Economic Double Dip – Or Double Tap?
by Mac Slavo: Police
State Interrogations: Obama Rolls Back Miranda Rights
From the very
beginning, mainstream media and government officials have down-played
the economic crisis. In 2007, when the crisis started in the midst
of the Presidential election, John McCain and other republicans
actually refused to talk about it. It was not until the banking
and mortgage crisis became apparent in late 2008 that McCain called
for a suspension of his Presidential campaign so that he and then
candidate Obama could return to Washington to save the American
economy. A crisis that had taken many years and tens of trillions
of dollars in leverage to create would be resolved, if you believed
Congress, within a matter of a couple weeks through the passage
of an $800 billion dollar "bailout."
It was serious
enough for Congressman Brad Sherman to tell us Congress had been
warned about the possibility
of martial law and tanks in the streets, but not serious enough
to warrant any significant changes to how regulatory agencies investigate
financial fraud or legislation that would make it easier for Americans
to start and grow their businesses. Backed by 24 by 7 media propaganda,
the crisis was quickly marginalized and within few months the stock
market came roaring back.
used by the best and brightest on Wall Street and in the fourth
estate has attempted, from the get go, to coerce Americans into
believing that things on Wall Street and Main Street were business
as usual. While alternative media and contrarian economists warned
Americans about impending doom in financial markets, the economy
and geo-political happenings around the world, media pundits downplayed
the possibility, referring to it only as a "double dip." This, of
course, conjures up images from our childhood. A double dip isn't
all that bad – it can't be bad – it usually comes with whip cream
and a cherry on top.
They – meaning
the state sponsored media machine – is very adept at the language
they use, how they use it, and how often they repeat it. It's so
effective, that 80% of Americans have no clue that the United States
is insolvent and on the brink of bankruptcy, that nearly one in
five Americans are out of work, and that the negative economic feedback
loop is in full swing. And of those that do have a clue, the majority
believe it's a temporary misstep soon to be resolved by policies
of borrow and spend.
It's just a
double dip. Close your eyes, take a bite, enjoy the creamy sweetness.
Everything's yummy and it'll all be okay – you'll see.
This from the
same people who in 2007 had not an inkling that the economy was
about to fall into the worst recession in nearly a hundred years.
same people who didn't see it coming, refused to explain what was
after it came, and continue to act shocked and surprised as the
economic and fiscal situation in the U.S. deteriorates, will never
give you the bad news – unless it suits their financial goals and
As we've highlighted
for over two years now, things are most certainly not as they seem.
tens of trillions of dollars deeper in the hole now than we were
in 2007. There's as much, if not more, leverage in the system today
as there was then. Wall Street, it turns out, is now more corrupt
than ever as failing institutions were merged with too-big-to-fails.
There is no regulation to be had. There have been no significant
criminal prosecutions. Main Street has gotten nothing but platitudes.
And the worst of it is that the US government is enabling the entire
thing. Double dip cones for everyone!
is, that our economic system is not experiencing a double dip. Looking
at the latest data, it should be clear that we have been double
tapped, and we're falling quickly into another recession within
the Greatest Depression.
A quick breakdown
of some key economic data points from the last two weeks should
make in abundantly clear that the end of the party is nigh.
Is Rising: Economists expected the economy to create
150,000 jobs this month. We created 40,000 fewer jobs than expected
for a whopping
9.1% U-3 unemployment rate. Counting discouraged and part-time
workers looking for full time work, we're at about 17%. Then,
of course, there's the matter of the folks who have fallen off
the unemployment rolls. They number in the millions, but they
don't count anymore – apparently they're enjoying double dips
at the local ice cream shop. Incidentally, in response to today's
report of a 9.1% unemployment rate, the White House's chief economist
said that these are just "bumps on the road to recovery." So,
now that we are back in the double dip, we can expect the marketing
message to change – it's just a bump.
is Toast: It's happening just as we forecast two years
ago. The second
wave is in full effect and no $8,000
new buyer tax credit is going to stop it. A 3.6%
drop year over year, and we can expect, at a minimum, another
20% from here. We've said it before, and we'll say it again, from
top to bottom this real estate market will see declines of between
50% to 75%. It's a long way to go before real estate stabilizes
in real value terms (Fed printing might keep prices seemingly
within the range of where they were in the mid 2000′s, but
that means the cost of everything else will be rising as well,
significantly outpacing the housing market).
beware of EU member who bear gifts: Europe is a disaster.
It may not seem important to us here in the US, and our leading
economists certainly rarely, if ever, mention it. But it is important
to note that one of the key reasons for why the Great Depression
of the 1930′s happened was because of European defaults.
Guess what? It will happen again. Less than a year ago they told
us Greece had to be saved – and that they had a plan. The EU and
IMF would lend them a bunch of money that they couldn't pay back,
and that would resolve the problem. Woops – it turns out that
borrow and spend didn't work so good for Greece. They're in serious
trouble again, their bonds are collapsing, and they are in more
debt now than last year. New plan: lend them more money, and this
time, double dips for everyone!
Aren't So Confident Anymore: What is America without
a confident consumer base? In a depression, that's what. And right
now, our consumer
confidence numbers are collapsing. It might have something
to do with the weather, as is often claimed by mainstream media.
It's the heat. It's the snow. It's the tornadoes. Or maybe, just
maybe, it's that everyone is broke, the banks aren't lending to
consumers (unless you're going to college) and people are terrified
that next week they're going to get a pink slip. We'll let out
astute readers make up their own minds on this one.
is collapsing: Turns out that when consumers stop buying
stuff, the people who produce that stuff don't get orders from
the companies that sell it. The end result is collapsing manufacturing
sector, which is exactly what we saw happen earlier this week
with the ISM
Stamps For Everyone! Putting all other economic indicators
aside, you can look to the food stamp participation rate to get
a real idea of what this crisis feels like on Main Street. 44.2
million people require assistance from the government to eat.
To eat! We've projected this is going to 50
million within another 12 to 18 months. Now we're learning
that Congress may actually be looking to cut food stamp programs.
Bad news considering that commodity prices will continue to rise
over coming years, effectively reducing those food stamp benefits
through dollar depreciation. Riots in the streets won't be far
We leave it
to our readers to believe what they will about the current state
of our economy. But we have a hard time believing this is anything
but a further decline on our way to complete
We can expect,
of course, that as soon as stock markets respond with declines,
The Federal Reserve will begin the next phase in the destruction
of the US dollar. Treasury will spend even more money to prevent
tanks on the streets of America. Mainstream media will tell us that
even if there is a depression there are effective pharmaceuticals
that can help. And, President Obama will play another round of golf
and give us his top picks for the upcoming NFL season.
It's all good.
Take the kids to Disneyland. Borrow money to get there from anyone
who'll lend it to you if necessary. And most importantly – don't
forget to enjoy a yummy ice cream cone – double dip if you've got
the cash to cover it.
from SHTF Plan.
Slavo [send him mail] is a
small business owner and independent investor.
© 2011 Mac Slavo
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