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Brandon Smith

There are many problems when attempting to track a faltering economy. For one, the people in government generally do not want the public to know when the system is in decline because this looks bad for them. They prefer to rig statistical indicators as much as possible and hope that no one notices. When the crash occurs, they then claim that “no one saw it coming” and the disaster “came out of nowhere”, so how could they be to blame?

I have even heard it argued that political leaders, including the president, have a “duty” to lie about the state of the economy because once they admit to the decline they will cause a panic and perpetuate the crisis. This is stupidity. If an economic system is in disrepair and is built on a faulty foundation, then the problems should be identified and fixed immediately. The weak businesses should be culled, not bailed out. The wasteful government spending should be cut, not increased. The downturn should not be hidden and prolonged for years or decades. In most cases, this only makes the inevitable crash far worse and more damaging.

Another factor, which some people might call “conspiracy theory” – but it has been proven time and time again in history – is that the money elites have a tendency to engineer economic disasters while deliberately hiding the real statistics from the public. Why? Well, if the real data was widely disseminated, then a crash would not be much of a surprise and the populace could be prepared for it. I suspect the elites hide the data because they WANT the crash to be a surprise. The bigger the shock, the bigger the psychological effect on the masses. This fear and confusion allows them to make changes in the power structure of a nation or of the entire world that they would not be able to accomplish otherwise.

The most rigged statistics tend to be the least important overall in analysis, but this does not stop the mainstream media and investors from hyper focusing on them. How many times have you told friends and family about the collapse in manufacturing or the explosion in consumer and corporate debt, only to hear them say, “But the stock market is at all-time highs!” Yes, even though stock markets are a meaningless trailing indicator, even though GDP stats are a complete fallacy, and even though jobless numbers do not include tens of millions of people out of work, these are the stats that the average person takes mental note of when consuming their standard 15 minutes of news per day.

While the issue of rigged statistics makes analysis of a crash difficult, a willfully ignorant citizenry makes reporting on the real data almost impossible. It’s sad to say, but a large number of people do not want to hear about negative information. They want to believe that all is well, and will delude themselves with fantasies of blind optimism and endless summers. Like the tale of “The Ant And The Grasshopper”, they are grasshoppers and they see anyone who focuses on the negative as “chicken littles” and “doom mongers”. In their minds they have all the time in the world, until they freeze and starve when winter comes.

When I encounter people who actually believe the manipulated numbers or buy into the stock market farce or simply don’t want to accept that a crash could happen in their lifetime, I always ask them to consider these questions: [i]If the global economy is not on the verge of collapse, then why did central banks keep propping it up for the past ten years? And if central banks have been propping up the system, how much longer do you think they can do this? How much longer do you think they want to do it? What if one day they decide to let the entire house of cards tumble? What if such an event actually benefits them?

We’ve seen that a broken economy can be technically held together for a decade, but under the surface, the structure continues to rot. The bottom line is that even if the elites wanted to keep the system going for another ten years, and even if politicians continued to help them by pumping out false statistics, there is no way to hide the effects of crumbling fundamentals. We saw this during the crash of 2008, and now we’re seeing it again.

After nearly ten years of stimulus inflated the largest financial bubble in history (the Everything Bubble), the Federal Reserve and other central banks halted stimulus measures and tightened global liquidity. By the end of 2018, a new crash began, the implosion of the Everything Bubble had been triggered. All of this is still just an extension of the crash of 2008, which never really subsided; it was only slowed down through tens of trillions of dollars in central bank intervention. Now, the central banks have started an avalanche that cannot be stopped. But the fact of the matter is, they don’t really want to stop it.

Here are the indicators so far that prove a crash is happening in the U.S. while a majority of the public is oblivious:

GDP numbers are completely manipulated. Government spending of taxpayer dollars on a number of inflated programs, including continued spending on Obamacare, is added to GDP calculations. Without this fancy accounting, U.S. GDP growth would actually be negative, according to ShadowStats. But even with the juiced data, official GDP growth is still in decline, falling to 1.9% and well below the 3% growth we were supposed to see this year.

Official unemployment stats remain at all-time lows, which is commonly cited by the mainstream media, Donald Trump (he used to argue the opposite three years ago), and even the Federal Reserve in reference to the health and stability of the economy. What they do not mention much is the 95 million people not in the labor force and not counted because they have been unemployed for so long. When the media does mention this fact, they claim the number is “misleading”, that most of these people are students or retired, that the retirement age is decreasing and Baby Boomers are leaving the workforce sooner, and that the people who don’t have jobs are simply “not interested” in working. None of this is true.

The retirement age is increasing in the U.S., not decreasing, according the SS Administration. Current average retirement age is now 67, up from 65, almost the same as it was during the Great Depression. Baby Boomers are not retiring at rates similar to ten years ago, and are in fact attempting to stay in the workforce due to the poor economy. Many of them are trying to come OUT of retirement just to make ends meet.

The labor participation rate remains near record lows. Interestingly, the Bureau of Labor Statistics (BLS) house survey that is used to determine if people “want a job” assumes that if you are near retirement age and do not have a job, you are simply not interested in a job, and they count you as “non-participating”. However, if you DO have a job and you are near retirement age, they count you as participating. It’s a rather convenient assumption on the government’s part to claim that just because an unemployed person is near retirement age, that means they “don’t want a job”.

While there is surely a small percentage of the 95 million people not counted in the labor force that do not want a job, if unemployment stats counted U-6 measurements as they used to, the unemployment rate would be closer to 20%.

Another problem is the quality of jobs being created. U.S. manufacturing jobs, as well as higher wage jobs, are in steep decline. They have been replaced with low paying jobs in the service sector.

Real wages in the U.S. have not kept up with inflation. The average worker is now losing money overall as prices rise beyond the pace of their incomes.

As more and more Millennials say they cannot afford to buy a home, rental prices have skyrocketed in the past several years. The home ownership rate plunged starting in 2006 and has not recovered since.

U.S. manufacturing has fallen to levels not seen since the crash of 2008. U.S. factory orders have slumped in 2019.

U.S. Services PMI continues to falter since spring of this year. Job growth is now slowing and over 8,500 retail stores have been closed down already in 2019. Web-based retail is not picking up the slack, as online sellers like Amazon are suffering from falling profits.

Corporate profits overall have tumbled this year and projected future profits have been drastically adjusted to the downside.

Corporate debt, consumer debt and national debt are all at historic highs. Corporate cash flow is so tight that Federal Reserve repo purchases continue to run into high demand. This debt signal is one we saw in 2007, just before the credit crisis.

U.S. trucking and railroad freight continue to log steep declines in traffic and goods. This tells us what we already know: Even though consumer spending has increased recently, this does not mean people are buying more stuff or have more disposable income. What is really happening is inflation, or stagflation. Cost of living is going up. Debt payments are going up. Consumers are spending more on the same amount of stuff, or less stuff, and have less expendable income. U.S. consumers are being bled dry.

All of these factors and more show an economy in recession or depression (depending on what historic standards you use). In the darker corners of the investment world, the great hope is that the central banks will return to pumping trillions into the banking sector ($16 trillion during the TARP bailout dwarfs the $250 billion the Fed has recently pumped out in their repo markets). They hope that this will free up even more credit. Meaning, they believe only more debt will save the system from suffering.

I say, time is up on the debt party. More stimulus will not stall the crash that is already happening, and the Fed does not appear poised to print anywhere near what it did during the credit crisis, at least not in time to change the trend. The can has been kicked for the last time. The grasshopper mentality will not save people from the clear reality. Only preparation and planning will.

Medea Benjamin and Nicolas J. S. Davies

November 16, 2019 "Information Clearing House" -    

The waves of protests breaking out in country after country around the world beg the question: Why aren’t Americans rising up in peaceful protest like our neighbors? We live at the very heart of this neoliberal system that is force-feeding the systemic injustice and inequality of 19th-century laissez-faire capitalism to the people of the 21st century. So we are subject to many of the same abuses that have fueled mass protest movements in other countries, including high rents, stagnant wages, cradle-to-grave debt, ever-rising economic inequality, privatized health care, a shredded social safety net, abysmal public transportation, systemic political corruption and endless war.

We also have a corrupt, racist billionaire as president, who Congress may soon impeach, but where are the masses outside the White House, banging pots and pans to drive Trump out? Why aren’t people crashing the offices of their congresspeople, demanding that they represent the people or resign? If none of these conditions has so far provoked a new American revolution, what will it take to trigger one?

In the 1960s and 1970s, the senseless Vietnam War provoked a serious, well-organized antiwar movement. But today the U.S.’s endless wars just rage on in the background of our lives, as the U.S. and its allies kill and mutilate men, women and children in distant countries, day after day, year after year. Our history has also witnessed inspiring mass movements for civil rights, women’s rights and gay rights, but these movements are much tamer today.

The Occupy Movement in 2011 came closest to challenging the entire neoliberal system. It awakened a new generation to the reality of government of, by, and for the corrupt 1 percent, and built a powerful basis for solidarity among the marginalized 99 percent. But Occupy lost momentum because it failed to transition from a rallying point and a decentralized, democratic forum to a cohesive movement that could impact the existing power structure.

The climate movement is starting to mobilize a new generation, and groups like School Strike for the Climate and Extinction Rebellion take direct aim at this destructive economic system that prioritizes corporate growth and profits over the very survival of life on Earth. But while climate protests have shut down parts of London and other cities around the world, the scale of climate protests in the U.S. does not yet match the urgency of the crisis.

So why is the American public so passive?

Americans pour their energy and hopes into electoral campaigns. Election campaigns in most countries last only a few months, with strict limits on financing and advertising to try to ensure fair elections. But Americans pour millions of hours and billions of dollars into multi-year election campaigns run by an ever-growing sector of the commercial advertising industry, which even awarded Barack Obama its “Marketer of the Year” award for 2008. (The other finalists were not John McCain or the Republicans but Apple, Nike and Coors beer.)

When U.S. elections are finally over, thousands of exhausted volunteers sweep up the bunting and go home, believing their work is done. While electoral politics should be a vehicle for change, this neoliberal model of corporate “center-right” and “center-left” politics ensures that congresspeople and presidents of both parties are primarily accountable to the ruling 1 percent who “pay to play.”  Former President Jimmy Carter has bluntly described what Americans euphemistically call “campaign finance” as a system of legalized bribery. Transparency International (TI) ranks the U.S. 22nd on its political corruption index, identifying it as more corrupt than any other wealthy, developed country.

Without a mass movement continually pushing and prodding for real change and holding politicians accountable—for their policies as well as their words—our neoliberal rulers assume that they can safely ignore the concerns and interests of ordinary people as they make the critical decisions that shape the world we live in. As Frederick Douglass observed in 1857, “Power concedes nothing without a demand. It never did and it never will.”

Millions of Americans have internalized the myth of the “American dream,” believing they have exceptional chances for social and economic mobility compared with their peers in other countries. If they aren’t successful, it must be their own fault—either they’re not smart enough or they don’t work hard enough.

The American Dream is not just elusive—it’s a complete fantasy. In reality, the U.S. has the greatest income inequality of any wealthy, developed country. Of the 39 developed countries in the Organization for Economic Co-operation and Development (OECD), only South Africa and Costa Rica exceed the U.S.’s 18 percent poverty rate. The United States is an anomaly: a very wealthy country suffering from exceptional poverty. To make matters worse, children born into poor families in the U.S. are more likely to remain poor as adults than poor children in other wealthy countries. But the American dream ideology keeps people struggling and competing to improve their lives on a strictly individual basis, instead of demanding a fairer society and the health care, education and public services we all need and deserve.

The corporate media keeps Americans uninformed and docile. The U.S.’s corporate media system is also unique, both in its consolidated corporate ownership and in its limited news coverage, endlessly downsized newsrooms and narrow range of viewpoints. Its economics reporting reflects the interests of its corporate owners and advertisers; its domestic reporting and debate are strictly framed and limited by the prevailing rhetoric of Democratic and Republican leaders; its anemic foreign policy coverage is editorially dictated by the State Department and Pentagon.

This closed media system wraps the public in a cocoon of myths, euphemisms and propaganda to leave us exceptionally ignorant about our own country and the world we live in. Reporters Without Borders ranks the U.S. 48th out of 180 countries on its Press Freedom Index, once again making the U.S. an exceptional outlier among wealthy countries.

It’s true that people can search for their own truth on social media to counter the corporate babble, but social media is itself a distraction. People spend countless hours on Facebook, Twitter, Instagram and other platforms venting their anger and frustration without getting up off the couch to actually do something—except perhaps sign a petition. “Clicktivism” will not change the world.

Add to this the endless distractions of Hollywood, video games, sports and consumerism, and the exhaustion that comes with working several jobs to make ends meet. The resulting political passivity of Americans is not some strange accident of American culture but the intended product of a mutually reinforcing web of economic, political and media systems that keep the American public confused, distracted and convinced of our own powerlessness.

The political docility of the American public does not mean that Americans are happy with the way things are, and the unique challenges this induced docility poses for American political activists and organizers surely cannot be more daunting than the life-threatening repression faced by activists in Chile, Haiti or Iraq.

So how can we liberate ourselves from our assigned roles as passive spectators and mindless cheerleaders for a venal ruling class that is laughing all the way to the bank and through the halls of power as it grabs ever more concentrated wealth and power at our expense?

Few expected a year ago that 2019 would be a year of global uprising against the neoliberal economic and political system that has dominated the world for 40 years. Few predicted new revolutions in Chile or Iraq or Algeria. But popular uprisings have a way of confounding conventional wisdom.

The catalysts for each of these uprisings have also been surprising. The protests in Chile began over an increase in subway fares. In Lebanon, the spark was a proposed tax on WhatsApp and other social media accounts. Hikes in fuel tax triggered the yellow vest protests in France, while the ending of fuel subsidies was a catalyst in both Ecuador and Sudan.

The common factor in all these movements is the outrage of ordinary people at systems and laws that reward corruption, oligarchy and plutocracy at the expense of their own quality of life. In each country, these catalysts were the final straws that broke the camel’s back, but once people were in the street, protests quickly turned into more general uprisings demanding the resignation of leaders and governments.

They have the guns but we have the numbers. State repression and violence have only fueled greater popular demands for more fundamental change, and millions of protesters in country after country have remained committed to non-violence and peaceful protest—in stark contrast to the rampant violence of the right-wing coup in Bolivia.

While these uprisings seem spontaneous, in every country where ordinary people have risen up in 2019, activists have been working for years to build the movements that eventually brought large numbers of people onto the streets and into the headlines. Erica Chenoweth’s research on the history of nonviolent protest movements found that whenever at least 3.5 percent of a population have taken to the streets to demand political change, governments have been unable to resist their demands. Here in the U.S., Transparency International found that the number of Americans who see “direct action,” including street protests, as the antidote to our corrupt political system has risen from 17 percent to 25 percent since Trump took office, far more than Chenoweth’s 3.5 percent. Only 28 percent still see simply “voting for a clean candidate” as the answer. So maybe we are just waiting for the right catalyst to strike a chord with the American public.

In fact, the work of progressive activists in the U.S. is already upsetting the neoliberal status quo. Without the movement-building work of thousands of Americans, Bernie Sanders would still be a little-known senator from Vermont, largely ignored by the corporate media and the Democratic Party. Sanders’ wildly successful first presidential campaign in 2016 pushed a new generation of American politicians to commit to real policy solutions to real problems instead of the vague promises and applause lines that serve as smokescreens for the corrupt agendas of neoliberal politicians like Trump and Biden.

We can’t predict exactly what catalyst will trigger a mass movement in the U.S. like the ones we are seeing overseas, but with more and more Americans, especially young people, demanding an alternative to a system that doesn’t serve their needs, the tinder for a revolutionary movement is everywhere. We just have to keep kicking up sparks until one catches fire.







After suffering the worst stock market crash since 1987, the US Federal Reserve has announced a $1.5 trillion injection to ease strained capital markets. It is the biggest action by the Fed since the 2008 financial crisis.

RT’s Boom Bust is joined by the CEO of Euro Pacific Capital Peter Schiff to find out if the Fed’s actions are enough to stop the stock market bloodbath.

“The bull market is clearly over, just look at the numbers,” says the veteran stock broker.
“This is the beginning of the greatest financial crisis in US history,” Schiff says, adding “The financial crisis of US of 2008 will pale in comparison as with the severity of this recession. We are going to have a much greater recession than the one that we had in 2008.”

According to the expert, the difference is that “this one is actually going to have inflation; we are going to have rising consumer prices and a falling dollar which is going to make it so much worse than what we have experienced 10-12 years ago.”  Schiff explains that the coronavirus is just a pin while the debt bubble is the problem. The virus has not only pricked the stock market bubble and the crypto bubble, but it has also punctured the bond market bubble. “So, now we have to deal with the consequences of the disease that the Fed inflicted us with. And unfortunately the Fed’s cure for the coronavirus is going to be fatal for the economy.”  The strategist says that the fiscal stimulus is going to make the situation worse.  “The US is broke, there is no money to stimulate the economy, and all we can do is print money… The bond market is imploding because there is too much debt.”

Norman Lewis

As economists begin to predict what the global economic effects of Covid-19 will be, the danger is we play up the economic damage of the virus while hiding the deep-rooted sources of our contemporary financial doldrums.
It is inevitable that economic forecasts of the impact of Covid-19 on the global economy are being revised daily, if not hourly. It is right that economic forecasters should be updating their predictions. But we all need to keep in mind that these revised forecasts are little more than guesswork – however sophisticated their computer modelling might be.

This is not prejudice against economists, the experts Michael Gove in particular referred to when he said during the Brexit referendum that the British people had had enough of them –referring specifically to their shaky prediction track record. Economic predictions and forecasting are notoriously difficult. It is the reason why leading economist JK Galbraith once quipped that the only function of economists was “to make astrology look respectable.”  We are going to see a proliferation of astrology in the days ahead. The biggest danger is going to be the battle to avoid economic alarmism.

The division of labour between health officials and economic experts is increasingly being blurred. Health officials are being asked about economic impacts, while economists are being called to make predictions about the impact of the disease. Health and economics are being conflated, which is confusing for all; what should be treated as a medical emergency is increasingly becoming a sphere for urgent government economic bailouts and politics aimed at alleviating the fall-out of lockdowns.

These confusions aside, predicting the economic costs of ill-health is very difficult. The Co-Operative Pharmacy reported in 2010, for example, that flu cost UK employers 7.6 million working days this year. It estimated that the cost to the economy was around £1.35 billion. But no-one even really knows the economic costs of these ‘normal’ diseases. Annual deaths precipitated by influenza are much higher than the deaths from coronavirus so far. According to Public Health England, in an average year about17,000 people in England die from flu complications, of which around four-fifths are over 65. But the numbers vary wildly from one year to the next. The relative effects on British gross domestic product (GDP) of a high flu death year compared to a low death year might keep economic modellers busy, but the actual effect gets lost in the longer-term influences and trends.
But there are things we know which should be at the forefront of our considerations. The world economy was already in deep ill-health before anyone had even heard of Covid-19. Losing sight of this means the remedies on offer might be good at stemming the symptoms of a problem, but they ignore the underlying cause, the real source of the malaise, which will remain untreated. This will be worse in the long run than any short-term dislocations we are forced to endure.

The world economy has been, if not on life-support, terminally ill for years. Global growth – and especially advanced-economy growth – this year was already dismal, and has been for many years. Forecasts for this year were already pretty downbeat before most people were aware of the word ‘coronavirus’. The illness is the result of years of diminishing business investment in new technologies and ways of operating, and the propping up by governments of companies that should have gone out of business. The end result? Almost stagnant productivity. People at work are no longer producing more in the same time. This is a significant break from the dominant pattern during the past two centuries of economic expansion. This waning in productivity growth – sinking to little more than flatlining in Britain – is what accounts for most people no longer benefiting from regular increases in living standards.

It is also what has led to the increased dependence on debt and financialisaton. The 2008 crash confirmed the fragility of economic systems that rely too much on borrowing and too little on creating new wealth. We are not in permanent recession, but we are stuck in a cycle of financial crises. Between the crashes, debt keeps things ticking along. The unstable dissonance between the financial and productive economies – reflected in the inflated stock markers – reveal that an adjustment was inevitable. The dramatic falls in global stock markets over the past two weeks were on the cards before the impact of Covid-19 panic set in.

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