Michael Pento – The World Is Now Headed Into A Depression

Today one of the top economists in the world told King World News that despite bounces, stocks will continue to crater and he has positioned his clients short for a collapse in global markets.  Michael Pento, founder of Pento Portfolio Strategies, also warned that central planners now have the world headed into a depression.

“You’ve seen the releases from China, and now the Fed is feigning an interest in letting markets work.  I believe it’s because they have duped themselves into believing that all of the cocaine they have put the economy on, in order to put a floor under real estate and give a boost to equity markets, isn’t the reason why we have some semblance of growth in global GDP. Continue reading

World risks fresh credit bubble, Switzerland’s BIS warns

Asset prices across the world have risen to heady levels not seen since the credit boom five years ago and may be losing touch with economic reality yet again, the Bank for International Settlements has warned.

The venerable Swiss-based institution – almost alone in warning of a global debt crisis in the build-up to the Great Recession – said it is rare for markets to gather steam at a time when the major forecasters are turning gloomy. Continue reading

Recession ‘taking hold’ in Eurozone, OECD says

With Greek at 24.4% in June and as the Eurozone facing an acceleration of inflation, one might expect to see more of what has taken place in Spain — just on a wider scale.

PARIS (AP) — Europe’s debt crisis is pushing the 17-country eurozone toward recession and dragging down the global economy, the Organization for Economic Cooperation and Development said Thursday.

Even growth in traditional economic powerhouse Germany is slowing, and the OECD’s interim assessment said that Europe’s largest economy could slip into recession by the end of the year.

Full article: Recession ‘taking hold’ in Eurozone, OECD says (AP)

Jim Rogers: It’s Going To Get Really “Bad After The Next Election”

Rogers, who for years has been an outspoken critic of the Feds policies of “Quantitative Easing,” says the world is “drowning in too much debt.” He put the blame squarely on U.S. and European governments for abusing their “license to print money.” In the U.S. alone, the national debt has surged to nearly $16 trillion, that’s more than $50,000 for every American man, woman and child.

“[They] need to stop spending money they don’t have,” Rogers said. “The solution to too much debt is not more debt… What would make me very excited is if a few people [in the government] went bankrupt…” Rogers added.

“Mrs. Merkel has an election next year,” Rogers said. “Mr. Obama has an election in November. The Americans and the Germans – they want to do everything they can to hold the world up until after the next election.

“It’s going to be bad after the next election.”

How bad? Worse than Rogers predicts, according to a new investigation.

In a newly released documentary that went viral last month, a team of influential economic experts say they have discovered a “frightening pattern” they believe points to a massive economic catastrophe unlike anything ever seen in the history of the world.

“What this pattern represents is a dangerous countdown clock that’s quickly approaching zero,” said Keith Fitz-Gerald, the Chief Investment Strategist for the Money Map Press, who predicted the 2008 oil shock, the credit default swap crisis that helped bring about the recession, and the Greek and European fiscal catastrophe that is still wreaking havoc until this day.

“The resulting chaos is going to crush Americans.”

“And what’s really disturbing about these findings is that the pattern isn’t limited to our economy. We found the same catastrophic pattern in our energy, food, and water systems as well.”

According to Martenson, these systems could all implode at the same time.

“Food, water, energy, money. Everything.”

Full article: Jim Rogers: It’s Going To Get Really “Bad After The Next Election” (Money Morning)

Four Reasons Why the Government Is Destroying the Dollar

The United States government has four interrelated motivations for destroying the value of the dollar:

1. Creating money out of thin air on a massive basis is all that stands between the current state of hidden depression, and overt depression with unemployment levels in excess of those seen in the US Great Depression of the 1930s.

2. It is the weapon of choice being used to wage currency war and reboot US economic growth.

3. It is the most effective way to meet not just current crushing debt levels, but to deal with the rapidly approaching massive generational crisis of paying for Boomer retirement promises.

4. Political survival and enhanced power for incumbent politicians.

In this article we will take a holistic approach to how individual short term, medium and long term pressures all come together to leave the government with effectively no choice but to create a high rate of inflation. If you have savings, if you rely on a pension, if you are a retiree or Boomer with retirement accounts – any one of these four fundamental motivations is individually a grave peril to your future standard of living. However, it is only when we put all four together and see how the motivations reinforce each other, that we can understand what the government has been and will be doing, and then begin the search for personal solutions.

Reason Two: To Hide A Depression

The second government motivation is to hide a depression, and while you wouldn’t know it from government press releases or media headlines, there has been a gaping hole in the US economy since 2008, as illustrated below:

During the first round of the financial crisis, the US private economy nearly collapsed, threatening to send the US economy straight into deep depression. We’re talking about a $1.3 trillion private sector collapse that was contained only by the government fantastically increasing the money it spent, even while tax revenues were falling. The creation of huge government deficits has been all that has maintained even a facade of semi-normalcy. Remove the mechanism of the government creating money so that it can spend what it doesn’t have, and it is straight to official Great Depression-level unemployment in months, as illustrated in the graph below.

Full article: Four Reasons Why the Government Is Destroying the Dollar (Financial Sense Online)

Why the U.S. Is in an Invisible Depression

As a small example and although not complete evidence of a ‘depression’, as there are many components and economic indicators, this can even be evidenced at your local supermarket. We’re talking about inflation. Though most would believe inflation means only higher prices and an out-of-control downward spiral of monetary value, it’s not the only indicator. The next time you decide to purchase a can of soup, you might notice the quantity of each can produced went from 15 ounces to 12, for example. That’s not to say you’re being ripped-off by the company selling you the product, but an indicator that they also have to adjust their pricing models in response to their rising production costs due to their suppliers raising costs as well. In summary: You’re paying the same amount for less. The same goes for rice, sugar, ice cream and other various food/beverage products.

According to Al Lewis on The News Hub, we’re actually in a depression right now, but most people don’t see it. One out of seven Americans are on food stamps – if they weren’t getting cards in the mail every month, you’d see them in soup lines.

Video link: Why the U.S. Is in an Invisible Depression (Wall Street Journal)