The U.S. economic recovery has been weak and the looming fiscal cliff threatens to act as a further drag on the economy. Europe is imploding with the chances of a ‘Grexit’ increasing, and Spain’s economy deteriorating and risking contagion. David Rosenberg looks at the state of the U.S. and global economy via 51 depressing charts.
So says Mamta Badkar (www.businessinsider.com) in her post here which Lorimer Wilson, editor of www.munKNEE.com (Your Key to Making Money!), presents below. This paragraph must be included in any article re-posting to avoid copyright infringement.
Badkar goes on to say:
Rosenberg writes that the recovery isn’t where it should be saying: “Three years into the aftermath of the worst recession since the 1930s, the global economy still cannot manage to expand organically — that is, without the need for ongoing life support from central banks and governments.”
NOTE: Thanks to Gluskin Sheff for giving us permission to feature David Rosenberg’s charts here.
…The US Government and its catastrophic fiscal morass are now viewed by the world as a ‘safe haven’. This would easily qualify for a comedy shtick if it weren’t so serious….[but] the establishment is thrilled with these developments because it helps maintain the status quo of the dollar standard era. However, there are some serious ramifications that few are paying attention to and are getting almost zero coverage from traditional media. [Let me explain what they are.] Words: 1150
Jim Sinclair is now warning… that ‘The end is not near, it is here and now’ in reference to the global financial system…[and] reiterating his long held view that there will be “QE to infinity” despite the denials of Bernanke and other central bankers. [He also has some interesting things to say about gold and alarming things to say about the euro. Read on.] Words: 305
“Either you take the debt clean-out right away, and that means a very hard deflationary depression, or you do what I suspect they will try to do and that is keep pumping money into the system to keep the whole banking (system), derivatives and economies afloat [and] that will lead to some sort of monetary distress that could end in hyperinflation. I think that’s the worst outcome, but there is no good outcome.”
Even as I write these words, the world’s largest economy — the E.U. — is coming unglued at the seams, the world’s second largest — the U.S. — is careening headlong toward a fiscal cliff that promises to gut its GDP, nearly all of Asia — including Japan, China and India — is slowing…and yet most investors still don’t get the message. [Let me go on to explain just what that message is.] Words: 1357
On the heels of Spain asking for $125 billion to bail out their collapsing banking system…there will be a massive worldwide package coming out between the Fed, the ECB, the IMF and other central banks. The money printing is imminent. As I see things, we are on the road to perdition,…there is no exit strategy for the world (to get) out of these problems. There is no solution. If you look at what happened in 2008, people thought that was bad, but what’s going to happen, starting this year and in the next few years, will make 2008 look like a small rehearsal because the real collapse is going to start now.
I think it’s important that everybody has a reasonable allocation of gold in their portfolio because…we could be just a few months away from something that is really very scary, and if that happens, gold will go a lot higher.
For the past four years I have been covering the progression of the global economic crisis with an emphasis on the debilitating effects it has had on the American financial system. Only once before have I ever issued an economic alert, and this was at the onset of the very first credit downgrade in U.S. history by S&P. I do not take the word “alert” lightly. [Read on to to understand why I have issued an economic alert once again.] Words: 1904
Currency wars arise when a country steals growth from trading partners by cheapening its currency to promote exports. The new currency war began in 2010 when President Obama declared in his State of the Union address that it was the policy of the United States to double exports in five years. Since the U.S. would not become twice as productive in five years, the implication was the U.S. would severely cheapen its currency to achieve this goal. [Let me expand upon this.] Words: 666
The economy is now so manipulated by politicians, big bankers, and special-interest groups that making sense of the markets has become an almost impossible feat. Which is to say, it must push even harder on the levers of its printing presses, further setting the stage for the massive period of inflation we continue to see as inevitable… and for a stunning rise in interest rates. Words: 968
Why are both debtors and creditors willing to build a status quo of massive unprecedented debt? [After all, the delusions of] creditors that debt is wealth and should never be liquidated, and of debtors that debt is an easy or free lunch have been smashed by the juggernaut of history many times before…[and] I think they will soon be smashed again. [Let me explain.] Words: 1150
The deficits aren’t going to stop anytime soon. The debt mountain will keep growing…Obviously, the debt can’t keep growing faster than the economy forever, but the people in charge do seem determined to find out just how far they can push things….The only way for the politicians to buy time will be through price inflation, to reduce the real burden of the debt, and whether they admit it or not, inflation is what they will be praying for….[and] the Federal Reserve will hear their prayer. When will the economy reach the wall toward which it is headed? Not soon, I believe, but in the meantime there will be plenty of excitement. [Let me explain what I expect to unfold.] Words: 1833
When the supply of something is increased sharply relative to demand, the value of that commodity will decline. If the supply continues to increase rapidly and indefinitely, then that item will become worth less and less, with the potential to finally become nearly worthless. This is the Developing Disaster facing the US Dollar and the world. This is the factor that could become the single most important criterion in investment allocation decisions and possibly even for individual financial survival…[Let me explain this further by reviewing the 7 major problems facing the U.S. (and thus the world) and how they all will lead to problem #7 – devolution.] Words: 1520
“An essential point in the social philosophy of interventionism is the existence of an inexhaustible fund which can be squeezed forever. The whole system of interventionism collapses when this fountain is drained off: The Santa Claus principle liquidates itself.” [This article discusses the reality of the current economic crisis and] what is required to revive the economy. Words: 1666
Today’s western financial world operates much like government-sponsored medical systems. Mask the problem and give the bankers the pharmaceutical drugs (bail out money) to help them dull the pain and keep them on life support. Letting the free markets work in curing the ailment is not an option because then there would be little need for doctors (governments) or the manufacturers of these drugs (central banks). The banks are sick and should be allowed to pass on…so the virus known as debt does not affect the rest of the population. Unfortunately, the governments and central bankers have only one prescription drug of choice to keep them alive [and that seems to be the supposed cure-all of] printing money… [Let me explain further.] Words: 970
The developed economies of the world have opened the money spigots…[and this] massive money and credit creation is sitting in the banking system like dry tinder just waiting for a spark to set it ablaze. How quickly it happens is anyone’s guess, but once it does we are likely to be enveloped in a worldwide inflation unlike anything before ever witnessed. [Let me explain further.] Words: 625
The U.S. economy is in an intensifying inflationary recession that eventually will evolve into a hyperinflationary great depression… [at which time] a $100 bill in the United States will become worth more as functional toilet paper/tissue than as currency. The U.S. government and Federal Reserve already have committed the system to this course through the easy politics of a bottomless pocketbook, the servicing of big-moneyed special interests, and gross mismanagement. The article is long but well worth the read. Words: 3565
The economic condition of the country continues to decline toward its rendezvous with an, as yet, unknowable catastrophe. Here is… a look (not a prediction) at a series of not improbable events that could develop [and which] would change our economic world overnight. Words: 1550