Monday, March 4, 2013

12 Things That Just Happened That Show The Next Wave Of The Economic Collapse Is Almost Here


Are we running out of time?  For the last several years, we have been living in a false bubble of hope that has been fueled by massive amounts of debt and bailout money.  This illusion of economic stability has convinced most people that the great economic crisis of 2008 was just an "aberration" and that now things are back to normal.  Unfortunately, that is not the case at all.  The truth is that the financial crash of 2008 was just the first wave of our economic troubles.  We have not even come close to recovering from that wave, and the next wave of the economic collapse is rapidly approaching.  Our economy is like a giant sand castle that has been built on a foundation of debt and toilet paper currency.  As each wave of the crisis hits us, the solutions that our leaders will present to us will involve even more debt and even more money printing.  And each time, those "solutions" will only make our problems even worse.  Right now, events are unfolding in Europe and in the United States that are pushing us toward the next major crisis moment.  I sincerely hope that we have some more time before the next crisis overwhelms us, but as you will see, time is rapidly running out. The following are 12 things that just happened that show the next wave of the economic collapse is almost here...

#1 According to TrimTab's CEO Charles Biderman, corporate insider purchases of stock have hit an all-time low, and the ratio of corporate insider selling to corporate insider buying has now reached an astounding 50 to 1....

While retail is being told to buy-buy-buy, Biderman exclaims that "insiders at U.S. companies have bought the least amount of shares in any one month," and that the ratio of insider selling to buying is now 50-to-1 - a monthly record.
#2 On Friday we learned that personal income in the United States experienced its largest one month decline in 20 years...

Personal income decreased by $505.5 billion in January, or 3.6%, compared to December (on a seasonally adjusted and annualized basis). That's the most dramatic decline since January 1993, according to the Commerce Department.
#3 In a stunning move, Michigan Governor Rick Snyder says that he will appoint an emergency financial manager to take care of Detroit's financial affairs...

Snyder, 54, took a step he avoided a year ago, empowering an emergency financial manager who can sweep aside union contracts, sell municipal assets, restructure services and reorder finances. He announced the move yesterday at a public meeting in Detroit.
If this does not work, Detroit will almost certainly have to declare bankruptcy.  If that happens, it will be the largest municipal bankruptcy in U.S. history.

#4 On Friday it was announced that the unemployment rate in Italy had risen to 11.7 percent.  That was a huge jump from 11.3 percent the previous month, and Italy now has the highest unemployment rate that it has experienced in 21 years.

#5 The youth unemployment rate in Italy has risen to a new all-time record high of 38.7 percent.

#6 On Friday it was announced that the unemployment rate in the eurozone as a whole had just hit a brand new record high of 11.9 percent.

#7 On Friday it was announced that the unemployment rate in Greece has now reached 27 percent, and it is being projected that it will reach 30 percent by the end of the year.

#8 The youth unemployment rate in Greece is now an almost unbelievable 59.4 percent.

#9 On Saturday, hundreds of thousands of protesters filled the streets of Lisbon and other Portuguese cities to protest the austerity measures that are being imposed upon them.  It was reportedly the largest protest in the history of Portugal.

#10 According to Goldman Sachs, bank deposits declined all over Europe during the month of January.

#11 Over the weekend, the deputy governor of China's central bank declared that China is prepared for a "currency war"...

A top Chinese banker said Beijing is "fully prepared" for a currency war as he urged the world to abide by a consensus reached by the G20 to avert confrontation, state media reported on Saturday.

Yi Gang, deputy governor of China's central bank, issued the call after G20 finance ministers last month moved to calm fears of a looming war on the currency markets at a meeting in Moscow.

Those fears have largely been fuelled by the recent steep decline in the Japanese yen, which critics have accused Tokyo of manipulating to give its manufacturers a competitive edge in key export markets over Asian rivals.
#12 Italy is an economic basket case at this point, and the political gridlock in Italy is certainly not helping matters.  Former comedian Beppe Grillo's party could potentially tip the balance of power one way or the other in Italy, and over the weekend he made some comments that are really shaking things up over in Europe.  For one thing, he is suggesting that Italy should hold a referendum on the euro...

"I am a strong advocate of Europe. I am in favor of an online referendum on the euro," Beppe Grillo told Bild am Sonntag.

Such a vote would not be legally binding in Italy, where referendums can only be used to repeal laws or parts of laws, but would carry political weight. Grillo has said in the past that membership of the euro should be up to the Italian people.
In addition, Grillo is also suggesting that Italy's debt has gotten so large that renegotiation is the only option...

In an interview with a German magazine published on Saturday, Mr Grillo said that “if conditions do not change” Italy “will want” to leave the euro and return to its former national currency.
The 64-year-old comic-turned-political activist also said Italy needs to renegotiate its €2 trillion debt.

At 127 per cent of gross domestic product (GDP), it is the highest in the euro zone after Greece.

“Right now we are being crushed, not by the euro, but by our debt. When the interest payments reach €100 billion a year, we’re dead. There’s no alternative,” he told Focus, a weekly news magazine.

He said Italy was in such dire economic straits that “in six months, we will no longer be able to pay pensions and the wages of public employees.”
And of course government debt has taken center stage in the United States as well.

The sequester cuts have now gone into effect, and they will definitely have an effect on the U.S. economy.  Of course that effect will not be nearly as dramatic as many Democrats are suggesting, but without a doubt those cuts will cause the U.S. economy to slow down a bit.

And of course the U.S. economy has already been showing plenty of signs of slowing down lately.  If you doubt this, please see my previous article entitled "Consumer Spending Drought: 16 Signs That The Middle Class Is Running Out Of Money".

So what comes next?

Well, everyone should keep watching Europe very closely, and it will also be important to keep an eye on Wall Street.  There are a whole bunch of indications that the stock market is at or near a peak.  For example, just check out what one prominent stock market analyst recently had to say...

"Every reliable technical tool is warning of major peaking action," said Walter Zimmerman, the senior technical analyst at United-ICAP. "This includes sentiment, momentum, classical chart patterns, and Elliott wave analysis.

"Most of the rally in the stock market since 2009 can be chalked up to the Federal Reserve’s attempt to create a ‘wealth effect’ through higher stock market prices. This only exacerbates the downside risk. Why? The stock market no is longer a lead indicator for the economy. It is instead reflecting  Fed manipulation. Pushing the stock market higher while the real economy languishes has resulted in another bubble.

"The next leg down will not be a partial correction of the advance since the 2009 lows. It will be another major financial crisis. The worst is yet to come."
Sadly, most people will continue to deny that anything is wrong until it is far too late.

Many areas of Europe are already experiencing economic depression, and it is only a matter of time before the U.S. follows suit.

Time is running out, and I hope that you are getting ready.

Feds Say Man Deserved Arrest Because Jacket Said 'Occupy Everything'


A Florida man deserved to be arrested inside the Supreme Court building last year for wearing a jacket painted with “Occupy Everything,” and is lucky he was only apprehended on unlawful entry charges, the Department of Justice says.

The President Barack Obama administration made that assertion in a legal filing in response to a lawsuit brought by Fitzgerald Scott, who is seeking $1 million in damages for his January 2012 arrest inside the Supreme Court building. He also wants his arrest record expunged.

What’s more, the authorities said the former Marine’s claim that he was protected by the First Amendment bolsters the government’s position (.pdf) because the Supreme Court building’s public interior is a First Amendment-free zone.

Fitzgerald was not disturbing anybody, but was repeatedly told by court staff to leave the building or remove the coat. Outside the building, about a dozen “Occupy” protesters were arrested.

Inside, Fitzgerald was handcuffed and arrested for unlawful entry as he was viewing an exhibit on slavery.

Here is the District of Columbia’s ‘unlawful entry’ statute:

Any person who, without lawful authority, shall enter, or attempt to enter, any public building, or other property, or part of such building, or other property, against the will of the lawful occupant or of the person lawfully in charge thereof or his or her agent, or being therein or thereon, without lawful authority to remain therein or thereon shall refuse to quit the same on the demand of the lawful occupant, or of the person lawfully in charge thereof or his or her agent, shall be deemed guilty of a misdemeanor, and on conviction thereof shall be punished by a fine of not more than $1,000, imprisonment for not more than 6 months, or both.
Prosecutors eventually dismissed the charges, and he sued. (.pdf)

To be sure, the courts have upheld convictions of those wearing inappropriate clothing inside the high court’s building — once in 2011 for individuals wearing orange shirts that said “Shut Down Guantanamo” and in 2007 for protesters wearing orange jump suits and black hoods — all in violation of the so-called “Display Clause.”

The Obama administration said Wednesday that Scott could also have been arrested and charged with violating the Display Clause, which makes it “unlawful to parade, stand, or move in processions or assemblages in the Supreme Court Building or grounds, or to display in the Building and grounds a flag, banner, or device designed or adapted to bring into public notice a party, organization, or movement.”

“It also bears noting that, while plaintiff was initially charged with violating the unlawful entry statute, his conduct also violated the Display Clause of section 6135, and he could just as easily have been charged with an independent violation of that statute as well,” the Obama administration said.

CISPA 2.0: Say Goodbye to Our Constitutional Rights


The unrelenting attack on our civil liberties and our privacy continues. Last year we managed to survive an onslaught of legislation that would have destroyed entrepreneurship and free enterprise on the Internet, and our ability to define how we share music, art and information in general.

First there was the Stop Online Piracy Act and the Protect IP Act, or SOPA and PIPA, respectively: two pieces of legislation geared at protecting the copyrights of monopolistic media companies and taking drastic measures to enforce them, like shutting down websites that allow the sharing of this copyrighted material for free. The New Zealand police raid of the house of Kim Dotcom, founder of Megaupload, and the site's subsequent shutdown by the FBI provided a glimpse of what lies ahead if laws like these are passed.

The Anti-Counterfeiting Trade Agreement, or ACTA, took measures a step further by allowing governments to monitor the Internet to enforce copyright law and supposed intellectual property rights. Tens of thousands of Europeans mobilized in response, telling businesses and politicians that companies could not intrude on fundamental human rights, or morph and twist the law to enforce their hand-picked business model.

But despite resounding political opposition in the U.S. and worldwide to Internet censorship and infringements on freedom of speech and privacy, our callous and out-of-touch politicians managed to craft an even scarier piece of legislation: CISPA.

The Cyber Intelligence Sharing and Protection Act passed in April of 2012 in the House by a vote of 248 to 168, but stalled in the Senate because of a disagreement over privacy concerns. At the time, the White House threatened to veto the law because Obama’s advisers raised additional privacy concerns, chief among them Howard Schmidt, who resigned suddenly last May after the bill’s introduction. Schmidt also helped author statements against SOPA and PIPA.

But lo and behold, the two principal authors of the CISPA bill, Sen. Dutch Ruppersberger (R-Maryland), re-introduced the same exact bill several weeks ago on February 12 – presumably in response to recent so-called cyber-attacks from China and security breaches by the hacktivist group Anonymous, whose non-violent actions are a direct response to government's malfeasance and abuse of online authority.

The provisions stipulated in the CISPA legislation are intimidating and far-reaching. Although CISPA does not require private companies to share information with the government, it opens the floodgates for an unprecedented and endless funneling of private communication information to federal military intelligence agencies such as the NSA and the FBI. The only justification for a company to share information with the government is broadly and vaguely defined by a single term: “cybersecurity.”

Additionally, CISPA would override current privacy law such as the Wiretap Act and the Stored Communications Act; in fact, it grants companies complete immunity from judicial oversight and prosecution for the violation of privacy. Under CISPA, information provided to the government would be exempt from FOIA requests.

Furthermore, CISPA does not require companies to notify the individuals from whom they’re collecting data or information – which makes its section about the ability to form a lawsuit against the government little more than a formality.

“If [this bill is] passed,” claims Namecheap, a domain service opposing CISPA, “the U.S. government gains the power to ask your ISP about any/all of your online activities and personal information. Advocated under the premise of anti-terrorism legislation, this legislation is so broad that it threatens to endanger the privacy of every individual and ordinary and law abiding citizens.

"This act makes your private online activity now public, giving ISPs the right to share your personal information completely without your knowledge, due process, or authorization.”

The same day that CISPA was reintroduced, President Obama signed an executive order that deals specifically with information sharing by the owners and operators of CI, or critical infrastructure, such as the banking, communication, transportation and utility industries.

It would not require the passing along of our private information to the government. Additionally, the executive order focuses on the government's sharing of information that it can already legally collect with the CI companies - instead of its rights to gather new information from private ISPs, as stipulated in CISPA.

Part of the reason SOPA and PIPA were booted from Congress was the overwhelming citizen mobilization against it, but also because companies like Google, Firefox, Tumblr, Twitter, Wikipedia and other giant Internet businesses realized the legislation would devastate their enterprises.

Unfortunately, this time around, we won't have these companies fighting on our side because CISPA grants them immunity from lawsuits and has provided them with enough assurance that it will not affect their business in any significant way.

The drafting and introduction of SOPA, PIPA, ACTA and CISPA are all examples of our elected leaders' growing disregard for citizens' fundamental privacy rights, Constitutional rights and free speech rights as manifested in the digital world. Essentially, this legislation provides the formality our government needs to legitimize and legalize what it is either currently doing or what it wants to do. Just look at the NSA, which is already performing extensive and unprecedented data-mining on U.S. citizens in flagrant violation of the Fourth Amendment – but using only vague legislation to justify it.

Passing CISPA will be a significant step in America's already far-progressed trudge towards a police state -- and will, more specifically, encourage already-compliant businesses to provide our personal information to our government as if those two enshrined words did not exist: Constitutional rights.

Are Big Banks a Bunch of Organized Criminal Conspiracies?

The record of deceit and deception that has surfaced in just the past two months points to yes.


Are too-big-to-fail banks organized criminal conspiracies? And if so, shouldn't we seize their assets, just like we do to drug cartels?

Let's examine their sorry record of deceit and deception that has surfaced in just the past two months:

Loan Sharking

You want to get really, really pissed off? Then read "Major Banks Aid in Payday Loans Banned by States [3]" by Jessica Silver-Greenberg in the New York Times (2/23/13). In sickening detail, she describes how the largest banks in the United States are facilitating modern loansharking by working with Internet payday loan companies to escape anti-loansharking state laws. These payday firms extract enormous interest rates that often run over 500 percent a year. (Fifteen states prohibit payday loans entirely, and all states have usury limits ranging from 8 to 24 percent. See the list [4].)

The big banks, however, don't make the loans. They hide behind the scenes to facilitate the transactions through automatic withdrawals from the victim's bank account to the loansharking payday companies. Without those services from the big banks, these Internet loansharks could not operate.

Enabling the payday loansharks to evade the law is bad enough. But even more deplorable is why the big banks are involved in the first place.

For the banks, it can be a lucrative partnership. At first blush, processing automatic withdrawals hardly seems like a source of profit. But many customers are already on shaky financial footing. The withdrawals often set off a cascade of fees from problems like overdrafts. Roughly 27 percent [5]of payday loan borrowers say that the loans caused them to overdraw their accounts, according to a report released this month by the Pew Charitable Trusts. That fee income is coveted, given that financial regulations [6] limiting fees on debit and credit cards have cost banks billions of dollars.
Take a deep breath and consider what this means. Banks like JPMorgan Chase provide the banking services that allow Internet payday loansharks to exist in the first place, with the sole purpose of breaking the state laws against usury. Then Chase vultures the victims, who are often low-wage earners struggling to make ends meet, by extracting late fees from the victims' accounts. So impoverished single moms, for example, who needed to borrow money to make the rent, get worked over twice: First they get a loan at an interest rate that would make Tony Soprano blush. Then they get nailed with overdraft fees by their loansharking bank.

For Subrina Baptiste, 33, an educational assistant in Brooklyn, the overdraft fees levied by Chase cannibalized her child support income. She said she applied for a $400 loan from Loanshoponline.com [7] and a $700 loan from Advancemetoday.com [8] in 2011. The loans, with annual interest rates of 730 percent and 584 percent respectively, skirt New York law.

Ms. Baptiste said she asked Chase to revoke the automatic withdrawals in October 2011, but was told that she had to ask the lenders instead. In one month, her bank records show, the lenders tried to take money from her account at least six times. Chase charged her $812 in fees and deducted over $600 from her child-support payments to cover them.
Let's be clear: JPMorgan Chase, the big bank that supposedly is run oh-so-well by Obama's favorite banker, Jamie Dimon, is aiding, abetting and profiting from screwing loanshark victims.

What possible justification could anyone at Chase have for being involved in this slimy business? The answer is simple: profit. Dimon and company can't help themselves. They see a dollar in someone else's pocket, even a poor struggling single mom, and they figure out how to put it in their own. Of course, everyone at the top will play dumb, order an investigation and then if necessary, dump some lower-level schlep. More than likely, various government agencies will ask the bank to pay a fine, which will come from the corporate kitty, not the pockets of bank executives. And the banks will promise -- cross their hearts -- never again to commit that precise scam again.

(Update: After the publication of Jessica Silver-Greenberg's devastating article, Jamie Dimon "vowed on Tuesday to change how the bank deals with Internet-based payday lenders that automatically withdraw payments from borrowers’ checking accounts," according to the New York Times [9]. Dimon called the practices "terrible." In a statement, the bank said, it was “taking a thorough look at all of our policies related to these issues and plan to make meaningful changes.”)

Money Laundering for the Mexican Drug Cartels and Rogue Nations

HSBC, the giant British-based bank with a large American subsidiary, agreed on Dec. 11, 2012 to pay $1.9 billion in fines for laundering $881 million for Mexico's Sinaloa cartel and Colombia's Norte del Valle cartel. The operation was so blatant that "Mexican traffickers used boxes specifically designed to the dimensions of an HSBC Mexico teller's window to deposit cash on a daily basis," reports Reuters [10]. They also facilitated "hundreds of millions more in transactions with sanctioned countries," according to the Justice Department [11].

Our banks got nailed as well. "In the United States, JPMorgan Chase & Co, Wachovia Corp and Citigroup Inc have been cited for anti-money laundering lapses or sanctions violations," continues the Reuters report. My, my, JPMorgan Chase, the biggest bank in the U.S. sure does get around.

And the penalty? A fine (paid by the HSBC shareholders, of course, that amounts to 5.5 weeks of the bank's earnings) and we promise – honest -- never to do it again.

Too Big to Indict?

Wait, it gets worse. Why weren't criminal charges filed against the bank itself? After all, the bank overtly violated money laundering laws. This was no clerical error. The answer is simple: "Too big to Indict," [12] screams the NYT editorial headline. You see federal authorities are worried that if they indict, the bank would fail, which in turn would lead to tens of thousands of lost jobs, just like what happened to Arthur Anderson after its Enron caper, or like the financial hurricane that followed the failure of Lehman Brothers. So if you're a small fish running $10,000 in drug money, you serve time. But if you're a big fish moving nearing a billion dollars, you can laugh all the way to your too-big-to-jail bank.

Fleecing Distressed Homeowners

The big banks, in collusion with hedge funds and the rating agencies, puffed up the housing bubble and then burst it. Nine million workers, due to no fault of their own, lost their jobs in a matter of months. Entire neighborhoods saw their home values crash. Tens of millions faced foreclosure.

The big banks, which were bailed out and survived the crash, sought to foreclose on as many homes as possible, as fast as possible. Hey, that's where the money was. In doing so they resorted to many unsavory practices including illegal robo-signing of foreclosure documents. When nailed by the government, the big banks agreed to provide billions in aid for distressed homeowners. Were they finally forced to do the right thing? Not a chance. (See "Homeowners still face foreclosure despite billion in aid" NYT 2/22 [13].)

The big banks, despite what they say in their press statements, found a convenient loophole in the government settlement. The banks began forgiving second mortgages, and then foreclosing on the first mortgage. That's a cute maneuver because in a foreclosure, the bank rarely can collect on the second mortgage anyway. So they're giving away something of no value to distressed sellers and getting government credit for it. Just another day at the office for our favorite banksters.

The Indictments Go On...

I could write a book about all the ways in which banks and their hedge fund cousins have turned cheating into a way of life. (In fact, I just did: "How to Earn a Million Dollars an Hour: Why Hedge Funds Get Away With Siphoning off America's Wealth [14]. Here's the AlterNet interview [15]. )

JPMorgan Chase, Citigroup and Goldman Sachs have been fined over a billion dollars for creating and selling mortgage-related securities that were designed to fail so their hedge fund buddies could make billions. And then we've got the recent LIBOR scandal where the biggest banks colluded to manipulate interest rates for fun and profit.

It's not about good people or bad people running these banks and hedge funds. It's the very nature of these institutions. That's what they do. They make big money by doing what the rest of us would call cheating. As the record clearly shows, they cheat the second they get the chance.

What kind of institution would loanshark, money launder, fix rates, game mortgage relief programs, and produce products designed to fail? Answer: An institution that should not exist.

Nationalize Now and Create State Banks

There are about 20 too-big-to fail banks which have been designated "systematically significant." These should be immediately nationalized. Shareholder value should be wiped out because these banks are repeatedly violating the law, including aiding and abetting criminal enterprises. All employees should be placed on the federal civil service scale, where the top salary is approximately $130,000.

Can the government run banks? Yes, if we break up the big banks and turn them over to state governments so that each state would have at least one public bank. (North Dakota has a strong working model.) The larger states would have several public state banks. But never again would we allow banks to grow so large as to threaten our financial system and violate the public trust. Let FDIC regulate the state banks. They're actually good at it.

(We'd also have to do something about the shadow banking industry -- the large hedge funds and private equity firms. Eliminating their carried-interest tax loophole and slapping on a strong financial transaction tax would go a long way toward reining them in.)

Won't the most talented bankers leave the industry?

Hurray! It can't happen soon enough. It's time for the best and the brightest to rejoin the human race and help produce value for their fellow citizens. Let them become doctors, research scientists, teachers or even wealthy entrepreneurs who produce tangible goods and services that we want and need. What we don't need are more banksters.

Isn't This Socialism?

We already have socialism for rich financiers. They get to keep all of the upside of their shady machinations and we get to bail them out when they fail. This billionaire bailout society is now so entrenched that our nascent economic recovery of the last two years has been entirely captured by the top 1 percent. Meanwhile the rest of have received nothing. Nada. (See "Why Is the Entire Recovery Going to the Top One Percent? [16]")

I know, I know, people say, "Next time, just don't bail them out!" Meanwhile, they get to rip us off, day in and day out, until the next crash? No thanks. Put them out of business now. If you have a better idea, let's hear it.

See more stories tagged with:
Links:

[1] http://www.alternet.org

[2] http://www.alternet.org/authors/les-leopold-0

[3] http://www.nytimes.com/2013/02/24/business/major-banks-aid-in-payday-loans-banned-by-states.html?hp&_r=0

[4] http://www.lectlaw.com/files/ban02.htm

[5] http://www.pewstates.org/research/reports/how-borrowers-choose-and-repay-payday-loans-85899452131

[6] http://topics.nytimes.com/topics/reference/timestopics/subjects/c/credit_crisis/financial_regulatory_reform/index.html?inline=nyt-classifier

[7] http://loanshoponline.com/

[8] http://advancemetoday.com/

[9] http://www.nytimes.com/2013/02/27/business/jpmorgan-chase-vows-to-fix-payday-loan-practices.html?ref=business

[10] http://www.reuters.com/article/2012/12/11/us-hsbc-probe-idUSBRE8BA05M20121211

[11] http://www.justice.gov/criminal/pr/speeches/2012/crm-speech-1212111.html

[12] http://www.nytimes.com/2012/12/12/opinion/hsbc-too-big-to-indict.html

[13] http://www.nytimes.com/2013/02/22/business/homeowners-still-face-foreclosure-despite-billions-in-aid.html?pagewanted=all

[14] http://www.amazon.com/How-Make-Million-Dollars-Hour/dp/1118239245/ref=tmm_hrd_title_0?ie=UTF8&qid=1358022645&sr=1-1

[15] http://www.alternet.org/just-what-do-hedge-fund-honchos-do-million-bucks-hour

[16] http://www.huffingtonpost.com/les-leopold/economic-inequality_b_2742092.html

[17] http://www.alternet.org/tags/wall-street

[18] http://www.alternet.org/%2Bnew_src%2B

16 Signs That The Middle Class Is Running Out Of Money


Is "discretionary income" rapidly becoming a thing of the past for most American families?  Right now, there are a lot of signs that we are on the verge of a nightmarish consumer spending drought.  Incomes are down, taxes are up, many large retail chains are deeply struggling because of the lack of customers, and at this point nearly a quarter of all Americans have more credit card debt than money in the bank.  Considering the fact that consumer spending is such a large percentage of the U.S. economy, that is very bad news.  How will we ever have a sustained economic recovery if consumers don't have much money to spend?  Well, the truth is that we aren't ever going to have a sustained economic recovery.  In fact, this debt-fueled bubble of false hope that we are experiencing right now is as good as things are going to get.  Things are going to go downhill from here, and if you think that consumer spending is bad now, just wait until you see what happens over the next several years. Even though the Dow is surging toward a record high right now, everyone knows that things are not good for the middle class.  A recent quote from CPA Howard Dvorkin kind of summarizes our current state of affairs very nicely...

"The fact of the matter is that America is broke — whether it's mortgages, student loans or credit cards, we are broke. The old rule of thumb is that people should have six months' of savings," Dvorkin says."If you talk to people, most don't have two pennies."
These days most Americans are living from paycheck to paycheck, and thanks to rising prices and rising taxes, those paychecks are getting squeezed tighter and tighter.  Many families have had to cut back on unnecessary expenses, and some families no longer have any discretionary income at all.

The following are 16 signs that the middle class is rapidly running out of money...

#1 According to one brand new survey, 24 percent of all Americans have more credit card debt than money in the bank.

#2 J.C. Penney was once an unstoppable retail powerhouse, but now J.C. Penney has just posted its lowest annual retail sales in more than 20 years...

J.C. Penney Co. (JCP) slid the most in more than three decades after the department-store chain lost $4.3 billion in sales in the first year of Chief Executive Officer Ron Johnson’s turnaround plan.

The shares fell 18 percent to $17.40 at 11:28 a.m. in New York after earlier declining 22 percent, the biggest intraday drop since at least 1980, according to data compiled by Bloomberg. J.C. Penney yesterday said its net loss in the quarter ended Feb. 2 widened to $552 million from $87 million a year earlier. The Plano, Texas-based retailer’s annual revenue slid 25 percent to $13 billion, the lowest since at least 1987.
How much worse can things get?  At this point the decline has become so steep for J.C. Penney that Jim Cramer of CNBC is declaring that they are in "a true tailspin".

#3 In the United States today, a new car has become out of reach for most middle class Americans according to the 2013 Car Affordability Study...

Looking to buy a new car, truck or crossover? You may find it more difficult to stretch the household budget than you expected, according to a new study that finds median-income families in only one major U.S. city actually can afford the typical new vehicle.

The typical new vehicle is now more expensive than ever, averaging $30,500 in 2012, according to TrueCar.com data, and heading up again as makers curb the incentives that helped make their products more affordable during the recession when they were desperate for sales. According to the 2013 Car Affordability Study by Interest.com, only in Washington could the typical household swing the payments, the median income there running $86,680 a year.
#4 The founder of Subway Restaurants, Fred Deluca, says that the recent tax increases are having a noticeable impact on his business...

"The payroll tax is affecting sales. It's causing sales declines," he said, estimating a decline of about 2 percentage points off sales at his restaurants. "There are a lot of pressures on consumers," Deluca said, adding "I think this is on the permanent side, but I think business will adjust to it."
#5 Many other large restaurant chains are also struggling in this tough economic environment...

Darden Restaurants, which owns the casual dining chains Oliver Garden, LongHorn Steakhouse and Red Lobster, said blended same-store sales at its three eateries would be 4.5 percent lower during its fiscal third quarter.

Clarence Otis, Darden's chairman and chief executive, said that "while results midway through the third quarter were encouraging, there were difficult macro-economic headwinds during the last month of the quarter."

"Two of the most prominent were increased payroll taxes and rising gasoline prices, which together put meaningful pressure on the discretionary purchasing power of our guests," he added.
#6 The CFO of Family Dollar recently admitted to CNBC that this is a "challenging time" because of reduced consumer spending...

At Family Dollar where the average customer makes less than $40,000 a year, the combination of a two-percent hike in the payroll tax, rising gas prices and delayed tax refunds has created a "challenging time and an uncertain time for the consumer right now," said Mary Winston, the company's chief financial officer.

"In our case, anything that takes money out of our customer's wallet gives them less money to spend in our stores," she told CNBC. "So I think all of those things create nervousness for the consumer, and I think there are sometimes political dynamics going on that they might not even fully understand the details, but they know it's not good."
#7 Even Wal-Mart is really struggling right now.  According to a recent Bloomberg article, Wal-Mart is struggling "to restock store shelves as U.S. sales slump"...

Evelin Cruz, a department manager at the Wal-Mart Supercenter in Pico Rivera, California, said Simon’s comments from the officers’ meeting were “dead on.”

“There are gaps where merchandise is missing,” Cruz said in a telephone interview. “We are not talking about a couple of empty shelves. This is throughout the store in every store. Some places look like they’re going out of business.”
This all comes on the heels of an internal Wal-Mart memo that was leaked to the press earlier this month that described February sales as a "total disaster".

#8 Electronics retailer Best Buy continues to struggle mightily.  Best Buy just announced that it will be eliminating 400 jobs at its headquarters in Richfield, Minnesota.

#9 It is being projected that many of the largest retail chains in America, including Best Buy, will close down hundreds of stores during 2013.  The following is a list of projected store closings for 2013 that I included in a previous article...

Best Buy

Forecast store closings: 200 to 250

Sears Holding Corp.

Forecast store closings: Kmart 175 to 225, Sears 100 to 125

J.C. Penney

Forecast store closings: 300 to 350

Office Depot

Forecast store closings: 125 to 150

Barnes & Noble

Forecast store closings: 190 to 240, per company comments

Gamestop

Forecast store closings: 500 to 600

OfficeMax

Forecast store closings: 150 to 175

RadioShack

Forecast store closings: 450 to 550

#10 Another sign that consumer spending is slowing down is the fact that less stuff is being moved around in our economy.   As I have mentioned previously, freight shipment volumes have hit their lowest level in two years, and freight expenditures have gone negative for the first time since the last recession.

#11 Many young adults have no discretionary income to spend because they are absolutely drowning in student loan debt.  According to the New York Federal Reserve, student loan debt nearly tripled between 2004 and 2012.

#12 The student loan delinquency rate in the United States is now at an all-time high.  It is only a matter of time before the student loan debt bubble bursts.

#13 Due to a lack of jobs and high levels of debt, poverty among young adults in America is absolutely exploding.  Today, U.S. families that have a head of household that is under the age of 30 have a poverty rate of 37 percent.

#14 According to one recent survey, 62 percent of all middle class Americans say that they have had to reduce household spending over the past year.

#15 Median household income in the United States has fallen for four consecutive years.  Overall, it has declined by more than $4000 during that time span.

#16 According to the U.S. Census Bureau, the middle class is currently taking home a smaller share of the overall income pie than has ever been recorded before.

Are you starting to get the picture?

Retailers are desperate for sales, but you can't squeeze blood out of a rock.

For much more on how the middle class is absolutely drowning in debt, please see this article: "Money Is A Form Of Social Control And Most Americans Are Debt Slaves".

But if you listen to the mainstream media, they would have you believe that happy days are here again.

Right now, everyone seems to be quite giddy about the fact that the Dow is marching toward an all-time high.  And I actually do believe that the Dow will blow right past it.  In fact, it is even possible that we could see the Dow hit 15,000 before everything starts falling apart.

But at some point, the financial markets will catch up with economic reality.  It is just a matter of time.

In the meanwhile, those that are wise are taking advantage of these times of plenty to prepare for the great economic drought that is coming.

Don't be caught living paycheck to paycheck and totally unprepared when the next wave of the economic collapse strikes.  Anyone that believes that this debt-fueled bubble of false hope can last indefinitely is just being delusional.

Supreme Court Shields Warrantless Eavesdropping Law From Constitutional Challenge

The five right-wing justices hand Obama a victory by accepting his DOJ's secrecy-based demand for dismissal


The National Security Agency (NSA) headquarters in Fort Meade, Maryland. Among other forms of intelligence-gathering, the NSA secretly collects the phone records of millions of Americans, using data provided by telecom firms AT&T, Verizon and BellSouth. Photograph: NSA/Getty Images
The Obama justice department succeeded in convincing the five right-wing Supreme Court justices to dismiss a lawsuit challenging the constitutionality of the 2008 law, the FISA Amendments Act, which vastly expanded the government's authority to eavesdrop on Americans without warrants. In the case of Clapper v. Amnesty International, Justice Samuel Alito wrote the opinion, released today, which adopted the argument of the Obama DOJ, while the Court's four less conservative justices (Ginsberg, Breyer, Sotomayor and Kagan) all dissented. This means that the lawsuit is dismissed without any ruling on whether the US government's new eavesdropping powers violate core constitutional rights. The background of this case is vital to understanding why this is so significant.

One of the most successful government scams of the last decade has been to prevent any legal challenges to its secret surveillance programs. Both the Bush and Obama DOJ's have relied on one tactic in particular to insulate its eavesdropping behavior from judicial review: by draping what it does in total secrecy, it prevents anyone from knowing with certainty who the targets of its surveillance are. The DOJ then exploits this secrecy to block any constitutional or other legal challenges to its surveillance actions on the ground that since nobody can prove with certainty that they have been subjected to this eavesdropping by the government, nobody has "standing" to sue in court and obtain a ruling on the constitutionality of this eavesdropping.

The Bush DOJ repeatedly used this tactic to prevent anyone from challenging the legality of its eavesdropping on Americans without the warrants required by the FISA law. That's another way of saying that the Bush administration removed their conduct from the rule of law: after all, if nobody has standing to obtain a court ruling on the legality or constitutionality of their conduct, then neither the law nor the Constitution constrain what the government does. Simply put, a law without a remedy is worthless. As Alexander Hamilton put it in Federalist 15:

"It is essential to the idea of a law, that it be attended with a sanction; or, in other words, a penalty or punishment for disobedience. If there be no penalty annexed to disobedience, the resolutions or commands which pretend to be laws will, in fact, amount to nothing more than advice or recommendation."
Thus did the Bush DOJ exploit their secrecy extremism into a license of lawlessness: they never had to prove that even their most radical actions were legal because by keeping it all a secret, they prevented anyone from being able to obtain a ruling about its legality.

The Obama DOJ has embraced this tactic in full. In 2008, the Democratic-led Congress (with the support of then-Sen. Barack Obama) enacted the so-called FISA Amendments Act, which dramatically expanded the government's warrantless eavesdropping powers beyond what they had been for the prior 30 years. The primary intention of that new law was to render the Bush warrantless eavesdropping program legal, and it achieved that goal by authorizing the NSA to engage in whole new categories of warrantless surveillance aimed at Americans.

Since its enactment, the Obama administration has been using that massively expanded eavesdropping authority to spy on the electronic communications of Americans without the need to obtain specific warrants (the law simply provides that the government must periodically obtain court approval for their general methods of eavesdropping, but not approval for their specific eavesdropping targets). At the end of last year, the Obama administration relied on overwhelming GOP Congressional support to extend this law for another five years without a single reform.

Immediately upon enactment of this new law in 2008, the ACLU filed a lawsuit alleging that the warrantless eavesdropping powers it vests violate the First and Fourth Amendments. The plaintiffs in the case are US lawyers, journalists, academic researchers and human rights activists and groups (such as Amnesty) who work on issues of terrorism, foreign policy and human rights. They argued that they have standing to challenge the constitutionality of the eavesdropping law because its very existence impedes their work in numerous ways and makes it highly likely that their communications with their clients and sources will be targeted for interception by the NSA.

Because the Obama administration insists that it is a secret who they target for eavesdropping, neither these plaintiffs - nor anyone else - can prove with absolute certainty that they or their clients have been targeted. Taking a page (as usual) from the Bush DOJ, the Obama DOJ thus argued in response to this lawsuit that this secrecy means that nobody has "standing" to challenge the constitutionality of this law. With perfect Kafkaesque reasoning, the Obama DOJ says that (1) who we spy on is a total secret, and therefore (2) nobody has the right to obtain a judicial ruling as to whether what we are doing is legal or constitutional.

It is true that "standing" is an important doctrine: the requirement that a person first prove that they have been uniquely harmed by a law they want to challenge is not only necessary to fulfill the Constitution's limitation on the federal court's power (which confines their authority to actual "cases or controversies"), but it also prevents the Court from acting as a free-floating arbiter that rules on every political question. Courts can only rule on actual cases where one party has concretely harmed another.

The plaintiffs, however, have argued that although they cannot prove they or their clients and sources have been targeted, they are already being harmed by the existence of this law. They have ample reason to fear, they say, that the communications they have with their clients or sources are targeted for interception by the government. That means that this law forces them to refrain from communicating, or to expend substantial sums to travel across the world to meet in person with them, or that these clients and sources refuse to speak to them out of fear of being eavesdropped on. These concrete harms mean, they say, that they have standing to sue the government and obtain a ruling as to whether this law is constitutional.

In 2011, the Second Circuit Court of Appeals rejected the Obama DOJ's arguments and ruled that plaintiffs had standing to challenge the eavesdropping law given the concrete harms they are suffering from the mere existence of these eavesdropping powers. Rather than defend the constitutionality of the law, the Obama DOJ appealed this decision to the Supreme Court, and asked the court to dismiss the suit on standing grounds, without reaching the merits of the lawsuit.

Today, the Supreme Court, by a 5-4 decision, agreed to do exactly that. Justice Alito (joined by Scalia, Thomas, Roberts and Kennedy) fully embraced the Kafka-like rationale of the Obama DOJ. They rewarded the government for its extreme secrecy by using it to bar any challenges to the law; said Alito:

"[Plaintiffs] have no actual knowledge of the Government's §1881a targeting practices. Instead, [plaintiffs] merely speculate and make assumptions about whether their communications with their foreign contacts will be acquired under §1881a. . . . [Plaintiffs], however, have set forth no specific facts demonstrating that the communications of their foreign contacts will be targeted. Moreover, because §1881a at most authorizes — but does not mandate or direct — the surveillance that [plaintiffs] fear, [plaintiffs'] allegations are necessarily conjectural. . . . Simply put, [plaintiffs] can only speculate as to how the Attorney General and the Director of National Intelligence will exercise their discretion in determining which communications to target."
To call this argument ludicrous is to be generous. Every one of the plaintiffs here have been harmed by this eavesdropping law. In the course of their work, they have cause to communicate regularly with people whom the US government suspects are involved in Terrorism. When combined with the US government's technological abilities to spy on virtually every communication anywhere in the world, along with the government's proven propensity to eavesdrop on everyone it deems has anything to do with a terrorist group, it is a virtual certainty that the communications of these plaintiffs will be targeted, as Justice Breyer explained in dissent:

"In my view, this harm is not 'speculative'. Indeed it is as likely to take place as are most future events that commonsense inference and ordi­nary knowledge of human nature tell us will happen. . . . .

"Several considerations, based upon the record along with commonsense inferences, convince me that there is a very high likelihood that Government, acting under the authority of §1881a, will intercept at least some of the communications just described . . . . . The Government has a strong motive to conduct surveillance of conversations that contain material of this kind. . . . [T]he Government's past behavior shows that it has sought, and hence will in all likelihood continue to seek, information about alleged terrorists and detainees through means that include surveillance of electronic communications. As just pointed out, plaintiff Scott McKay states that the Government (under the authority of the pre-2008 law) 'intercepted some 10,000 telephone calls and 20,000 email communications involving [his client] Mr. Al-Hussayen.'

"To some de­gree this capacity rests upon technology available to the Government. See 1 D. Kris & J. Wilson, National Security Investigations & Prosecutions §16:6, p. 562 (2d ed. 2012) ('NSA's technological abilities are legendary'); id., §16:12, at 572–577 (describing the National Security Agency's capacity to monitor 'very broad facilities' such as interna­tional switches). See, e.g., Lichtblau & Risen, Spy Agency Mined Vast Data Trove, Officials Report, NY Times, Dec. 24, 2005, p. A1 (describing capacity to trace and to analyze large volumes of communications into and out of the United States)".
In sum, the US government has constructed a ubiquitous Surveillance State. It has repeatedly demonstrated that it intends to eavesdrop on the communications of exactly the people who have brought this lawsuit. To prevent them from suing on the ground that the US government's secrecy precludes them from proving with certainty that they are being targeted is to remove the US government's surveillance actions from the rule of law and the constraints of the Constitution.

But that is what the Obama DOJ just succeeded in convincing the five right-wing members of the Court to do: allow it to conduct its Surveillance State beyond the rule of law. What's the point of having a Fourth Amendment that bars unreasonable searches and seizures without probable cause warrants if the US government simply shrouds its unconstitutional eavesdropping with so much secrecy that it prevents anyone from challenging the legality of what it is doing?

The supreme irony here is that when Obama supported this 2008 eavesdropping law, it sparked intense anger among his own supporters as he ran for president. To placate that anger, he vowed that, once in power, he would rein in the excesses of this law that he oh-so-reluctantly supported. He has done exactly the opposite. He just succeeded in pressuring the Congress, with heavy GOP support, to extend this eavesdroppiong law for five years without a single reform. And now his Justice Department has used the five right-wing justices to completely immunize the law from judicial review (the only way the law could now be challenged is from a handful of extremely unlikely situations, such as if the US government criminally prosecutes the foreign clients and sources of these plaintiffs using information they obtained from the warrantless eavesdropping, and even then, the ability to challenge the law's constitutionality is far from certain).

When the new 2008 FISA eavesdropping law was passed, all sorts of legal scholars debated its constitutionality, but it turns out that debate was - like the Constitution itself - completely academic. As both the Bush and Obama administrations have repeatedly proven, they are free to violate the Constitution at will just so long as they do so with enough secrecy to convince subservient federal courts to bar everyone from challenging their conduct.

The Power to Assassinate a Compliant and Submissive People

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President Obama’s nomination of John Brennan is being held up over Brennan’s refusal to state whether the president’s power to assassinate Americans (and others) extends to American soil. The controversy is summed up in a great article by Glenn Greenwald.
The fact that Brennan could not bring himself to immediately say that the president doesn’t have the power to assassinate Americans (and others) right here within the United States is revealing. He undoubtedly knows that the president does claim to wield such power and that the president just doesn’t want to alarm Americans by informing them that he now wields the power to assassinate anyone he wants, including Americans here in the United States.

I can’t see how there’s any room for doubt here. Ever since President Bush claimed extraordinary powers after the 9/11 attacks, we here at The Future of Freedom Foundation have been pointing out that the powers were not limited to foreigners or to foreign lands. When U.S. forces, both military and CIA, were kidnapping people, torturing them, and incarcerating them without trial, we kept emphasizing that such powers were not limited to foreigners. By following the logic employed by Bush and his associates, it was clear that those extraordinary powers extended to Americans as well, both abroad and here at home.

But all too many Americans comforted themselves by thinking that those extraordinary powers applied only to foreigners and that the powers were necessary to keep them “safe.” Therefore, they endorsed what was going on with much enthusiasm, simply blocking out of their minds that they were also endorsing the most revolutionary change in the relationship between the federal government and the American citizenry in U.S. history.

Then came the case of Jose Padilla. He was an American who was accused of conspiracy to commit terrorism. Rather than have him indicted and then prosecute him in federal court, the feds whisked him away to a military dungeon, where the Pentagon tortured him and threatened to keep him incarcerated for the rest of his life as an “enemy combatant”  in the “war on terrorism.”

We took a leading role in opposing that extraordinary exercise of military supremacy over the American citizenry. We continually pointed out that what they did to Padilla, if upheld, they could then do to all other Americans. But because Padilla was not the most sympathetic character in the world, all too many Americans were happy over what the feds were doing to him, blocking out of their minds that the feds could now do the same thing to all other Americans.

And sure enough, the federal courts, in the fear-ridden environment of post-9/11, upheld what the president and the Pentagon did to Padilla, which means that they can now do the same to every American — and some 12 years after the 9/11 attacks!

And now we have the president’s assassination program, in which the president, along with his military and CIA, now wield the power to assassinate anyone they want, no questions asked. They’ve already killed countless foreigners as well as at least three Americans, including a 16-year-old boy. They do it all in secret and are not required to answer any questions as to who they have assassinated or why. Their power to kill people is omnipotent.

Do they claim the power to assassinate Americans right here at home? How can there be any doubt about it? From the very beginning, they simply converted a standard federal crime — terrorism — into an act of war. They called it “the war on terrorism,” and said that this war was just like World Wars I and II. They said that in war, they have the right to take captives, torture them, and execute illegal enemy combatants, and also to assassinate the enemy.

They also said that this war would go on forever or for at least the lifetimes of everyone living today, given that there were so many terrorists in the world. As part of that war, the president, the military, and the CIA would have to assume extraordinary powers, they said, ones that were inherent to the most extreme dictatorships in history.

Significantly, they repeatedly emphasized that in this war, the battlefield wasn’t limited to the Middle East or surrounding regions. Instead, in this war the entire world constituted the battlefield. That, of course, included the United States.

Thus, it didn’t take a rocket scientist to draw the logical conclusion — whatever extraordinary powers were being exercised against foreign “enemy combatants” in the “war on terrorism” could be applied against people right here on American soil, including Americans.

Of course, as we have also been pointing out since 9/11, the entire matter is just one great big sham and fraud. They took a federal criminal offense — terrorism — and used it a ruse to claim that America was now “at war” and then claimed extreme dictatorial powers in the process. It would be no different if the president used another federal war — the “war on drugs” — as a ruse to assume extraordinary dictatorial powers, such as the power to kidnap, torture, execute, and assassinate suspected drug users and dealers.

Our American ancestors tried their best to prevent this dictatorial nonsense. That’s why they used the Constitution to bring into existence a government of limited, enumerated powers. Notice that the dictatorial powers claimed by Bush and Obama are not among those enumerated powers. To make sure that federal officials got the point, our ancestors demanded the enactment of four separate amendments to the Constitution — the 4th, 5th, 6th, and 8th Amendments. Those amendments stated that with respect to federal crimes, people would be guaranteed the protections of criminal indictments, due process of law, trial by jury, freedom from cruel and unusual punishments, and other protections.

And there is another important thing to note about those four amendments. Notice that the protections and guarantees apply to people in general, not just to Americans. That’s because our ancestors understood that justice requires that the rules apply to everyone equally, not one set of rules for foreigners and another set of rules for Americans. Thus, under our system of justice, President Obama has no right to be assassinating anyone or torturing anyone or incarcerating anyone without due process of law and trial by jury.

And it must be emphasized: terrorism is, in fact, a federal crime. That’s why they ultimately made Padilla a criminal defendant. That’s why terrorism is listed in the U.S. Code as a criminal offense. That’s why they have terrorism cases in federal court all the time. The truth is that there is no real war and there has never been one, any more than there has been a real war in the “war on drugs.” After all, how is the enemy supposed to surrender in this “war”? Where are the transport ships bringing invading troops to America? Where are the supply lines?

And let’s not forget something else of equal importance — the only reason that people are killing U.S. troops over there is because they’re over there interfering with the affairs of other countries. That’s what the killing is all about on both sides —not because people are trying to conquer America and enslave Americans but simply because they want the U.S. government, especially the U.S. military and CIA, out of their countries. And the more the Pentagon and the CIA continue to kill people in the process, the more they generate an endless supply of terrorists, which they then use to perpetuate their dictatorial powers. As I have long pointed out, the U.S. government is the greatest terrorist-producing machine in history.

It’s all been a sham, a fraud, and a ruse to enable the U.S. national-security state to adopt the same powers of dictatorship that it has long supported and trained, such as Pinochet’s dictatorship in Chile, the military dictatorships in Guatemala, the Shah’s dictatorship in Iran, Mubarak’s dictatorship in Egypt, and many more.

But Brennan shouldn’t been concerned about alarming Americans about Obama’s power to assassinate them on American soil. As we have learned since 9/11, the American people are among the most compliant, cooperative, and submissive people on the planet. All the feds have to do is say that they are doing it to keep them safe, and except for libertarians and (a few liberals and conservatives), unfortunately all too many Americans continue to fall for anything and agree to anything the government wants to do to them.

50 Signs The U.S. Health Care System Is A Money Making Scam That Is About To Collapse

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The U.S. health care system is a giant money making scam that is designed to drain as much money as possible out of all of us before we die.  In the United States today, the health care industry is completely dominated by government bureaucrats, health insurance companies and pharmaceutical corporations.  The pharmaceutical corporations spend billions of dollars to convince all of us to become dependent on their legal drugs, the health insurance companies make billions of dollars by providing as little health care as possible, and they both spend millions of dollars to make sure that our politicians in Washington D.C. keep the gravy train rolling.  Meanwhile, large numbers of doctors are going broke and patients are not getting the care that they need.  At this point, our health care system is a complete and total disaster.  Health care costs continue to go up rapidly, the level of care that we are receiving continues to go down, and every move that our politicians make just seems to make all of our health care problems even worse.  In America today, a single trip to the emergency room can easily cost you $100,000, and if you happen to get cancer you could end up with medical bills in excess of a million dollars.  Even if you do have health insurance, there are usually limits on your coverage, and the truth is that just a single major illness is often enough to push most American families into bankruptcy.  At the same time, hospital administrators, pharmaceutical corporations and health insurance company executives are absolutely swimming in huge mountains of cash.  Unfortunately, this gigantic money making scam has become so large that it threatens to collapse both the U.S. health care system and the entire U.S. economy. The following are 50 signs that the U.S. health care system is a massive money making scam that is about to collapse...

#1 Medical bills have become so ridiculously large that virtually nobody can afford them.  Just check out the following short excerpt from a recent Time Magazine article.  One man in California that had been diagnosed with cancer ran up nearly a million dollars in hospital bills before he died...

By the time Steven D. died at his home in Northern California the following November, he had lived for an additional 11 months. And Alice had collected bills totaling $902,452. The family’s first bill — for $348,000 — which arrived when Steven got home from the Seton Medical Center in Daly City, Calif., was full of all the usual chargemaster profit grabs: $18 each for 88 diabetes-test strips that Amazon sells in boxes of 50 for $27.85; $24 each for 19 niacin pills that are sold in drugstores for about a nickel apiece. There were also four boxes of sterile gauze pads for $77 each. None of that was considered part of what was provided in return for Seton’s facility charge for the intensive-care unit for two days at $13,225 a day, 12 days in the critical unit at $7,315 a day and one day in a standard room (all of which totaled $120,116 over 15 days). There was also $20,886 for CT scans and $24,251 for lab work.
#2 This year the American people will spend approximately 2.8 trillion dollars on health care, and it is being projected that Americans will spend 4.5 trillion dollars on health care in 2019.

#3 The United States spends more on health care than Japan, Germany, France, China, the U.K., Italy, Canada, Brazil, Spain and Australia combined.

#4 If the U.S. health care system was a country, it would be the 6th largest economy on the entire planet.

#5 Back in 1960, an average of $147 was spent per person on health care in the United States. By 2009, that number had skyrocketed to $8,086.

#6 Why does it cost so much to stay in a hospital today?  It just does not make sense.  Just check out these numbers...

In 1942, Christ Hospital, NJ charged $7 per day for a maternity room. Today it’s $1,360.
#7 Approximately 60 percent of all personal bankruptcies in the United States are related to medical bills.

#8 One study discovered that approximately 41 percent of all working age Americans either have medical bill problems or are currently paying off medical debt.

#9 The U.S. health care industry has spent more than 5 billion dollars on lobbying our politicians in Washington D.C. since 1998.

#10 According to the Association of American Medical Colleges, the U.S. is  currently experiencing a shortage of at least 13,000 doctors.  Unfortunately, that shortage is expected to grow to 130,000 doctors over the next 10 years.

#11 The state of Florida is already dealing with a very serious shortage of doctors...

Brace yourself for longer lines at the doctor's office.

Whether you're employed and insured, elderly and on Medicare, or poor and covered by Medicaid, the Florida Medical Association says there's a growing shortage of doctors — especially specialists — available to provide you with medical care.

And if the Florida Legislature goes along with Gov. Rick Scott's recommendation to offer Medicaid coverage to an additional 1 million Floridians — part of the Affordable Care Act that takes effect next January — the FMA says that shortage will only get worse.
#12 At this point, approximately 40 percent of all doctors in the United States are 55 years of age or older.

#13 In America today, many hospital executives make absolutely ridiculous amounts of money...

In December, when the New York Times ran a story about how a deficit deal might threaten hospital payments, Steven Safyer, chief executive of Montefiore Medical Center, a large nonprofit hospital system in the Bronx, complained, “There is no such thing as a cut to a provider that isn’t a cut to a beneficiary … This is not crying wolf.”

Actually, Safyer seems to be crying wolf to the tune of about $196.8 million, according to the hospital’s latest publicly available tax return. That was his hospital’s operating profit, according to its 2010 return. With $2.586 billion in revenue — of which 99.4% came from patient bills and 0.6% from fundraising events and other charitable contributions — Safyer’s business is more than six times as large as that of the Bronx’s most famous enterprise, the New York Yankees. Surely, without cutting services to beneficiaries, Safyer could cut what have to be some of the Bronx’s better non-Yankee salaries: his own, which was $4,065,000, or those of his chief financial officer ($3,243,000), his executive vice president ($2,220,000) or the head of his dental department ($1,798,000).
#14 Health insurance administration expenses account for 8 percent of all health care costs in the United States each year.  In Finland, health insurance administration expenses account for just 2 percent of all health care costs each year.

#15 If you can believe it, the U.S. ambulance industry makes more money each year than the movie industry does.

#16 All over America, people are reporting huge health insurance premium increases thanks to Obamacare.  The following example is from a recent article by Robert Wenzel...

A California small businessman tells me that he switched healthcare insurance carriers in 2012.  The monthly premium for him and his wife was about $400, but when he received his first bill in January of this year it was for $1,200.  He hasn't been to a doctor in years, his wife has only gone for minor care.

Apparently there is some clause in the Affordable Healthcare Act that results in health insurance firms using a new method to calculate premiums. Those who have health insurance plans that have been in effect since at least 2010 are grandfathered under the old calculation method, but insurance carriers are using a new formula for new plans.
#17 Blue Shield of California has announced that it wants to raise health insurance premiums by up to 20 percent this year in an effort to keep up with rising health costs.

#18 Aetna's CEO says that health insurance premiums for many Americans will double when the major provisions of Obamacare go into effect in 2014.

#19 Close to 10 percent of all U.S. employers plan to drop health coverage completely when the major provisions of Obamacare go into effect in 2014.

#20 According to a survey conducted by the Doctor Patient Medical Association, 83 percent of all doctors in the United States have considered leaving the profession because of Obamacare.

#21 Approximately 16,000 new IRS agents will be hired to help oversee the implementation of Obamacare, and the Obama administration has given the IRS 500 million extra dollars "outside the normal appropriations process" to help the IRS with their new duties.

#22 During 2013, Americans will spend more than 280 billion dollars on prescription drugs.

#23 Prescription drugs cost about 50% more in the United States than they do in other countries.

#24 In the United States today, prescription painkillers kill more Americans than heroin and cocaine combined.

#25 Nearly half of all Americans now use prescription drugs on a regular basis according to the CDC.  Not only that, the CDC also says that approximately one-third of all Americans use two or more pharmaceutical drugs on a regular basis, and more than ten percent of all Americans use five or more pharmaceutical drugs on a regular basis.

#26 The percentage of women taking antidepressants in America is higher than in any other country in the world.

#27 In 2010, the average teen in the U.S. was taking 1.2 central nervous system drugs.  Those are the kinds of drugs which treat conditions such as ADHD and depression.

#28 Children in the United States are three times more likely to be prescribed antidepressants as children in Europe are.

#29 There were more than two dozen pharmaceutical companies that made over a billion dollars in profits during 2008.

#30 According to the CDC, approximately three quarters of a million people a year are rushed to emergency rooms in the United States because of adverse reactions to pharmaceutical drugs.

#31 According to a report by Health Care for America Now, America's five biggest for-profit health insurance companies ended 2009 with a combined profit of $12.2 billion.

#32 The top executives at the five largest for-profit health insurance companies in the United States combined to bring in nearly $200 million in total compensation for 2009.

#33 The chairman of Aetna, the third largest health insurance company in the United States, brought in a staggering $68.7 million during 2010. Ron Williams exercised stock options that were worth approximately $50.3 million and he raked in an additional $18.4 million in wages and other forms of compensation.  The funny thing is that he left the company and didn’t even work the entire year.

#34 It turns out that the financial assistance that Barack Obama promised would be provided for those with "pre-existing conditions" under Obamacare is already being shut down because of a lack of funding...

Tens of thousands of Americans who cannot get health insurance because of preexisting medical problems will be blocked from a program designed to help them because funding is running low.

Obama administration officials said Friday that the state-based “high-risk pools” set up under the 2010 health-care law will be closed to new applicants as soon as Saturday and no later than March 2, depending on the state.
#35 In America today, you are 64 times more likely to be killed by a doctor than you are by a gun.

#36 People living in the United States are three times more likely to have diabetes than people living in the United Kingdom.

#37 Today, people living in Puerto Rico have a greater life expectancy than people living in the United States do.

#38 According to OECD statistics, Americans are twice as obese as Canadians are.

#39 Greece has twice as many hospital beds per person as the United States does.

#40 The state of California now ranks dead last out of all 50 states in the number of emergency rooms per million people.

#41 According to a doctor interviewed by Fox News, "a gunshot wound to the head, chest or abdomen" will cost $13,000 at his hospital the moment the victim comes in the door, and then there will be significant additional charges depending on how bad the wound is.

#42 It has been estimated that hospitals overcharge Americans by about 10 billion dollars every single year.

#43 One trained medical billing advocate says that over 90 percent of the medical bills that she has audited contain "gross overcharges".

#44 It is not uncommon for insurance companies to get hospitals to knock their bills down by up to 95 percent, but if you are uninsured or you don’t know how the system works then you are out of luck.

#45 According to a study conducted by Deloitte Consulting, a whopping 875,000 Americans were "medical tourists" in 2010.

#46 Today, there are more than 56 million Americans on Medicaid, and it is being projected that Obamacare will add 16 million more Americans to the Medicaid rolls.

#47 Back in 1965, only one out of every 50 Americans was on Medicaid.  Today, one out of every 6 Americans is on Medicaid.

#48 Today, there are more than 50 million Americans on Medicare, and that number is projected to grow to 73.2 million in 2025.

#49 When Medicare was first established by Congress, it was estimated that it would cost the federal government $12 billion a year by the time 1990 rolled around.  Instead, it cost the federal government $110 billion in 1990, and it will cost the federal government close to $600 billion this year.

#50 Even if you do have health insurance, that is no guarantee that medical bills will not bankrupt you.  Just check out what a recent Time Magazine article says happened to one unfortunate couple from Ohio that actually did have health insurance...

When Sean Recchi, a 42-year-old from Lancaster, Ohio, was told last March that he had non-Hodgkin’s lymphoma, his wife Stephanie knew she had to get him to MD Anderson Cancer Center in Houston. Stephanie’s father had been treated there 10 years earlier, and she and her family credited the doctors and nurses at MD Anderson with extending his life by at least eight years.

Because Stephanie and her husband had recently started their own small technology business, they were unable to buy comprehensive health insurance. For $469 a month, or about 20% of their income, they had been able to get only a policy that covered just $2,000 per day of any hospital costs. “We don’t take that kind of discount insurance,” said the woman at MD Anderson when Stephanie called to make an appointment for Sean.

Stephanie was then told by a billing clerk that the estimated cost of Sean’s visit — just to be examined for six days so a treatment plan could be devised — would be $48,900, due in advance.
By the way, that hospital down in Houston made a profit of 531 million dollars in one recent year.

So what can be done about all of this?

Well, the truth is that the status quo is a complete and total disaster, and every "solution" being promoted by politicians from both major political parties would only make things worse.

In the end, the U.S. health care system needs to be rebuilt from the ground up, but we all know that is not going to happen.

Instead, our politicians and the health care industry will just find additional ways to extract money from all of us, and the level of care that we all get will continue to decline.

If you don't believe this, just check out what Paul Krugman of the New York Times had to say recently...

We’re going to need more revenue…Surely it will require some sort of middle class taxes as well.. We won’t be able to pay for the kind of government the society will want without some increase in taxes… on the middle class, maybe a value added tax…And we’re also going to have to make decisions about health care, doc pay for health care that has no demonstrated medical benefits . So the snarky version…which I shouldn’t even say because it will get me in trouble is death panels and sales taxes is how we do this.
Others are urging us to become more like Europe.

But do we really want what they have in the UK?...

Sick children are being discharged from NHS hospitals to die at home or in hospices on controversial ‘death pathways’.

Until now, end of life regime the Liverpool Care Pathway was thought to have involved only elderly and terminally-ill adults.

But the Mail can reveal the practice of withdrawing food and fluid by tube is being used on young patients as well as severely disabled newborn babies.

One doctor has admitted starving and dehydrating ten babies to death in the neonatal unit of one hospital alone.

Writing in a leading medical journal, the physician revealed the process can take an average of ten days during which a  baby becomes ‘smaller and shrunken’.
In the end, my philosophy is just to avoid the U.S. health care system as much as possible.  Most doctors are just trained to do two things - prescribe drugs and cut you open.  In an emergency situation where you are about to die, those may be your best options, but otherwise I would just as soon avoid the gigantic money making scam that the U.S. health care industry has become.

But just don't take my word for it.  The following is some very sound advice from Dr. Robert S. Dotson...

Avoid contact with the existing health care system as far as possible. Yes, emergencies arise that require the help of physicians, but by and large one can learn to care for one’s own minor issues. Though it is flawed, the internet has been an information leveler for the masses and permits each person to be his or her own physician to a large degree. Take advantage of it! Educate yourself about your own body and learn to fuel and maintain it as you would an expensive auto or a pet poodle. One does not need a medical degree to:

1. avoid excessive use of tobacco or alcohol or, for that matter, caffeine;

2. avoid poisons like fluoride, aspartame, high fructose corn syrup, and addictive drugs (legal or illicit);

3. avoid unnecessary and potentially lethal imaging studies (TSA’s radiation pornbooths, excessive mammography, repetitive CT scans – exposure to all significantly increases cancer risk);

4. avoid excessive cell phone use and exposure to other forms of EMR pollution where possible (the NSA is recording everything you say and text anyway);

5. avoid daily fast food use and abuse (remember: pink slime and silicone) ;

6. avoid untested GM foods (do you really want to become “Roundup Ready?”):

7. avoid most vaccinations and pharmaceutical agents promoted by the establishment;

8. avoid risky behaviors (and, we do not need a bunch of Nanny State bureaucrats to define and police these);

9. exercise moderately;

10. get plenty of sleep;

11. drink plenty of good quality water (buy a decent water filter to remove fluoride, chloride, and heavy metals);

12. wear protective gear at work and play where appropriate (helmets, eye-shields, knee and elbow pads, etc.):

13. seek out locally-grown, whole, organic foods and support your local food producers;

14. take appropriate nutritional supplements (multi-vitamins, Vitamin C, Vitamin D3);

15. switch off the TV and the mainstream media it represents;

16. educate yourself while you can;

And, lastly...

17. QUESTION AUTHORITY!

Doing these simple, common-sense things will add healthy years to a person’s life and help one avoid most medical encounters during his or her allotted time on earth.