get worse and not better. Spending will not be drastically cut because these types of cuts would never get through the political system. Therefore, massive deficit spending will take place. The monetary system will be inflated so that this debt can be paid by using a dollar worth only a fraction of what it is today. This means a much weaker dollar in the future and much higher prices for all goods and services imported to the United States (in short it means we should expect high inflation or hyper-Inflation).

The best long term scenario is that the economy will expand for decades and we will partly grow our way out of this debt crunch (like we temporarily did under Ronald Reagan). But, I do not see stability for that length of time as even a remote possibility in this world full of crises. I think it is only a matter of time before another downturn in the economy or an unforeseen world event brings about the collapse of this house of cards.

Pentagon resources and U.S. troops may be used if needed to quell protests and bank runs during an economic crisis, the U.S. Army War College’s Strategic Institute reported.

“Widespread civil violence inside the United States would force the defense establishment to reorient priorities in extremis to defend basic domestic order and human security,” the War College study states.

Incidents of economic collapse, terrorism and disruption of legal order could require deployment of forces within the U.S., it said.

A “strategic shock” could require the nation to use “military force against hostile groups inside the United States.”

“Social unrest may happen in many countries – including advanced economies” if the economic crises are not properly dealt with, Strauss-Kahn said.

“He added that violent protests could break out in countries worldwide if the financial system was not restructured to benefit everyone rather than a small elite,” London’s Guardian reported.

In a recession where consumer spending is plummeting, foreclosures are rampant, workers are losing jobs, credit is tight and markets are strained, some are warning about a worst-case scenario.

47.6 million Americans are about to have their food stamp benefits cut, and most of them have absolutely no idea that it is about to happen.

Needless to say, a lot of them are going to be very angry when they discover that they cannot buy as much food for their families anymore. The reason that this is happening is because a temporary boost to food stamp benefits that was put in during the last recession is expiring. But most of the people that are having their benefits cut will not understand this.

Most of them will just be very upset that the government is “taking money away” from them. And considering the “mini-riots” that we witnessed earlier this month when the system that processes food stamp payments went down for a few hours, it is obvious that a lot of food stamp recipients can very easily be pushed over the edge. So what would happen if we have another “debt ceiling crisis” in Washington D.C. early next year and food stamp benefits are temporarily cut off completely?

Wherever “austerity” has been tried in Europe, it has resulted in protests and riots. Could a similar thing happen in this country?

NBC News is reporting that ALL food stamp recipients are going to have their food stamp benefits reduced in November. This is certainly not going to put those living in poverty in a good mood…

Millions of American families could face a sparse holiday table when food stamps benefits get reduced in November, and that could be just the start of deeper cuts to the program to feed poor families.

The modern-day food stamp plan, now called the Supplemental Nutrition Assistance Program, is scheduled to scale back benefits for all recipients on Nov. 1 because a recession-era boost in benefits is expiring.

Sadly, the truth is that food stamp benefits don’t even buy a lot of food right now. According to the USDA, the average monthly food stamp benefit is approximately $272 per household.

And now it will be even lower.

The government says that a family of four will be getting 36 dollars less per month starting on November 1st.

That may not sound like a lot to you, but for those living on the edge of poverty it can make a huge difference.

What are impoverished families supposed to do? Eat a diet that consists entirely of Ramen noodles?

Of course the real solution would be to provide good paying jobs for those families, but unfortunately our leaders continue to pursue policies that are systematically killing American jobs so that is not going to happen.

Meanwhile, those living in poverty continue to become angrier and more frustrated.

We got a glimpse of this earlier this month. The following is a brief excerpt from a recent article posted on offgridsurvival.com…

Over the weekend, the debit system that allows people on government assistance to buy food, temporarily went down. The resulting chaos is a small glimpse at what I believe will happen, should the government plunge this country into some sort of economic collapse.

A couple of Walmarts in Louisiana decided to allow people to shop, even though the system was down and they had no real way of knowing how much credit people had on their cards. The resulting chaos had the store’s shelves in Springhill and Mansfield, LA stripped bare, as food stamp recipients attempted to defraud the grocery stores.

When the system went back online, the grocery store found people who had as little as .49 on their Food Stamp cards attempting to steal over $700 in food. Local police were called in as the crowd started to turn ugly, and overflowing grocery carts were left abandoned in the aisles.

But this is just the beginning. To get an idea of what is eventually coming to America.

As poverty continues to grow and government handouts continue to get cut back, the desperation of those living in poverty in this country is going to continue to increase.

At this moment, there are 6 million Americans in the 16 to 24-year-old age group that are neither in school or working. In fact, a whole bunch of major U.S. cities currently have more than 100,000 “idle youth” living in them…

Just look at some of the nation’s largest cities. Chicago, Houston, Dallas, Miami, Philadelphia, New York, Los Angeles, Atlanta and Riverside, Calif., all have more than 100,000 idle youth, the Opportunity Nation report found.

It is only a matter of time until we see massive riots and huge crime waves in many of those cities.

The conditions for a “perfect storm” are already here.

All we need is a spark.

According to a brand new Pew Research survey, only 19 percent of all Americans trust the government. Back in 1958, 73 percent of all Americans trusted the government.

Right now, only 23 percent of all Americans have a favorable view of Congress. Back in 1985, 67 percent of all Americans did.

Anger and frustration are growing and our society is breaking down all around us.

Get ready while you still can.

Self-Reliance Is Key

The biggest hurdle of the Great Depression was a simple one: lives changed drastically – and they changed fast. Americans went from the lavish roaring twenties, where elegance and jazzy splendor perfused the nation, to scrubbing out a meager existence.

Those who survived it were never the same. They stockpiled more. They reused more and shopped for bargains, not luxuries. They fully understood that a trip to the grocery store may be the last for a very long time.

That’s the biggest lesson learned from surviving the Great Depression: Self-Reliance skills are essential to get you through the harsh times. The survival skills that our modern world has since lost.

It’s time we discover them again.

The Lost Ways 2 program is to reveal all the ancient techniques and secrets used by our forefathers to deal with harsh conditions such as diseases, wars, drought, and other life-threatening conditions.

In this program the author explains how to grow and store these foods for a long time in pit holes. Other than this, you will find a lot other valuable information explained in this guide on topics such as finances, health, and life crisis among others.

Basically the guide covers majorly on the super nutrient foods that can help you survive during times of food shortages. These foods have a longer lifespan which enabled our ancestors to store them even when they didn’t have access to refrigerators and other related technologies.

Inside this document you will discover how the pioneers from the Wild West hunted deer and how they tanned hides without chemicals and without spending a dime. You’ll also find out how to butcher a deer and what parts are best for certain preservation methods.

Lost Way 2 – second edition show you how to use the activated charcoal to build yourself a simple and reliable water filter that can clean 800 gallons of water.

When all the water is contaminated, and all you can find are muddy creeks and pools with diseases running rampant you’ll keep your loved ones drinking crystal-clear healthy water. Activated charcoal pills are very useful in treating acute food and chemical poisoning too.

 

 

 READING ARTICLES IS NOT ENOUGH. YOU ABSOLUTELY NEED THIS BOOK TO UNDERSTAND WHAT IS HAPPENING IS YOU ARE TO SURVIVE WHAT IS COMING.

1 Comment

  1. Richard

    What few understand is that during a recession depression, the govt needs to end all taxes that are derived from the individual from the individuals work. The Income Taxes need to be eliminates. Taxes from purchases, taxes that are immediate, are the only taxes that can be obtained by a weak government.
    The citizens need their money to live off of. and stealing it in income taxes, land taxes, are just out right theft.
    We need to change from elections to lottery selections. We need a lottery system, that is how our leaders need to be selected. Define the job in terms of education, experience, work history, etc, and then pay a vetting fee and then if the person meets the criteria, their name is put into the hat and come selection day, a name will be selected for that term.

    As far as government staff, 6 years maximum. An individual can work in a government job for a total of 6 years. No More. The deep state was created by allowing career government staffers. This opens the door for corruption and evil.

    1. Lottery, not elections
    2. 6 year maximum government staff work limit.

    Reply

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