Wall Street adviser: Actual unemployment is 37.2%, ‘misery index’ worst in 40 years

Don’t believe the happy talk coming out of the White House, Federal Reserve and Treasury Department when it comes to the real unemployment rate and the true “Misery Index.” Because, according to an influential Wall Street advisor, the figures are a fraud.

In a memo to clients provided to Secrets, David John Marotta calculates the actual unemployment rate of those not working at a sky-high 37.2 percent, not the 6.7 percent advertised by the Fed, and the Misery Index at over 14, not the 8 claimed by the government. Continue reading

Detroit’s Default May Spark U.S. Death Spiral of Debt

Debt is deadly, and it’s made even worse with rising interest rates that can prevent you from eliminating the load. What happens with rising interest rates is that more of the payments go toward the interest and less to the principal. In fact, it’s what I call a death spiral of debt that worsens as rates move higher.

When individuals face excessive debt, often the solution is to reduce spending and adhere to a strict repayment program. Continue reading

Europe’s Unemployed: An Army Waiting for a Leader

As Europe edges toward mass anarchy and chaos, the Catholic Church is emerging as the key mediator between Europeans and their leaders.

Europe’s unemployment crisis is one everyone knows about, but no one is thinking seriously about. Continue reading

François Hollande wants 75% company tax on salaries over 1m euros

French president François Hollande may have finally found a way to tax the really rich: by making their companies pay.

In a televised interview on Thursday night, he said he wants companies that pay their employees more than €1m (£840,000) to pay 75% tax on those salaries. Continue reading

Senators in Immigration Talks Mull Federal IDs for All Workers

Key senators are exploring an immigration bill that would force every U.S. worker—citizen or not—to carry a high-tech identity card that could use fingerprints or other personal markers to prove a person’s legal eligibility to work. Continue reading

Money for Nothin’ Writing Checks for Free

When coming from PIMCO, alarm bells should be going off.

Mr. Bernanke never provided additional clarity as to what he meant by “no cost.” Perhaps he was referring to zero-bound interest rates, although at the time in 2002, 10-year Treasuries were at 4%. Or perhaps he knew something that American citizens, their political representatives, and almost all investors still don’t know: that quantitative easing – the purchase of Treasury and Agency mortgage obligations from the private sector – IS essentially costless in a number of ways. That might strike almost all of us as rather incredible – writing checks for free – but that in effect is what a central bank does. Yet if ordinary citizens and corporations can’t overdraft their accounts without criminal liability, how can the Fed or the European Central Bank or any central bank get away with printing “electronic money” and distributing it via helicopter flyovers in the trillions and trillions of dollars?

Well, the answer is sort of complicated but then it’s sort of simple: They just make it up. When the Fed now writes $85 billion of checks to buy Treasuries and mortgages every month, they really have nothing in the “bank” to back them. Supposedly they own a few billion dollars of “gold certificates” that represent a fairy-tale claim on Ft. Knox’s secret stash, but there’s essentially nothing there but trust. When a primary dealer such as J.P. Morgan or Bank of America sells its Treasuries to the Fed, it gets a “credit” in its account with the Fed, known as “reserves.” It can spend those reserves for something else, but then another bank gets a credit for its reserves and so on and so on. The Fed has told its member banks “Trust me, we will always honor your reserves,” and so the banks do, and corporations and ordinary citizens trust the banks, and “the beat goes on,” as Sonny and Cher sang. $54 trillion of credit in the U.S. financial system based upon trusting a central bank with nothing in the vault to back it up. Amazing! Continue reading

Enter At Your Own Risk: Police Union Says ‘War-Like’ Detroit Is Unsafe For Visitors

How far has the nation gone downhill? This far:

DETROIT (WWJ) – The men and women of the Detroit Police Department believe the city is too dangerous to enter, and they want citizens to know it. Continue reading

Germany Says ‘Great Uncertainty’ About US Debt

German Finance Minister Wolfgang Schaeuble questioned on Tuesday how the United States could deal with its high levels of government debt after November’s presidential election.

In a speech to the Bundestag lower house of parliament to open a debate on the 2013 German budget, Schaeuble said worries about U.S. debt were a burden for the global economy, hitting back at Washington which has criticized Europe for failing to get a grip on its own debt crisis.

In private, German officials often express concern about U.S. debt levels and the inability of politicians there to reach a consensus on how to reduce it, but Schaeuble’s public remarks underscore the extent of the worries in Germany.

Full article: Germany Says ‘Great Uncertainty’ About US Debt (CNBC)

Coal Industry Under Attack

A map has been generated at FreeMarketAmerica.org which tracks jobs lost on account of the Sierra Club’s war on coal. The data for the map comes from the National Mining Association, which says that over 1.2 million jobs have been lost in the coal industry. If mining stocks haven’t been doing well – whether we are talking coal or even gold – consider the environmental hits taken by the mining industry. Like the timber industry in the Pacific Northwest, coal mining has been specially targeted for reduction.

It’s true, of course. Last June Bloomberg ran a piece, “Displaced coal miners face slim job prospects.” All around the country, coal jobs are being lost. Coal is one of America’s key energy resources. It is an energy resource we don’t have to import. But the Obama Administration appears determined to crush the coal industry in order to save the planet from global warming. The Environmental Protection Agency (EPA) believes global warming is caused by greenhouse gases produced by coal as well as oil. Therefore, a radical effort is underway to curtail the use of coal.

Only a few years ago more than half our electricity was generated from coal. In the first quarter of 2012 the generation of electricity from coal dropped 21 percent from 2011 levels. The immediate culprit is the Cross-State Air Pollution Rule (CSAP). You can read about it at the Web Site of the EPA where it states: “On July 6, 2011, the US Environmental Protection Agency (EPA) finalized a rule that protects the health of millions of Americans by helping states reduce air pollution and attain clean air standards. This rule, known as the Cross-State Air Pollution Rule, requires states to significantly improve air quality by reducing power plant emissions that contribute to ozone and/or fine particle pollution in other states.” (In other words, coal is out.)

In the middle of the worst economic times since the Great Depression, when as many as 86 million are unemployed, how can the federal government purposely push for over 1.2 million in additional job losses? And yes, the job situation may be worse than official figures suggest. Readers should review CNN Money’s May 4 piece titled “The 86 million invisible unemployed” which stated that our work force has the “lowest force participation rate since 1981.”

As CNN Money explained, “Only people looking for work are considered officially unemployed.” So the situation is worse than the government represents. Yet the government would add to the number of those out of work by strangling the coal industry. When the price of oil remains high and a war in the Middle East could drive oil prices higher, wouldn’t it be wise to leave the coal industry alone? But then, we have to save the planet from global warming – or do we?

Full article: Coal Industry Under Attack (JR Nyquist | Financial Sense Online)

Entitlement Spending Creates a ‘Nation of Takers’

As the economic crisis worsens, people are increasingly becoming dependent on the hand-outs and work ethic consequently goes downhill in exchange for the enticement of easy money. As a result, the quality of life in families is being eroded as the traditional role of both males and females in the household is increasingly undermined.

What’s more, is that one generation influences the next and at the moment we’re mislead to believe that a cut in crucial military spending will solve a problem it never created. Lets also not forget, as the study points out, how the unborn will shoulder the burden with an insurmountable debt that just cannot be paid back for generations.

Whether by some sort of cynical design or pure ignorance, the family unit — the core of America’s pride and social fabric, is being ripped apart. History shows that once a nation’s pride is destroyed, so goes the nation.

America’s entitlement spending is destroying the economy. But political economist Nicholas Eberstadt isn’t worried about that. In an article published in the Wall Street Journal August 31, Eberstadt argued that the effect entitlement spending is having on the nation’s character is far more dangerous.

He outlines a shocking increase in entitlement spending: 727 percent in the last 50 years. And that’s after adjusting for inflation and the increase in population.

“Within living memory, the federal government has become an entitlements machine,” he wrote. “As a day-to-day operation, it devotes more attention and resources to the public transfer of money, goods and services to individual citizens than to any other objective, spending more than for all other ends combined.”

In a longer version of his Journal essay, published by Templeton Press and available here, Eberstadt meticulously backs up his claims with a wealth of data that even his critics do not dispute.

The shocking facts run against the popular historical narrative. For example, Eberstadt points out that America’s defense spending places a smaller burden on America’s economy now than almost any point in the Cold War. America spends 4.8 percent of its economy on defense. In 1961, when President Dwight Eisenhower warned of a “military-industrial complex,” 9.4 percent of America’s gdp was spent on the military.

In fact, since September 11, it hasn’t been out-of-control military spending inflating America’s debt bomb, but escalating entitlement spending.

Manhood was also directly attacked. “Before the age of entitlements, self-reliance and the work ethic were integral and indispensable elements of the ideal of manliness in America,” he wrote.

“Put simply the arrival of the entitlement society in America has coincided with a historically unprecedented exit from gainful work by adult men,” he continued. And once again, Eberstadt commands a battery of statistics. Most surprisingly, more able-bodied American men shirk work than in almost all of Europe, despite the Continent’s infamy for entitlement spending.

Eberstadt’s numbers also show that America is tolerating widespread cheating. In 1960, 455,000 people received government payments for disability. In 2011, it’s 8.6 million. Nearly half of all these payments go to people suffering “mood disorders” or sicknesses affecting “musculoskeletal system and the connective tissue,” like back pain. These two are almost impossible for doctors to diagnose.

The entitlement system draws millions of people into a lifestyle of lying and cheating. And Eberstadt doesn’t just blame the claimants of the disability pay. The doctors and health care workers that allow this are “collaborators,” as is the U.S. judicial system. American voters and politicians are “willing and often knowing enablers.”

Finally, Eberstadt shows that the system drafts society into the robbery of “a pool of citizens who can offer not resistance to such schemes: the unborn descendants of today’s entitlement-seeking population.”

Full article: Entitlement Spending Creates a ‘Nation of Takers’ (The Trumpet)

7 Reasons This Election Doesn’t Matter

Click the link for the full breakdown on each challenge.

Regardless of who wins the election, America faces some tough decisions.

Challenge 1: Can you conceptualize $1 trillion?

Challenge 2: America’s massive debt

Challenge 3: America’s uncontrollable welfare dependency

Challenge 4: America’s banking system is shot.

Challenge 5: The jobs are gone forever.

Challenge 6: America’s education system is failing.

Challenge 7: The economic cost of America’s moral slide.

Regardless of who America chooses at the ballot box, its moral slide will not be turned. At best, it can be slowed. There are 230-plus years of U.S. history that prove it.

America’s debt, its welfare mentality, its crumbling education system and morals are all the product of America’s collective choices. We are now eating the fruit of those choices. Economic indicators suggest another economic downturn has already started. A greater economic depression is on the way, and there is little that can be done to mitigate it.

America is past the point of no return. America’s past prosperity will not return until the whole economic system has been wiped out. Tough times are coming on America, but once through, the country will be able to start anew.

Full article: 7 Reasons This Election Doesn’t Matter (The Trumpet)

European Federation Will Form By 2016, Says Commissioner

As sure as the sky is blue, The United States of Europe — “Iron mixed with clay” (Daniel 2:43), is coming soon.

Time is short’—the crises will force the EU to act quickly, says EU commissioner for financial services.

The European Union will have merged into a federal superstate by 2016, European commissioner for financial services, Michel Barnier, said in an interview published by the French newspaper Liberation August 2.

“The time is short: By 2016 the EU will have transformed into a federation of European nations in which their fates are merged without erasing their differences,” he said.

“A federation means economic governance, collective management of our budget guidelines, a banking union, industrial policy, and much stronger budget coordination,” he said.

Barnier explained that by becoming a federation, the EU is traveling in a direction forced upon it by the banking crisis. “Europe has done much in a short time to correct deficiencies accumulated over 10 years,” he said, adding: “Now it is moving toward a European federation, because the crisis has shown that we could not go it alone.”

Barnier said the plan to establish a European banking regulator by January 2012 was a step toward this federal union.

Barnier is right: The crisis is forcing Europe to become a federal union. His timescale is greatly accelerated compared to other EU officials who talk about these changes happening over the next 10 years.

But, as Barnier said, “The time is short.” The crisis will force Europe to change urgently.

Barnier is describing a huge change—a new superpower hitting the world scene very shortly. Watch this closely; it will change the world. A federal United States of Europe will be here in just a few years—if it even takes that long.

Full article: European Federation Will Form By 2016, Says Commissioner (The Trumpet)