Never in the history of the NFL has there ever been anything like this. Today, Tim Tebow engineered yet another miraculous 4th quarter comeback. Almost everyone has been expecting this unprecedented string of comebacks to come to an end, yet Tebow just keeps pulling off miracle after miracle. It seems like nearly every week now we are talking about another unbelievable Tim Tebow comeback. It is truly a great story, and what is wonderful about Tebow is that he is not out to glorify himself. He is very humble, he always recognizes his teammates and he is a terrific role model for a generation of American youth that is in desperate need of one. Unfortunately, there is not going to be a similar comeback story for the U.S. economy. It is late in the 4th quarter, we have accumulated over 50 trillion dollars of total debt as a nation, and our economic guts are being ripped out at a rate that is almost impossible to believe. The game is essentially over and we are headed for an incredible amount of economic pain as a nation.
We desperately need a “political Tim Tebow” to come along to dismantle our current debt-based economic system. But instead, the corrupt politicians in Washington D.C. just keep patching up our current system and hope that somehow it will recover.
Unfortunately, this is about as good as things are going to get for the U.S. economy. The federal government and the Federal Reserve are already pushing things to the “red line”, and all of that effort has not accomplished much.
We have been experiencing “economic stagnation” for much of the past year, and there is not much more that they can do to improve things under our current system.
Right now, the Federal Reserve has pushed interest rates as low as they can go. They can’t go any lower.
Right now, the federal government is borrowing and spending unprecedented amounts of money. Federal spending cannot go much higher.
Right now, we have already seen tax cut after tax cut and virtually none of them have been paid for. Any additional tax cuts will just send our budget deficits even higher.
Right now, we have already seen unprecedented intervention by the Federal Reserve. They have done just about everything short of dropping huge bags of money over the countryside from helicopters.
The federal government and the Federal Reserve have done just about everything that they can possibly do to “stimulate” the economy, and yet things just keep getting worse.
So what is going to happen when the federal government and the Federal Reserve quit stimulating the economy?
As I wrote about the other day, when evaluating the future of the U.S. economy, it is vitally important to look at the balance sheet numbers and the long-term trends.
When you do that, you suddenly do not feel so good about the upward “blips” that we have seen in the economy lately.
Yes, the “official” unemployment rate recently went down slightly. But as Mac Slavo recently pointed out, even with the recent “improvement” the truth is that the “real” level of unemployment in the United States is still well over 20 percent.
And all of the long-term trends indicate that we heading for a massive amount of trouble.
The number of good jobs continues to decline. Even though our population is rapidly increasing, there are 10 percent fewer middle income jobs in the U.S. today than there were a decade ago.
In recent years, the employment to population ratio has been steadily declining. At the start of the recession it was at 62.7%. Today, it is at 58.5%.
Household incomes continue to go down as well. Since December 2007, median household income in the United States has declined by a total of 6.8% once you account for inflation.
So why is this happening? Well, as I wrote about recently, the United States has the worst balance of trade in the entire world by far.
Wealth, jobs and economic infrastructure are pouring out of this country and very few politicians are trying to stop it.
An average of 23 manufacturing facilities were shut down every single day in the United States last year.
That represents a huge amount of lost jobs.
So do you hear any political candidates talking about how they are going to stop this from happening or about how they are going to get all of those lost jobs back?
Overall, the U.S. has lost a total of more than 56,000 manufacturing facilities since 2001.
So how can an economy be great when it is constantly bleeding huge amounts of economic infrastructure?
We have become way too dependent on other nations for the things that we need.
How much trouble would we be in if Saudi Arabia suddenly decided to quit shipping us oil or if China suddenly decided to quit shipping us cheap plastic products to sell in our stores?
Right now, businesses are absolutely racing to get out of the United States. Big corporations are shipping as many jobs as they possibly can out of the country. Our insane economic policies have turned American workers into tremendous liabilities.
One economist from Princeton University is warning that 40 million more U.S. jobs could be sent offshore over the next two decades if nothing is done to stop this.
So why aren’t more politicians screaming and yelling about this?
Without good jobs, Americans are falling out of the middle class in staggering numbers.
Since 2007, the number of children living in poverty in the state of California has increased by 30 percent.
So is that a sign that things are getting better or that things are getting worse?
A higher percentage of Americans is living in extreme poverty than has ever been measured before. Not only that, 2.6 million more Americans fell into poverty last year. That was also a new all-time record.
So are those signs that things are getting better or that things are getting worse?
The American people generally do not understand why these things are happening, but they are clearly getting frustrated.
A recent Gallup poll found that an all-time record 76 percent of all Americans believe that most members of Congress do not deserve to be reelected.
But when election time rolls around, they will probably send most of them back to Washington D.C. anyway.
Our politicians keep kicking the can down the road, but time for doing that is running out. The unprecedented “stimulus” efforts by the federal government will be coming to an end sooner or later.
In a recent article, author Bruce Krasting listed a whole bunch of reasons why the economic can is not going to be able to be kicked down the road much farther. The following are some of the things that he says are scheduled to end by the beginning of 2013….
A) The Bush tax cuts on those making more than $200k will expire.
B) The Bush tax cuts on those making less than $200k will also expire.
C) The Patch on AMT will expire.
D) The 2% payroll tax holiday will expire for all workers on 12/31/12 (I’m sure the current holiday will be rolled for another year)
E) The 99-week extended unemployment benefits die on 12/31. (The emergency benefits will also be extended for 2012)
F) There will have to be a budget that is approved. Alternatively, a series of continuing resolutions is required to avert a government shutdown. We have not had an approved budget in over 900 days.
G) 2013 is the first year that there will be mandatory caps on discretionary spending. These limits will result in a YoY decline in government spending.
H) The Federal Reserve has promised to keep interest rates at zero into 2013. While it is possible that the Fed could continue the madness for even longer, the reality is that interest rates have nowhere to go but up.
I) By January 2013 it will be painfully evident that the country’s key social programs, Social Security and Medicare will be running in the red at a pace that is far higher than anyone considered possible. The need for dramatic changes in these programs will have to come onto the table. The implications of this will be significant.
J) In 2013 the issues of Fannie, Freddie, FHA and the Federal Home Loan Banks must be addressed. The problems at the housing agencies has festered too long.
K) The country will face another debt ceiling extension. The last time cost us our AAA.
Sadly, we will probably not have to wait until 2013 to feel a whole lot of economic pain.
The reality is that a 15 trillion dollar debt and trillion dollar yearly budget deficits are not sustainable. We have created a situation where a horrible crash is inevitable, and there is no way that our current debt-based system can be fixed to keep a nightmarish collapse from happening.
During the Obama administration, the U.S. government has accumulated more debt than it did from the time that George Washington took office to the time that Bill Clinton took office. That is a recipe for national financial suicide.
Meanwhile, despite what you may have heard, the European debt crisis has not been fixed.
Not at all.
The truth is that none of the fundamental problems were fixed by this recent “agreement” as Ambrose Evans-Pritchard recently noted in one of his columns….
There is no shared debt issuance, no fiscal transfers, no move to an EU Treasury, no banking licence for the ESM rescue fund, and no change in the mandate of the European Central Bank.
In short, there is no breakthrough of any kind that will convince Asian investors that this monetary union has viable governance or even a future.
Germany has kept the focus exclusively on fiscal deficits even though everybody must understand by now that this crisis was not caused by fiscal deficits (except in the case of Greece). Spain and Ireland were in surplus, and Italy had a primary surplus.
For many more reasons why Europe is headed for big trouble, please read this article: “22 Reasons Why We Could See An Economic Collapse In Europe In 2012“.
When Europe goes down, it is going to have a devastating impact on the United States.
Meanwhile, the economies of China and Japan are also steamrolling toward recession.
There is simply way too much debt in the world, and a great day of reckoning is coming.
Combined, the industrialized nations of the world borrowed more than 10 trillion dollars this year, and that number is expected to soar even higher next year.
Jim Cramer of CNBC stated recently that the global economy is at “DEFCON 3, two stages from a financial collapse so huge it’s hard to get your mind around.”
Most Americans don’t understand this yet. But hopefully we can get more of them educated while there is still time.
The global financial system is a big shell game. It is a gigantic mountain of debt, leverage and risk.
You would have thought that we would have learned some key lessons from the financial crisis of 2008, but we didn’t.
So instead of doing something about the “too big to fail” banks, they are now more “too big to fail” than ever.
As big banks and big corporations have come to dominate our economy more than ever before, wealth and power have also become much more concentrated….
*The wealthiest 1 percent of all Americans now own more than a third of all the wealth in the United States.
*The poorest 50 percent of all Americans collectively own just 2.5% of all the wealth in the United States.
*The six heirs of Wal-Mart founder Sam Walton have a net worth that is roughly equal to the bottom 30 percent of all Americans combined.
*Overall, the wealthiest one percent of all Americans have a greater net worth than the bottom 90 percent combined.
It would be wonderful if we could send a “Tim Tebow of politics” to Washington D.C., but instead the Democrats and the Republicans look like they just plan to give us more of the same.
Newt Gingrich is essentially an older, ruder version of Barack Obama. If you are counting on him to “save America” then you are going to be incredibly disappointed.
While at Florida, Mr. Tebow became well known for spending his summers helping the poor and needy in the Philippines. He also spoke in prisons and appeared to accept every opportunity to volunteer. He encouraged his teammates and classmates to follow his lead.
You can see video of Tim Tebow speaking to a group of prisoners at the Lake City Correctional Facility while he was still attending the University of Florida right here.
Unfortunately, there is no “Tim Tebow comeback” on the horizon for the U.S. economy at this point.
But when the U.S. economy does get worse, we can take a cue from Tim Tebow and be very generous with those in need. There are going to be a lot of people that will be really hurting, and those of us that have been blessed should do what we can to help them out.
A lot of people say that my site is all about “doom and gloom”, but telling the truth to the American people is never a bad thing.
We do not do ourselves any favors by sticking our heads in the sand and pretending that everything is going to be okay.
There is going to be no miracle comeback for the U.S. economy.
A horrific economic collapse is coming.
You better get ready.
Michael Snyder is the editor of The Economic Collapse Blog
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