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Economic Collapse Near?

Collapsing Holiday Sales Are A Signal That A Recession Is Coming

Retail sales during the four day Thanksgiving weekend were down a whopping 11 percent from last year.  This is a “make or break” time of the year for many retailers, and if things don’t turn around during the coming weeks we could see a tsunami of store closings in January and February.  

As you read this article, there is already more than a billion square feet of retail space sitting empty in the United States.  Many have described the ongoing collapse of the retail industry as an “apocalypse”, and this apocalypse appears to be accelerating.  Yes, the shift to online retailers is a significant factor, but as you will see below even online retailers struggled over the holiday weekend.  The sad truth of the matter is that U.S. consumers are tapped out and are drowning in debt at this point, so they simply do not have as much money to spend as they once did.

According to the National Retail Federation, 5.2 percent fewer Americans shopped online or at retail stores over the past weekend.  Those that did shop spent an average of 6.4 percent less money than consumers did last year.

So if less people shopped, and they spent less money on average, that means that total retail sales must have been way down.

And indeed they were.  As the New York Times has reported, total retail sales were down an astounding 11 percent…

Sales, both in stores and online, from Thanksgiving through the weekend were estimated to have dropped 11 percent, to $50.9 billion, from $57.4 billion last year, according to preliminary survey results released Sunday by the National Retail Federation. Sales fell despite many stores’ opening earlier than ever on Thanksgiving Day.

And though many retailers offered the same aggressive discounts online as they did in their stores, the web failed to attract more shoppers or spending over the four-day holiday weekend than it did last year, the group said. The average person who shopped over the weekend spent $159.55 at online retailers, down 10.2 percent from last year.

No wonder there was less violence on Black Friday this year.

Traffic at retailers was way down.

Of course some analysts are trying to put a positive spin on all of this.  For example, the CEO of the National Retail Federation says that this could actually be a sign that the economy is improving…

As the WSJ reports, NRF’s CEO Matt Shay attributed the drop to a combination of factors, including the fact that retailers moved promotions earlier this year in attempt to get people out sooner and avoid what happened last year when people didn’t finish their shopping because of bad weather.

Also did we mention the NRF is perpetually cheery and always desperate to put a metric ton of lipstick on a pig? Well, hold on to your hats folks:

He also attributed the declines to better online offerings and an improving economy where “people don’t feel the same psychological need to rush out and get the great deal that weekend, particularly if they expected to be more deals,” he said.

And of course the sprint vs marathon comparisons, such as this one: “The holiday season and the weekend are a marathon not a sprint,” NRF Chief Executive Officer Matthew Shay said on a conference call. Odd how that metaphor is never used when the (seasonally-adjusted) sprint beats the marathoners.

So there you have it: a 11% collapse in retail spending has just been spun as super bullish for the US economy, whereby US consumers aren’t spending because the economy is simply too strong, and the only reason they don’t spend is because they will spend much more later. Or something.

The retail industry is absolutely brutal at this point.  It is flooded with very large competitors that are chasing fewer and fewer disposable dollars.

In order to thrive, retailers need financially healthy consumers.  But over time, U.S. consumers have been getting deeper and deeper into debt.  The chart posted below shows that consumer credit in the United States has doubled since the year 2000…

Meanwhile, the long-term trend for real median household income since the year 2000 has been down…

In order for Americans to spend money, they have to make money first.

Unfortunately, the quality of our jobs continues to plummet.

As I have written about previously, 50 percent of all American workers currently make less than $28,031 a year at their jobs.  And here are some more numbers from a report that the Social Security Administration recently released…

-39 percent of American workers made less than $20,000 last year

-52 percent of American workers made less than $30,000 last year

-63 percent of American workers made less than $40,000 last year

-72 percent of American workers made less than $50,000 last year

So in order for a typical American family to bring in $50,000 a year or more both parents usually have to work.

Sometimes they both have to work more than one job.

And with the cost of living constantly rising, family budgets are being squeezed more than ever.  That is why families have less money to spend at retail stores these days.  For even more on the current financial condition of American families, please see my previous article entitled “Are You Better Off This Thanksgiving Than You Were Last Thanksgiving?”

It is time for retailers in America to face the fact that economic conditions have fundamentally changed.  U.S. consumers simply are not in as good shape as they used to be.

In addition, online retailers are going to continue to steal sales from traditional retail locations.  This means that more stores are going to close and more retail space is going to be abandoned.

As I mentioned above, more than a billion square feet of retail space is aleady sitting vacant in the United States.  And retail consultant Howard Davidowitz is projecting that up to half of all shopping malls in the U.S. may shut down within the next couple of decades…

Within 15 to 20 years, retail consultant Howard Davidowitz expects as many as half of America’s shopping malls to fail. He predicts that only upscale shopping centers with anchors like Saks Fifth Avenue and Neiman Marcus will survive.

In the years ahead, it is going to become normal to see boarded up strip malls and abandoned shopping centers all over the country.

The golden age of retail is over, and now most retailers will have to work incredibly hard to survive the apocalypse that is unfolding right before our eyes.

Credit to Economic Collapse

5 Complete Lies About America's New $18 Trillion Debt Level

Submitted by Simon Black via Sovereign Man blog,

On October 22, 1981, the government of the United States of America accumulated an astounding $1 TRILLION in debt.

At that point, it had taken the country 74,984 days (more than 205 years) to accumulate its first trillion in debt.

It would take less than five years to accumulate its second trillion.

And as the US government just hit $18 trillion in debt on Friday afternoon, it has taken a measly 403 days to accumulate its most recent trillion.

There’s so much misinformation and propaganda about this; let’s examine some of the biggest lies out there about the US debt:

1) “They can get it under control.”

What a massive lie. Politicians have been saying for decades that they’re going to cut spending and get the debt under control.

FACT: The last time the US debt actually decreased from one fiscal year to the next was back in 1957 during the EISENHOWER administration.

FACT: For the last several years, the US government has been spending roughly 90% of its ENTIRE tax revenue just to pay for mandatory entitlement programs and interest on the debt.

This leaves almost nothing for practically everything else we think of as government.

2) “The debt doesn’t matter because we owe it to ourselves.”

This is probably the biggest lie of all. Two of the Social Security trust funds alone (OASI and DI) own $2.72 trillion of US debt.

The federal government owes this money to current and future beneficiaries of those trust funds, i.e. EVERY SINGLE US CITIZEN ALIVE.

I fail to see the silver lining here. How is it somehow ‘better’ if the government defaults on its citizens as opposed to, say, banks?

3) “They can always ‘selectively default’ on the debt”

Another lie. People think that the US government can pick and choose who it pays.

They could make a bing stink about China, for example, and then choose to default on the $2 trillion in debt that’s owed to the Chinese.

Nice try. But this would rock global financial markets and destroy whatever tiny shred of credibility the US still has.

Others have suggested that the government could selectively default on the Federal Reserve (which owns $2.46 trillion of US debt).

Again, possible. But given that the Fed (the issuer of the US dollar) would become immediately insolvent, the resulting currency crisis would be completely disastrous.

4) “It’s the NET debt that’s important”

Analysts often pay attention to a country’s “net debt” instead of its gross debt. If you have a million bucks in debt, and a million bucks in cash, then your ‘net debt’ is zero. It washes out.

Problem is, the US government doesn’t have any cash. The Treasury Department opened its business day on Friday morning with just $71.9 billion in cash, or just 0.39% of its total debt level.

Apple has more money than that.

5) “They can fix it by raising taxes”

No they can’t. Just look at the numbers. Since the end of World War II, US government tax revenue has consistently been roughly 17% of GDP.

They can raise tax rates, but it doesn’t move the needle in terms of revenue as a percentage of GDP.

In other words, the government’s ‘slice of the pie’ is pretty consistent.

You’d think with this obvious data that, rather than try to increase tax rates (ineffective), they’d do everything they can to help make a bigger pie.

Or better yet, just leave everyone the hell alone so we’re free to bake as much as we can.

But no. They have to regulate every aspect of people’s existence: How you are allowed to educate your children. What you can/cannot put in your body. How much interest you are entitled to receive on your savings.

All of this costs time, money, and efficiency. So do never-ending wars. The bombs. The drones. The airstrikes.

This isn’t about any single person or President. The problem is with the system itself.

History shows that every leading superpower from the past almost invariably fell to the same fate.

Great powers often feel that their wealth and success entitles them to spend recklessly and wage endless, arrogant wars. The Romans. The Ottoman Empire. The British.

History may not repeat but it certainly rhymes. And the lesson here is very clear: debt weakens a nation. It weakens a society.

Generations that will not even be born for decades will inherit these debts by complete accident of birth.

And the people in charge of the system have backed themselves into a corner where there is no way out other than to default– either on their creditors (creating a global financial crisis), the central bank (creating a currency crisis), or on the citizens themselves (creating an epic social crisis).

Bottom line: this is not a consequence-free environment. And while you can’t fix the debt problem, you can certainly reduce your own exposure to what happens next.

Credit to Zero Hedge

US Army Sends 100 Bradley And Abrams Tanks To Eastern Europe To "Deter Russian Aggression"

The ink on Barack Obama's Chuck Hagel termination letter hasn't dried yet but already the US president's new, and seemingly far more hawkish advisors, are having their warmongering presence felt. 

Case in point: the Eastern European theater of (Cold) war, where Military.com reports that the new Army commander in Europe plans to bolster the U.S. armored presence in Poland and the Baltic states and keep rotations of U.S. troops there through next year and possibly beyond to counter Russia. Lt. Gen. Frederick "Ben" Hodges, who replaced Lt. Gen. Donald M. Campbell  earlier this month as commander of U.S. Army Europe, said the Army was looking to add about 100 Abrams tanks and Bradley Fighting Vehicles to the forces in Eastern Europe.

These U.S. Army M1A2 Abrams tanks are part of the European Activity Set,
a combined-arms battalion-sized set of vehicles and equipment pre-positioned
at Germany’s Grafenwoehr Training Area. Markus Ruachenberger/U.S. Army

"We are looking at courses of action for how we could pre-position equipment that we would definitely want to put inside a facility where it would be better maintained, that rotational units could then come and draw on it and use it to train, or for contingency purposes," Hodges said in a briefing from Vilnius, Lithuania.

So "better maintained... or for contingency purposes." Got it. That probably also explains why as NATO is seeking to deliver 100 tanks to Eastern Europe, it has already added several squadrons of fighter jets just minutes away from Russia's border. For "contingency purposes." 

Before:

After:

As before, we wonder how the US would react if Russia were to place a few extra fighter jets in Cuba or a few hundred tanks in Mexico. Aside from historical fact of course.

But back to NATO's tanks whose only mission is "contingency", and certainly not to intimidate Putin that the NATO ring around the nation is closing.

Hodges visited a training site in Lithuania that could be used to store armor and said he would look at similar sites in Estonia and Poland. "Certainly, I don't see a need to build infrastructure -- a FOB [Forward Operating Base] if you will -- or anything like that, that would be used for U.S. forces," Hodges said.

Since taking command, Hodges has made clear his concerns about Russia, which annexed Crimea last March and has supported the separatists in eastern Ukraine. U.S. Army Europe, which had 280,000 troops at the height of the Cold War, now has 31,000.

The rotations of U.S. troops on training missions in Eastern Europe would provide "deterrence against Russian aggression," Hodges said. 

"I don't think that Russia has any intention of some sort of a conventional attack into NATO territory because they know that would generate an Article 5 response."

Which is why it is best to provoke Russia first by building up NATO armed forces on Russia borders, something NATO previously express would not happen. 

He referred to the NATO treaty article calling on all member states to respond to an attack on any member of the alliance. Poland, Lithuania, Estonia and Latvia are all members of the 28-member NATO alliance.

"I think that what they [the Russians] do want to do is to create that ambiguity, plant the seeds of uncertainty so that the alliance members lose confidence that the rest of the alliance would come to their aid if they were, in fact, attacked," Hodges said.

Well, no, that's not what the Russians want. But if NATO keeps piling fighter jets and tanks on its border it will leave Putin no other choice. Which is precisely what the NATO endgoal is here.

In other news, speaking on background, a senior administration official traveling with Vice President Joe Biden on his trip to Ukraine last week said the U.S. has provided more than $100 million in non-lethal assistance "to help the Ukrainians defend themselves."

The aid included night-vision goggles;protective vests; counter-mortar radars; blankets; vehicles; and Meals, Ready to Eat, the official said. The official said the U.S. had concluded that arming Ukraine would be counter-productive since "no matter how many weapons we provided to Ukraine, they were going to get outgunned by the Russians."

Well, actually here the US is lying once again. Recall that "Hacked US Documents Said To Reveal Extent Of Undisclosed US "Lethal Aid" For Ukraine Army", proving once again that the US is just as heavily involved in the Ukraine civil war as is Russia, also implying that the stated NATO reason for intervention is nothing but the red herring NATO wants to brings tensions to a new high, one that preferably breaks out in limited conflict or contained armed combat. Because clearly the global economy has reached its GDP plateau and only war can push it beyond at this point.

And speaking of limited conflict, Germany is already having nightmares about what is sure to be a very, very long recession. As Pravda reported, "the German government prepares for a long conflict with Russia." German Foreign Minister Frank-Walter Steinmeier said the crisis with Russia could take more than a decade, and Ukraine's aspirations to NATO only "adds fuel to the fire," he said in an interview with ZDF television channel on Sunday, November 30th.

"Sometimes, 14 days are enough to start a conflict, but may take 14 years to solve this conflict," the head of German diplomacy said. When asked whether the conflict with Russia could last for such a long time, Steinmeier responded positively. 

For the German minister, the issue of Crimea's future appears to be unsolvable.  According to Steinmeier, international recognition of the Crimea as a part of the Russian territory is impossible. "We can not either ignore the illegal annexation of the Crimea, or forget about it and just ignore this fact. The conflict between us will continue," the Foreign Minister of Germany said.

Horrible news if you are Europe, right? Well yes... and no. Horrible if you are a member of the soon to be exinct middle-class, i.e., the 99%. If you are lucky enough to be among Europe's uber-rich, all that the decade long conflict between Europe and Russia will do is provide the ECB with a constant scapegoat to engage in more, more, more easing, be it QE or otherwise, which in turn will crush the middle class like in the US, but make the uber-rich, uber-richer than they have ever been. 

Which is ironic: as Europe's wealthiest wage a war of words against the former KGB spy and current head of Russia through their numerous media holdings, it is they that should be most grateful for his existence.

Credit to Zero Hedge

UN Cites Ferguson as Need To Disarm US Citizens

UN resolution: Israel must renounce nuclear arms

The U.N. General Assembly overwhelmingly approved an Arab-backed resolution Tuesday calling on Israel to renounce possession of nuclear weapons and put its nuclear facilities under international oversight.

The resolution, adopted in a 161-5 vote, noted that Israel is the only Middle Eastern country that is not party to the Treaty on the Non-Proliferation of Nuclear Weapons. It called on Israel to "accede to that treaty without further delay, not to develop, produce test or otherwise acquire nuclear weapons, to renounce possession of nuclear weapons" and put its nuclear facilities under the safeguard of the U.N.'s International Atomic Energy Agency.

The United States, Canada, Palau and Micronesia joined Israel in opposing the measure, while 18 countries abstained.

Israel is widely considered to possess nuclear arms but declines to confirm it.

The resolution, introduced by Egypt, echoed a similar Arab-backed effort that failed to gain approval in September at the Vienna-based IAEA. At the time, Israel criticized Arab countries for undermining dialogue by repeatedly singling out the Jewish state in international arenas. Israel's U.N. Mission did not immediately return a request for comment Tuesday.

The U.N. resolution, titled "The risk of nuclear proliferation in the Middle East," pushed for the establishment of a nuclear weapons-free zone in the Middle East and lamented that U.S.-backed efforts to convene talks were abandoned in 2012.

Israel has long argued that a full Palestinian-Israeli peace plan must precede any creation of a Mideast zone free of weapons of mass destruction. The country also argues that Iran's alleged work on nuclear arms is the real regional threat. Iran denies pursuing such weapons.

General Assembly resolutions are not legally binding but carry moral weight because it is the only body where all 193 U.N. member states are represented.

U.S. representative Robert Wood, in voting against the resolution at the committee-level last month, said the measure "fails to meet the fundamental tests of fairness and balance. It confines itself to expressions of concern about the activities of a single country."

Wood said the U.S. will continue pushing a Middle East free of weapons of mass destructions, but he warned that such resolutions only undermine prospects for progress.

Credit to Yahoo News

Real Life Hunger Games Plan Revealed

END GAME: U.S. Debt $18 Trillion Dollars