The government continues to assure us that happy days are here again for the U.S. economy and that we don’t have anything to worry about – but should we trust what the CBO is telling us now? Of course not. Instead, perhaps we should listen to some of the men that successfully warned us about the last financial crisis and here is what they have to say. Words: 800
So writes Michael (http://theeconomiccollapseblog.com) in edited excerpts from his original article* entitled Do Wall Street Insiders Expect Something Really BIG To Happen Very Soon?.
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Michael goes on to say in further edited excerpts:
The Congressional Budget Office has just released a report that contains their outlook for the next decade. The report is entitled “The Budget and Economic Outlook: Fiscal Years 2013 to 2023”, and if you want a good laugh you should read it. Here are some of the things that the CBO believes will happen:
- government revenues will more than double by 2023,
- government revenue as a percentage of GDP will rise from 15.8% today to 19.1% in 2023,
- the unemployment rate will continually fall over the next decade,
- the federal budget deficit will fall to just 2.4% of GDP in fiscal year 2015,
- the federal budget deficit will only be $430 billion in 2015,
- we will not have a single recession over the next decade,
- inflation will stay at about 2 percent for the next decade,
- U.S. GDP will grow by a total of 67 percent by 2023.
Wow, all of that sounds great until you go back and take a look at how CBO projections have fared in the past.
In fact, Bruce Krasting has gone back and looked at the numbers from the Congressional Budget Office’s Budget and Economic Outlook 2003. I think that you will find the differences between the CBO projections and what really happened to be very humorous:
- 10-year budget surplus estimate: $5.6T; Reality: $6.6T deficit. A 200+% miss.
- 2012 Debt Held by Public estimate: $1.2T (5% of GDP); Reality: $11.6T. A 1000% miss.
- fiscal 2012 GDP estimate: $17.4T; Reality: $15.8T. A $1.6T (10%) miss.
So should we trust what the CBO is telling us now? Of course not. Instead, perhaps we should listen to some of the men that successfully warned us about the last financial crisis:
- “Dr. Doom” Marc Faber recently stated that he “loves the high odds of a ‘big-time’ market crash” [Read: Dr. Faber and I Concur: There Are Major Reasons to be Very Cautious in 2013 – Here’s What To Do]
- Economist Nouriel Roubini says that we should “prepare for a perfect storm” [Read: Here’s How to Invest – and Thrive – Should Nouriel Roubini’s ‘Perfect Storm’ Engulf Us]
- Pimco’s Bill Gross says that we are heading for a “credit supernova“
- Nomura’s Bob Janjuah believes that the financial markets will experience one more huge spike before collapsing by up to 50% [who says:] I continue to believe that the S&P 500 can trade up towards the 1575/1550 area, where we have, so far, a grand double top. I would not be surprised to see the S&P trade marginally through the 2007 all-time nominal high (the real high was of course seen over a decade ago – so much for equities as a long-term vehicle for wealth creation!). A weekly close at a new all-time high would I think lead to the final parabolic spike up which creates the kind of positioning extreme and leverage extreme needed to create the conditions for a 25% to 50% collapse in equities over the rest of 2013 and 2014, driven by real economy reality hitting home, and by policymaker failure/loss of faith in “their system”. [Read: The S&P 500 Continues to Rapidly Build Its “Domed House” As Projected]
The truth is that no matter how much money printing the Federal Reserve does, it is only a matter of time before the financial markets catch up with economic reality.
The U.S. economy has been in decline for a very long time, and things just continue to get even worse. Here are just a few numbers:
- The percentage of the civilian labor force that is employed has fallen every single year since 2006,
- According to John Williams of shadowstats.com, truly accurate numbers would show that U.S. GDP growth has actually been continuously negative all the way back to 2005,
- U.S. families that have a head of household that is under the age of 30 have a poverty rate of 37 percent,
- One recent survey found that nearly half of all Americans are living on the edge of financial ruin,
- According to the U.S. Census Bureau, there are more than 146 million Americans that are considered to be either “poor” or “low income” at this point.
For many more statistics that demonstrate that the U.S. economy has continued to decline in recent years, please see this article: [U.S. Gov’t Unemployment Deception Masking the Coming Economic Horror Show].
Where is all of this headed?
Well, after the next major financial crisis in America things are going to get very tough. We can get a hint for how things are going to be by taking a look at what is going on over in Europe right now. Can you imagine people trampling each other for food? That is what is happening in Greece….[Read: Will May 2013 Be the End of the Road for the U.S.?]
[Similar] suffering…will come to the U.S. country soon enough so enjoy this false bubble of debt-fueled prosperity while you can. It is going to end way too soon, and after that there will be a whole lot of pain.
Editor’s Note: The author’s views and conclusions are unaltered and no personal comments have been included to maintain the integrity of the original article. Furthermore, the views, conclusions and any recommendations offered in this article are not to be construed as an endorsement of such by the editor.
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