Fear Of The Coronavirus Has Absolutely Destroyed America’s Future

Very few people are talking about it, and even fewer are bothering to object, but by borrowing and spending so much money our politicians are essentially feeding America’s financial future into a wood chipper.  It took from the founding of our country all the way to 1981 before the U.S. national debt reached one trillion dollars.  Incredibly, we just added more than a trillion dollars to our national debt in less than a month.  On April 5th, we were 23.9 trillion dollars in debt, and by May 4th we were 25 trillion dollars in debt.  Fear of the coronavirus has caused nearly all of our politicians to suddenly become socialists, and we are being told that trillions more in spending may be coming.  This is complete and utter lunacy, and we are leaving future generations of Americans with a mountain of debt that would absolutely crush them.  But of course our society may not even last too much longer at the rate we are going.  For years I have been loudly warning that our absurd national debt is an existential threat to America’s future, but at this point both major political parties have completely abandoned any sense of fiscal responsibility.  Now our national debt is rapidly speeding toward the 26 trillion dollar mark, and the House of Representatives just passed a bill that would borrow and spend an additional 3 trillion dollars that we do not currently have…

Last week, House Democrats unveiled their latest pandemic-relief package. The bill combines aid for families, a bailout for struggling cities and states, and additional funds for testing, tracing, and hospitals. The price tag is about $3 trillion—and it comes just weeks after the president signed an economic-relief package worth about $2 trillion.

Since we are destroying the nation anyway, why don’t we make the grand total a nice round 10 trillion dollars like the progressives at the Atlantic are suggesting?

After all, we added close to 10 trillion dollars to the national debt during the Obama years and hardly anyone seemed to mind.

Of course Trump is trying to outdo Obama.  We have already added more than 5 trillion dollars to the national debt while he has been in office, and it looks like more “coronavirus relief bills” could be on the way.

Yes, borrowing and spending money that we do not have gives us an economic boost in the present.

But it is also money that we are stealing from future generations, and we are systematically destroying the bright future that they were supposed to have.

Since Barack Obama’s first day in the White House, we have been stealing an average of more than 100 million dollars from our children and our grandchildren every single hour of every single day.

And under Trump, that pace has actually increased.

I know that figure is difficult to believe, but run the numbers yourself and you will see that I am correct.

What we are doing to future generations is beyond criminal, and it should make every American deeply angry.

But instead, many Americans are convinced that we aren’t spending enough.

In fact, Mark Cuban believes that the government should be issuing $1,000 checks to each household every two weeks

The federal government has already sent a one-time check of up to $1,200 to millions of American families, but according to Mark Cuban, the stimulus is not enough to offset the economic pain of the coronavirus pandemic.

The billionaire entrepreneur proposed the government issue $1,000 checks to every American household every two weeks for the next two months, with the caveat that the money must be spent within 10 days of receipt or it expires. It would cost about $500 billion, Cuban estimated.

Everybody knows that you should never go full Weimar Republic, but since we are essentially doing that already, why not make it $10,000 for every household every two weeks?

After all, $1,000 doesn’t go as far as it once did.  These days, you can blow $1,000 in a single trip to the grocery store.

Of course I am being facetious.  We are literally watching our leaders destroy everything that all previous generations of Americans fought so hard to build, and it is absolutely infuriating.

At this point even the ultra-liberal Washington Post is admitting that “the national debt is out of control”, but of course the Post also keeps on promoting ultra-liberal spending policies.

We are like a morbidly obese guy that can’t even fit in his own bathtub anymore because he is so addicted to food.  Our addiction is debt, and no matter how loud the warnings get we are just going to keep going back for more.

Ultimately, the only way that the U.S. is going to be able to service this exploding debt is to wildly devalue the currency.  This is the road that the Weimar Republic, Venezuela and so many others have gone down, and it always ends in utter disaster.

Only this time the biggest economy on the entire planet is doing it, and the currency that we are devaluing is the reserve currency of the world.

Sadly, there is no turning back now.  Both political parties are completely committed to this course, and the mainstream media is fully behind them.  In fact, CNN insists that “now is not the time to cut back on the borrowing”.

So when will be the time to cut back on borrowing?

If we need to add trillions to the national debt to deal with a relatively minor crisis like this coronavirus pandemic, what in the world are we going to do when really bad stuff starts happening?

Last November, I was absolutely horrified when our national debt hit the 23 trillion dollar mark.  But by the time this November rolls around, we might be at the 27 or 28 trillion dollar mark.

Unfortunately, we throw the word “trillion” around so much these days that most Americans don’t even realize how much money a trillion dollars actually is.

If you would have been spending a million dollars every single day since Jesus was born, you still would not have spent a trillion dollars by now.

We are talking about an amount of money that is absolutely unimaginable, and we just added that much money to the national debt in less than a month.

Thanks to our free spending politicians and everyone that is supporting them, there is now no future for this country.

We are literally committing national suicide in front of the whole world, but we are so utterly consumed by our addiction that we don’t even realize that we should be deeply ashamed of ourselves.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse BlogEnd Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The EndGet Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with all many people as we possibly can.

5 More Signs That The Global Economy Is Careening Toward A Recession

The global economy is already in the worst distress that we have seen since 2008, and it appears that the global slowdown is actually picking up pace as we head into 2020. And this is happening even though central banks around the world have been cutting interest rates and pumping massive amounts of money into their respective financial systems. The central bankers appear to be losing control, and it certainly wouldn’t take much of a push for this new crisis to evolve into a complete and utter nightmare. The U.S. economy hasn’t been hit quite as hard as economies in Asia and Europe have been, but without a doubt things are slowing down here too. Corporate earnings have been falling quarter after quarter, auto loan delinquencies just hit a record high, the Cass Freight Index has declined for 11 consecutive months, and we just witnessed the largest drop for U.S. industrial production since 2009. Everywhere around us there is bad economic news, but most Americans are still completely oblivious to what is happening.

In this article, I am going to share even more evidence that a global economic slowdown has already begun. When you add these numbers to all of the other numbers that I have been sharing in recent weeks, it becomes impossible to deny that something major is taking place.

The following are 5 more signs that the global economy is careening toward a recession…

#1 It is being projected that global auto sales will be down approximately 4 percent this year. According to CNN, this will be the second consecutive year that global auto sales have fallen…

With only a month left in the year, global auto sales are on track for a 3.1 million drop, about 4%, for the year, according to Fitch. That would be the biggest decline since 2008, when the financial crisis hit, and the second year in a row that sales have fallen. Fitch expects worldwide car sales to total 77.5 million in 2019.

#2 Global trade just keeps falling. According to Zero Hedge, total global trade has now declined on a year over year basis for four months in a row…

Global trade on a YoY basis contracted by 1.1% in September, marking the fourth consecutive YoY declines and the most extended period of subdued trade since the financial crisis in 2009.

The CPB said supply chain disruptions between the US and China, due mostly to the trade war, were the most significant drag on international trade volumes. US volumes fell 2.1% in September MoM. Though in China, imports plunged 6.9% MoM.

As you can see from those first two examples, we keep witnessing things happen that we haven’t seen since the last financial crisis. Over the past few months, I have used phrases such as “since 2008” and “since 2009” over and over again. We literally have not seen economic numbers this bad since the last recession, and we are still in the very early phases of this new downturn.

And in some cases, the numbers are actually even worse than anything that we saw during the last recession, and that brings us to our next sign…

#3 Chinese industrial profits just fell by the largest percentage ever recorded

China Industrial Enterprises total profits collapsed in October to CNY427.5bn from CNY575.6bn in September – a 9.9% YoY plunge, the biggest drop on record.

In fact, China’s Industrial sector has seen annual declines in its profits for 4 of the last 6 months.

The trade war has hit the Chinese economy really hard, but it doesn’t look like a trade deal will happen any time soon.

#4 U.S. consumer confidence has now fallen for four months in a row

Consumer confidence dipped for a fourth straight month in November as economic conditions weaken toward the end of 2019, data released Tuesday by The Conference Board shows.

The board’s consumer confidence index dipped to 125.5 this month. That’s down from 126.1 in October. Economists polled by Dow Jones expected the index to rise to 126.6.

This wasn’t supposed to happen, and if it keeps happening that is going to have important implications for the 2020 election.

#5 Even the wealthy are cutting back on their spending. According to Yahoo Finance, this is a continuation of a trend that we have been seeing for the past three quarters…

Spending by the top 10% fell 1% in the second quarter from the same period last year, according to an analysis of Federal Reserve data by Moody’s Analytics. And a four-quarter average of outlays by the high earners has slipped on an annual basis the past three quarters, marking the first such declines since the Great Recession of 2007-09.

In recent years, global central banks have engaged in unprecedented intervention in an attempt to stave off another crisis, and for a while their efforts appeared to be successful.

But just because the coming crisis was delayed does not mean that it was canceled.

In fact, over the past few years our long-term financial problems have actually gotten a lot worse. We are facing the biggest debt bubble in the history of the planet, global financial markets are more primed for a crash than they have ever been before, and civil unrest is breaking out all over the world. The stage is certainly set for “the perfect storm” that I keep talking about, and most Americans have absolutely no idea what is coming.

In all the time that I have been writing about the global economy, things have never looked more ominous then they do right now.

So buckle up and hold on tight, because it certainly looks like we are in for a very bumpy ride in the months ahead.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. This article may contain opinions on political matters, but it is not intended to promote the candidacy of any particular political candidate. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.

Black Friday Is Coming, And 48 Million Americans Still Have Holiday Debt From Last Year

The biggest shopping day of the year is almost here, and marketers are working hard trying to extract as much money from U.S. consumers as possible. Unfortunately, it is becoming increasingly difficult to get consumers to open up their wallets, because many of them are already drowning in debt. As a society, we have been trained to think of this as “the happiest time of the year”, and for many Americans the most important part of the holiday season is opening presents on Christmas morning. So there is a tremendous amount of pressure to spend a lot of money on presents, but this often leads to high levels of credit card debt. In fact, a survey that was just released discovered that 48 million Americans “are still paying off credit card debt from last holiday season”

The holidays can be hard: cooking elaborate meals, facing frigid temperatures, making travel plans that please everyone.

Overspending, however, is too easy. In fact, about 48 million Americans are still paying off credit card debt from last holiday season, according to a NerdWallet survey conducted by The Harris Poll.

Sadly, some of those consumers will end up paying the credit card companies more than twice what those Christmas presents originally cost, and it can be exceedingly difficult to ever get ahead when you are trapped in a seemingly endless cycle of debt.

So why do people do it?

Well, according to one financial therapist many Americans are chasing an “emotional experience” this time of the year…

Gift-buying requires money, time and energy when you may already feel overwhelmed, says Los Angeles-based financial therapist Amanda Clayman. During the holidays, “we’re chasing a sort of emotional experience,” she says. Think: the love and happiness of a Hallmark movie.

But feelings of grief or longing may be more realistic. “This is a sad and lonely time for many people,” says Sarah Newcomb, behavioral economist for Morningstar. Shopping (for anything or everything) can be a convenient coping mechanism.

We want what we see on television, but what we see on television is not real.

In the end, many Americans leave the holiday season feeling deeply disappointed, because what they were chasing was just an illusion.

Yes, some wealthy families will literally have hundreds of presents under their Christmas trees this holiday season, but most American families are deeply struggling these days.

In fact, over two million of us are actually living without basic necessities such as “running water or indoor plumbing”. The following comes from Daisy Luther

A new report says that more than 2 million Americans in West Virginia, Alabama, Texas and the Navajo Nation Reservation in the Southwest are living without clean running water or indoor plumbing. They’re drinking from polluted streams. They’re carrying buckets of the same water home for washing. They’re urinating and defecating outside with no wastewater treatment.

The gap between the rich and the poor continues to grow, and at this point the wealthiest 0.1 percent of all Americans now have as much wealth as the poorest 90 percent of all Americans combined.

Let that sink in for a moment.

That is a recipe for societal disaster, and it is getting worse with each passing year.

A big reason for this is because the Federal Reserve has been artificially pumping up the financial markets, and on Monday stocks hit yet another all-time high

The S&P 500 and Nasdaq Composite hit all-time closing highs as they rose 0.8% to 3,133.64 and 1.3% to 8,632.49, respectively. Both indexes also notched intraday records. The Dow Jones Industrial Average also had a record close, gaining 190.85 points, or 0.5% to 28,066.47.

President Donald Trump tweeted about the record, saying: “Enjoy!”

But what most Americans don’t understand is that 84 percent of all stock market wealth is owned by the wealthiest 10 percent of all Americans.

Of course the stock market bubble won’t last indefinitely. We are already in an earnings recession, and that earnings recession is expected to continue in the fourth quarter

Earnings in the S&P 500 index SPX, +0.75% are now projected to decline 1.51% in the fourth quarter from the year before, according to a FactSet computation of analysts’ average forecasts for individual companies. An earnings recession is defined as two quarters or more of consecutive year-over-year declines, and earnings for S&P 500 components dipped in the first two quarters of 2019 and are all but certain to do so again in the third quarter — with nearly 95% of calendar third-quarter reports posted, earnings have dropped 2.34%, the biggest decline so far this year.

And about 75 percent of the time, an earnings recession leads into a full-blown recession for the economy as a whole

Three-fourths (75%) of earnings recessions since World War II have morphed into economic recessions, said CFRA Chief Investment Strategist Sam Stovall, who told Market Watch that he has been “scratching his head” trying to reconcile analyst pessimism around earnings with continued stock-market rallies.

So the truth is that those that are celebrating what the stock market is doing are not likely to be celebrating for too much longer.

And every day we continue to get more bad news from the real economy. For example, we just learned that the largest maker of truck engines in the United States will be laying off about 2,000 workers

Those market trends are now impacting Cummins, a Columbus, Ind., manufacturer of heavy equipment. It’s the largest manufacturer of Class 8 truck engines, claiming a 38.3% market share in 2018 over competitors like Daimler and Volvo/Mack.

Cummins spokesperson Jon Mills confirmed to Business Insider that the company, which employs some 62,610 globally, will reduce its global workforce by about 2,000. Those layoffs will be complete by the first quarter of 2020, he said.

As a “perfect storm” overtakes America, many believe that this will be the last “normal” holiday season that Americans will be able to enjoy.

It has become exceedingly clear that very hard times are coming, and quite a few experts believe that the crisis that is ahead will be even worse than what we experienced in 2008.

So enjoy the time that you are able to spend with your family and friends over the coming weeks, because major changes are already starting to happen, and our nation will soon be dealing with one major headache after another.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. This article may contain opinions on political matters, but it is not intended to promote the candidacy of any particular political candidate. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.

Brace For Impact! The U.S. Economy Is Going Down, And It Is Going Down Hard…

I have so many bad economic numbers to share with you that I don’t even know where to start. I had anticipated that the U.S. economic slowdown would accelerate during the fourth quarter of 2019, and that is precisely what has happened. The Federal Reserve is trying to do all that it can to keep us from officially slipping into a recession, and the federal government is literally spending money as if tomorrow will never come, but all of that intervention has not been enough to reverse our economic momentum. We are really starting to see conditions begin to deteriorate very rapidly now, and 2020 is already shaping up to be the most pivotal year for the U.S. economy since 2008.

Let me start my analysis by discussing how U.S. consumers are doing right now. According to CBS News, a major new study that was just released found that 70 percent of all Americans are struggling financially…

Many Americans remain in precarious financial shape even as the economy continues to grow, with 7 of 10 saying they struggling with at least one aspect of financial stability, such as paying bills or saving money.

The findings come from a survey of more than 5,400 Americans from the Financial Health Network, a nonprofit financial services consultancy. The project, which started a year ago, is aimed at assessing people’s financial health by asking about debt, savings, bills and wages, among other issues.

That sure doesn’t sound like a “booming economy”, does it?

And even though things are already really tough for millions upon millions of American families, it appears that things are rapidly getting worse. In fact, we just witnessed the largest decline for the Bloomberg Consumer Comfort Index since 2008

Despite stocks soaring to record highs, The Bloomberg Consumer Comfort index fell last week to 58.0 from 59.1 a week earlier, and has now plunged 5.4 points in three weeks, the biggest such drop since 2008

Yes, the employment situation in this country is still relatively stable for the moment, but the truth is that most of the “jobs” that have been “created” in recent years actually pay very little. If you can believe it, 58 million jobs in the United States currently pay less than $793 a week

There are now roughly 105 million production and nonsupervisory jobs in the U.S. That’s 83 percent of all private sector jobs. And more than half of them — 58 million — pay less than the average weekly U.S. wage of $793. Many of these jobs don’t offer health care or other benefits.

These are the best jobs that many Americans can find and the most hours they can get.

And I discussed in a previous article, 50 percent of all U.S. workers currently make less than $33,000 a year.

In recent years, many families have increasingly turned to debt in order to maintain their “middle class lifestyles”, but now a lot of those debts are starting to go bad.

In fact, the New York Fed just announced that serious auto loan delinquencies in the United States have hit a brand new record high. The following comes from Wolf Richter

Serious auto-loan delinquencies – auto loans that are 90 days or more past due – in the third quarter of 2019, after an amazing trajectory, reached a historic high of $62 billion, according to data from the New York Fed today

Do you remember the subprime mortgage meltdown of 2008?

Well, a very similar thing is happening right now with auto loans.

Meanwhile, the bad economic numbers just keep rolling in. Here are a few new data points that we have gotten since my last article…

-We just witnessed the worst decline for U.S. industrial production since 2009.

-The Cass Freight Index has just fallen for the 11th month in a row.

-Sears has announced that they will be laying off hundreds of workers as they continue to close stores at a very rapid pace.

At this point, it is going to be a real challenge to keep U.S. GDP growth above zero for the fourth quarter. If you can believe it, the latest forecast from the Atlanta Fed is projecting a fourth quarter growth rate of just 0.3 percent…

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the fourth quarter of 2019 is 0.3 percent on November 15, down from 1.0 percent on November 8. After this morning’s retail trade releases from the U.S. Census Bureau, and this morning’s industrial production report from the Federal Reserve Board of Governors, the nowcasts of fourth-quarter real personal consumption expenditures growth and fourth-quarter real gross private domestic investment growth decreased from 2.1 percent and -2.3 percent, respectively, to 1.7 percent and -4.4 percent, respectively.

That is terrible.

We aren’t talking about 3 percent. They are projecting growth of “0.3 percent”, and if we slip below zero we could actually be in the beginning of a recession right now without even realizing it yet.

The Federal Reserve has been attempting to bolster the economy by cutting interest rates and by pumping massive amounts of money into the financial system. They are telling us that this new round of money creation is “not QE”, but from the very beginning I have been pointing out that it really is more quantitative easing, and many in the financial world are starting to acknowledge this reality

After a month of constant verbal gymnastics (and diarrhea from financial pundit sycophants who can’t think creatively or originally and merely parrot their echo chamber in hopes of likes/retweets) by the Fed that the recent launch of $60 billion in T-Bill purchases is anything but QE (whatever you do, don’t call it “QE 4”, just call it “NOT QE” please), one bank finally had the guts to say what was so obvious to anyone who isn’t challenged by simple logic: the Fed’s “NOT QE” is really “QE.”

In a note warning that the Fed’s latest purchase program – whether one calls it QE or NOT QE – will have big, potentially catastrophic costs, Bank of America’s Ralph Axel writes that in the aftermath of the Fed’s new program of T-bill purchases to increase the amount of reserves in the banking system, the Fed made an effort to repeatedly inform markets that this is not a new round of quantitative easing, and yet as the BofA strategist notes, “in important ways it is similar.”

But as I discussed earlier, all of the Fed’s efforts are not working.

No matter how hard they try, they have not been able to reverse our economic momentum.

And many people believe that what we have seen so far is just the tip of the iceberg. In fact, trends forecaster Gerald Celente is convinced that we are heading for “the Greatest Depression”

You think you have a crisis in a country near you now? You haven’t seen anything. When the Greatest Depression hits, people are going to be escaping violence, poverty, corruption — civil wars are happening in front of everybody’s eyes. And you think you’ve got a homeless problem in a city near you? You haven’t seen anything. You are going to see homeless everywhere. This is out of control and it’s going to only get worse as the global economy slows down…

And you know what?

He’s right.

What is coming is going to make 2008 look like a Sunday picnic, and our society is completely and utterly unprepared for what is about to happen.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. This article may contain opinions on political matters, but it is not intended to promote the candidacy of any particular political candidate. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.

The U.S. National Debt Just Hit The 23 Trillion Dollar Mark As We Continue To Steamroll Toward Financial Oblivion

This week, the U.S. national debt reached the 23 trillion dollar mark for the first time ever. There was no fanfare, there were no politicians giving speeches about fiscal responsibility, and there has been very little national outrage. We have simply come to accept that it is “normal” for our national debt to grow at an exponential rate, but the truth is that we are literally committing national suicide. Given enough time, there is no doubt that this colossal mountain of debt will kill our Republic, and yet fiscal responsibility is not even a major national issue any longer. Everyone seems to be okay with the fact that we are stealing more than 100 million dollars every single hour of every single day from future generations of Americans and destroying the bright future that they were supposed to have. What we are doing to our children and our grandchildren is beyond criminal, and yet very few of us seem to care.

At this point things are so bad that even Fed Chair Jerome Powell is warning Congress that the national debt is a major problem

Federal Reserve Chairman Jerome Powell warned lawmakers Wednesday that the ballooning federal debt could hamper Congress’ ability to support the economy in a downturn, urging them to put the budget “on a sustainable path.”

Powell suggested such fiscal aid could be vital after the Fed has cut its benchmark interest rate three times this year, leaving the central bank less room to lower rates further in case of a recession.

When a major downturn hits the U.S. economy, the federal government is not going to be able to do much because we are already spending money at emergency levels.

Of course Powell shouldn’t exactly be criticizing Congress, because the Fed has already been using up all of their ammunition too.

So when the next recession officially arrives, the amount of intervention that will be possible will be very limited.

Since Barack Obama’s inauguration, we have been adding an average of more than a trillion dollars to the national debt every year. That is utter insanity, but it has helped the economy in the short-term.

When the federal government borrows money that it does not have and spends it into the economy, that boosts economic activity. But at the same time it makes our long-term financial problems even worse.

If we were to go back and remove from the economy the 12.4 trillion dollars that the federal government added to our national debt since Obama’s inauguration, we would be in the deepest economic depression in American history right now.

So all of that reckless spending has kept us from economic disaster, but it has set the stage for something even worse when this bubble finally bursts.

In October, the federal government’s budget deficit for the month was $134.5 billion. That was 34 percent higher than for the same month a year earlier.

I can’t even begin to describe how foolish this is. The extreme negligence being committed by our politicians in Washington is mind blowing.

And this is just the beginning of our problems. As our population ages, Social Security, Medicare and other entitlement programs are going to become rapidly more oppressive

This is only going to get worse. According to Census Bureau projections, by 2030 each 100 working-age Americans will be supporting 35 retirees, and this could rise to 42 by 2060. Another way to think of this is to calculate the number of retirees each worker must support. In 1946, the burden of one retiree was shared between 42 workers. Today, according to the SSA, roughly three workers cover each retiree’s Social Security and Medicare benefits. By 2030, however, there will be only two workers supporting each retiree.

So where are we going to get the money that we need to support those programs?

Of course we aren’t actually going to make it to 2060. Our entire system will implode long before then.

Consumers have also been on a tremendous debt binge in recent years, and we just learned that total U.S. household debt is about to cross the 14 trillion dollar mark

Americans increased their borrowing for the 21st straight quarter as more households took out loans to buy homes or refinance existing mortgages, according to a report released today from the Federal Reserve Bank of New York.

Total U.S. household debt rose $92 billion, or 0.7%, to $13.95 trillion in the third quarter, the New York Fed’s quarterly household credit and debt report showed.

We are in the final stages of the biggest debt bubble in the history of the world, and most of us realize that this chapter in our history is going to end very badly.

So why do we just keep making things worse?

Of course it isn’t just the United States that is drowning in debt. According to the IMF, total global debt has now reached the 188 trillion dollar mark…

The global debt crisis has reached epic and historical proportions. It’s now $188 trillion, which is more than double the entire economic output of the entire planet.

The global debt load has surged to a new record of around 230% of the world’s output, IMF chief Kristalina Georgieva said according to a report by the Daily Mail. The entire globe’s economic stability is hanging by a thread, and this news makes that thread appear just a little thinner.

Most people don’t understand that the global financial system has literally been designed to create as much debt as possible. But once you grasp this, it shouldn’t actually be a surprise that we are now 188 trillion dollars in debt. The system is simply doing what it was intended to do. For much more on this, please see my previous article entitled “Global Debt Is Up To $188,000,000,000,000 – This Is Officially The Biggest Debt Bubble The World Has Ever Seen”.

For decades, we have been ignoring the future consequences of running up so much debt, but at some point time is going to run out.

In a recent article, Ron Paul put it this way

Even though the federal deficit is already over one trillion dollars (and growing), President Trump and Congress have no interest in cutting spending, especially in an election year. Should he win reelection, President Trump is unlikely to reverse course and champion fiscal restraint. Instead, he will likely take his victory as a sign that the people support big federal budgets and huge deficits. None of the leading Democratic candidates are even pretending to care about the deficit. Instead they are proposing increasing spending by trillions on new government programs.

Joseph Zidle, a strategist with the Blackstone investment firm, has called the government — or “sovereign” — debt bubble the “mother of all bubbles.” When the sovereign debt bubble inevitably busts, it will cause a meltdown bigger than the 2008 crash.

As usual, Ron Paul is right on the mark.

And actually “a meltdown bigger than the 2008 crash” would be a best case scenario.

Ultimately, it is extremely doubtful that we are going to be able to survive what is going to happen to us once this bubble completely bursts.

The Republic that previous generations of Americans sacrificed so much to build is being systematically destroyed, and it is our own greed that is doing it.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. This article may contain opinions on political matters, but it is not intended to promote the candidacy of any particular political candidate. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.

Guess Who Is Preparing For A Major Stock Market Crash?

Pessimism is spreading like wildfire on Wall Street, and this is particularly true among one very important group of investors. And considering how much money they have, it may be wise to listen to what they are telling us. According to a very alarming survey that was recently conducted by UBS Wealth Management, most wealthy investors now believe that there will be a “significant” stock market decline before the end of next year. The following comes from Yahoo Finance

Wealthy people around the globe are hunkering down for a potentially turbulent 2020, according to UBS Global Wealth Management.

A majority of rich investors expect a significant drop in markets before the end of next year, and 25% of their average assets are currently in cash, according to a survey of more than 3,400 global respondents. The U.S.-China trade conflict is their top geopolitical concern, while the upcoming American presidential election is seen as another significant threat to portfolios.

Of course this could ultimately become something of a self-fulfilling prophecy if enough wealthy investors pull their money out of stocks and start increasing their cash reserves instead. Nobody wants to be the last one out of the barn, and it isn’t going to take too much of a spark to set off a full-blown panic. Perhaps the most troubling number from the entire survey is the fact that almost 80 percent of the wealthy investors that UBS surveyed believe that “volatility is likely to increase”

Nearly four-fifths of respondents say volatility is likely to increase, and 55% think there will be a significant market sell-off before the end of 2020, according to the report which was conducted between August and October and polled those with at least $1 million in investable assets. Sixty percent are considering increasing their cash levels further, while 62% plan to increase diversification across asset classes.

During volatile times for the market, stocks tend to go down.

And during extremely volatile times, stocks tend to go down very rapidly.

Could it be possible that many of these wealthy investors have gotten wind of some things that the general public doesn’t know about yet?

Of course the truth is that anyone with half a brain can see that stock valuations are ridiculously bloated right now and that a crash is inevitable at some point.

And as I noted yesterday, corporate insiders are currently selling off stocks at the fastest pace in about two decades.

But why is there suddenly so much concern about 2020?

A different survey of business executives that was recently conducted found that 62 percent of them believe that “a recession will happen within the next 18 months”

A majority of respondents – 62% – believe a recession will happen within the next 18 months. Private companies are particularly worried that a recession lurks in the near term, with 39% anticipating a recession in the next 12 months. This compares with 33% of public company respondents who felt the same way. About one-quarter – 23% – of respondents do not expect a recession within the next two years.

62 percent is a very solid majority, and without a doubt we are starting to see businesses pull back on investment in a major way.

In fact, according to Axios business investment in the United States has now dropped for six months in a row…

  • Business investment has fallen for six months straight and declined by 3% in the third quarter, the largest drop since 2015.
  • The retrenchment by businesses helped turn Wednesday’s U.S. workforce productivity report — a key economic metric that compares goods-and-services output to the number of labor hours worked — negative for the first time in four years.

I know that I bombard my readers with numbers like this on an almost daily basis, but I cannot stress enough how ominous the economic outlook is at this point.

And it isn’t just the U.S. that we need to be concerned about. Two other surveys that measure the business outlook for the entire globe just fell to their lowest levels in a decade

The IHS Markit global business outlook—which surveys 12,000 companies three times a year—fell to the worst level since 2009, when data was first collected.

The Ifo world economic outlook, which surveys 1,230 people in 117 countries, fell in the fourth quarter to the worst level since the second quarter of 2009.

Markit’s poll found optimism for activity, employment and profits in the year ahead were all at the lowest level since the financial crisis. Markit also reported a decline in planned investment spending, with inflation expectations at a three-year low.

It is really happening.

The global economy really is heading into a major downturn.

And once this crisis really gets rolling, it is going to be exceedingly painful.

All across America, big companies are already starting to go under at a pace that is absolutely frightening. For instance, on Tuesday one of the biggest dairy companies in the entire country filed for bankruptcy

Dairy giant Dean Foods filed for Chapter 11 bankruptcy protection as declining milk sales take a toll on the industry.

Dean Foods – whose more than 50 brands include Dean’s, Land O’ Lakes and Country Fresh – said it intends to continue operating.

The company said it “is engaged in advanced discussions” for a sale to Dairy Farmers of America, a national milk cooperative representing farmers, producers and brands such as Borden cheese and Kemps Dairy.

I have quite a few relatives in Minnesota, and I have always had a soft spot for Land O’Lakes butter. So it definitely saddened me to hear that this was happening.

But a lot more major casualties are coming.

Of course the economic optimists will continue to insist that we are just experiencing a few bumps on a path that leads to a wonderful new era of American prosperity. They will continue to tell us of a great “financial harvest” that is about to happen even when things are falling apart all around us.

You can believe them if you want, but most wealthy investors and most business owners believe that hard times are dead ahead.

I have never seen so much pessimism about a coming year as I am seeing about 2020 right now.

There is a growing national consensus that it is going to be a very chaotic year, and I would recommend using what little time you have left to get prepared for it.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. This article may contain opinions on political matters, but it is not intended to promote the candidacy of any particular political candidate. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.

If Impeachment Fails, Will The Elite Crash The Economy In Order To Prevent Four More Years Of Trump?

By now, it is exceedingly obvious that the global elite absolutely hate Donald Trump. No president in U.S. history has faced such a relentless assault by the corporate media, and there have been attempts to sabotage his presidency at every turn. Miraculously, Trump has survived all of these attacks so far, but now the specter of impeachment looms large over his administration. The Democrats have a solid majority in the U.S. House of Representatives, they are working quickly toward drafting articles of impeachment, and they actually hope to have Trump impeached by Christmas Day. But in order to have Trump removed from office, 67 votes will be needed in the Senate, and right now Democrats only control 47 of those seats. It was always going to be tough for Democrats to get 20 Republicans in the Senate to turn on Trump, but they have bungled this process so badly that they might not end up getting any at all.

That scenario will become even more likely if House Republicans stand solidly united behind Trump, and at this point even the Washington Post is admitting that there is a possibility “that not a single House Republican” will vote for the articles of impeachment…

Congressional Republicans are sticking with their party leader in the face of thousands of pages of evidence showing President Trump leveraged foreign policy for political favors, raising the possibility that not a single House Republican will vote for his impeachment.

Of course it will only take a simple majority to impeach Trump in the House, and Democrats will be able to do that with no problem, but it appears that the effort to remove Trump will be completely dead when it gets to the Senate.

Yes, things could still change and this is a very fluid situation, but as things stand today it seems that Trump is safe.

So what are the elite going to do if impeachment fails?

They are facing the prospect that Trump could actually win again in 2020, and that would mean that he would remain in the White House until January 2025.

For many among the elite, such a scenario must be avoided at all costs. And the quickest way to get the general public to turn on any president is for the economy to crumble.

This is one of the reasons why some prominent voices on the left have been openly wishing for a recession. For example, just check out what Bill Maher said not too long ago

“I’ve been saying for about two years that I hope we have a recession and people get mad at me,” said Maher, a multimillionaire who would likely be well insulated from a financial downturn.

“I’m just saying we can survive a recession,” he continued. “We’ve had 47 of them. We’ve had one every time there’s a Republican president! They don’t last forever, You know what lasts forever? Wiping out species!”

Maher is literally wishing for economic pain for more than 300 million Americans just so that another four years of Trump can be avoided.

That is how obsessed some of these radicals are with getting rid of Trump.

And without a doubt, the performance of the economy could be Trump’s Achilles heel. Whenever any piece of good economic news comes out, he eagerly takes credit for it, and he has publicly warned that there will be an economic crash if a Democrat wins in 2020…

President Donald Trump predicted doom if he isn’t re-elected in 2020, saying that the economy would “CRASH” like it did during the Great Depression.

In a tweet Wednesday morning, the president called the crowded field of Democratic challengers “clowns” and compared the prospects of one of them winning to the stock market collapse of 1929.

Even though many Democrats on Wall Street absolutely hate Trump, it is undeniable that they have made out very well while he has been in the White House. In fact, only three presidents have seen the stock market perform better during their first three years in office

Stock market performance in first three years since Trump’s election, then, ranks fourth among the 14 elected presidents since Herbert Hoover. That’s pretty good! It’s worth noting, though, that there’s not a whole lot separating him from John F. Kennedy, Bill Clinton and George H.W. Bush. A bad week or two, and he could easily fall to eighth place. On the other hand, falling to ninth would take some work, as would catching up to Dwight Eisenhower for third. Put into letter grades, I’d give the market’s performance since Trump’s election a solid B.

But what happens if the stock market crashes and the U.S. economy plunges into a deep recession in 2020?

Well, just as Trump has been getting credit for the good things that have happened in recent years, he would also get the blame if things got really bad.

Of course that wouldn’t actually be fair, because the truth is that the Federal Reserve actually has far more influence over the performance of the economy and the performance of the stock market than the president does.

But the general public does not understand these things.

When things really start to fall apart, people are going to blame whoever is in the White House, and since Trump was so eager to take credit when things were going good he won’t have any way to avoid the blame when things severely deteriorate.

So would the global elite really resort to “the nuclear option” of crashing the economy in order to prevent Trump from winning the next election?

You never know, but it is entirely possible. Today, debt is the lifeblood of our economy, and if the big banks started to tighten up the flow of credit that would begin to slow down our economy immediately. And as I noted yesterday, we are already starting to see banks deny loans to farmers in the middle of the country on a widespread basis. The tighter that lenders become with their money, the worse that our economy will do, and this is something that we should be watching closely.

The stock market is also a potential flashpoint. Right now, insiders are selling off their stocks “at the fastest pace in two decades”, and valuations are ridiculously inflated. Companies that are losing giant mountains of money every single year are supposedly worth billions of dollars, and the market has been going up for so long that most investors have completely forgotten about 2008. But at some point this entire charade is going to come crashing down, and it wouldn’t take very much of a “push” to make that happen.

There is an even bigger bubble in the bond market. Today, there is 188 trillion dollars of debt in the global financial system, and those at the very top of the economic food chain control much of that debt. Could it be possible that they would be willing to unleash a bit of chaos in order to achieve their political goals?

I don’t think that the global elite really want to go through a major crisis, but at this point for many of them just about anything is preferable to four more years of Trump.

We are less than two months away from 2020, and I truly believe that it will be the most chaotic year that any of us have seen in a very long time.

There are a lot of very powerful people that are absolutely determined to keep Trump from winning this upcoming election, and they would be willing to do just about anything in order to make that happen.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. This article may contain opinions on political matters, but it is not intended to promote the candidacy of any particular political candidate. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.

Global Debt Is Up To $188,000,000,000,000 – This Is Officially The Biggest Debt Bubble The World Has Ever Seen

The world is now 188 trillion dollars in debt, and that number continues to grow rapidly each year. It is a form of enslavement that is deeply insidious, because most of those living on the planet do not even understand how the system works, and even if they did most of them would have absolutely no hope of ever getting free from it. The borrower is the servant of the lender, and the global financial system is designed to funnel as much wealth to the top 0.1% as possible. Of course throughout human history there has always been slavery, and the primary motivation for having slaves is to extract an economic benefit from those that are enslaved. And even though most of us don’t like to think of ourselves as “slaves” today, the truth is that the global elite are extracting more wealth from all of us than ever before. So much of our labor is going to make them wealthy, and yet most people don’t even realize what is happening.

Let’s start with a very simple example to help illustrate this.

When you go into credit card debt and you only make small payments each month, you can easily end up paying back more than double the amount of money that you originally borrowed.

So where does all that money go?

Well, of course it goes to the financial institution that you got your credit card from, and in turn that financial institution is owned by the global elite.

In essence, you willingly became a debt slave when you chose to go into credit card debt, and the hard work that it took to earn enough money to pay back that debt with interest ended up enriching others.

On a much larger scale, the same thing is happening to entire nations.

Today, the United States government is nearly 23 trillion dollars in debt. In essence, we have been collectively enslaved, and we have been obligated to pay back all of that money with interest. Of course at this point it is literally impossible for us to ever pay back all that debt, and every year we add another trillion dollars or so to the balance. The global elite are now extracting more than 500 billion dollars in interest from this debt on an annual basis, and it is expected that number will greatly escalate in the years ahead.

It is not an accident that the Federal Reserve and the federal income tax were both instituted in 1913. The Federal Reserve system was designed to create an endless debt spiral that would get the federal government in as much debt as possible, and since that time the size of our national debt has gotten more than 7000 times larger. And the federal income tax was needed as the mechanism through which our wealth is transferred to the government to service all of this debt.

It is truly a deeply, deeply insidious system, and the American people should refuse to back any politician that does not favor shutting it down, but at this point this isn’t even a major political issue in our nation.

And of course the United States is far from alone. Even though we can’t get the whole world to agree on much of anything, somehow virtually the entire planet has been convinced that debt-based central banking is the way to go.

In fact, at this point 99.9 percent of the population of the world lives in a country that has a central bank.

According to Wikipedia, there are only 9 very small nations that do not have a central bank at this point…

-Andorra
-Isle of Man
-Monaco
-Nauru
-Kiribati
-Tuvalu
-Palau
-Marshall Islands
-Federated States of Micronesia

If you combine the populations of all of those 9 nations together, it comes to much less than 0.1% of the total global population.

Do you think that this is just a coincidence?

The global elite do not want humanity to be free. They want us to be in as much debt as possible so that we can make them richer.

When you realize how badly the game has been rigged, then a lot of things start to make a whole lot more sense.

For example, for those that understand how the system works it is certainly not surprising that the total amount of debt in the world has hit a new all-time record high of 188 trillion dollars

The global debt load has surged to a new all-time record equivalent to more than double the world’s economic output, IMF chief Kristalina Georgieva warned Thursday.

While private sector borrowing accounts for the vast majority of the total, the rise puts governments and individuals at risk if the economy slows, she said.

“Global debt — both public and private — has reached an all-time high of $188 trillion. This amounts to about 230 percent of world output,” Georgieva said in a speech to open a two-day conference on debt.

That number has risen by 24 trillion dollars since 2016, and it is the biggest debt bubble that the world has ever seen by a very wide margin.

Of course at some point this debt bubble is going to burst in a global disaster of epic proportions, but meanwhile the global elite are going to continue to milk all of us for as long as they possibly can.

Here in the United States, we have been on the greatest debt binge in the history of our nation since the last financial crisis. U.S. government debt has more than doubled, state and local government debt has ballooned to ridiculous proportions in much of the nation, corporate debt has doubled, student loan debt has more than doubled, auto loan debt just keeps hitting new record highs, and U.S. consumers are now 14 trillion dollars in debt.

Our mountain of debt has become so colossal that the only way to keep the game going is to borrow even more money, but by borrowing more money we make our enslavement even worse.

Meanwhile, those that are holding our debt just continue to live the high life as they laugh all the way to the bank.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse Blog, End Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The End, Get Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. This article may contain opinions on political matters, but it is not intended to promote the candidacy of any particular political candidate. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.

America Has Millions Of Millennial Brats That Need To Move Away From Mommy And Daddy And Start Acting Like Adults

If young adults are America’s future, then they better get their act together.  Today, over 30 percent of 18 to 34-year-olds live with their parents or other family members.  Meanwhile, marriage rates and fertility rates in the United States have both hit record lows in recent years.  Instead of coddling these self-absorbed Millennial narcissists well into their adult years, we need to be kicking them out of the nest and encouraging them to learn to fend for themselves.  In many instances, if they do not learn how to act like adults by the time they are 35, they never will.  It is time for parents all over America to exercise some tough love, because we are facing a major national crisis.

If you go all the way back to the mid-1970s, well over half of all 18 to 34-year-olds were already married and lived with their new spouse in their new households.

But today the most common living arrangement for those in that age group is living with Mommy and Daddy

In 1975, when the oldest Boomers were 29, 57% of 18 to 34- year-olds lived with a spouse in their own household. Even as late as 1990, almost half lived with a partner. But in 2016, 31% were living in their parents’ home, making it the new, most common living arrangement for young adults, according to Census data.

Yes, I know that life is rough and housing is expensive and good jobs are hard to find.

But that is what being an adult is all about – overcoming the tough times and learning to stand on your own.

And because our young people are not getting out on their own, a lot fewer of them are getting married and having children.  Here are some more numbers from Axios

  • In 2017, 57% of millennials were never married. In 1985 — when boomers were around the same age — only a third had never been married, Pew Research’s Richard Fry told Axios. Even accounting for unmarried living partners does not make up the difference, he said.
  • Having fewer children: When Boomers were in their 20s, the fertility rate was 2.48, well beyond the replacement level of 2.1. Today, it is just 1.76.
  • When a recent survey asked why they were having fewer kids, most young adults said “child care is too expensive.”

Sadly, a lot of parents actively encourage their children to put off marriage and children.  I have actually listened to many of these conversations personally.  The young people are told that they cannot be “tied down” while they are getting an “education”, and that “pursuing a career” must come first.

So has this approach made us happier as a nation?

Well, this may or may not be related, but according to the CDC the suicide rate in the United States has gone up almost 30 percent since 1999

“Suicide rates in the United States have risen nearly 30 percent since 1999, and mental health conditions are one of several factors contributing to suicide,” the CDC researchers wrote in their report.

“From 1999 to 2015, suicide rates increased among both sexes, all racial/ethnic groups, and all urbanization levels.”

We are not a happy country, and it is time for a change.

Unfortunately, it is not going to be easy to turn things around because the process begins very early.  Our young people are not prepared for life as adults because the education system in this nation is a complete joke.

Let me say it again so that you understand me perfectly.

The education system in this nation is a complete joke.

I know, because I spent 20 years in the system.  I graduated from public high school and then I went on to spend an additional 8 years at public universities.

We are witnessing the systematic “dumbing down” of America, and our schools are producing an endless stream of brain-dead zombies.  One study that was conducted not too long ago found that one-third of all high schools in the city of Baltimore did not have a single student that was proficient in math

An alarming discovery coming out of City Schools. Project Baltimore analyzed 2017 state testing data and found one-third of High Schools in Baltimore, last year, had zero students proficient in math.

You would figure that every school would have at least a few nerdy kids that were good with numbers, but apparently that is not the case in Baltimore.

And of course Baltimore is far from alone.  Just consider the following numbers

After leading the world for decades in 25-34-year-olds with university degrees, the U.S. is now in 12th place. The World Economic Forum ranked the U.S. at 52nd among 139 nations in the quality of its university math and science instruction in 2010.

According to the 2009 National Assessment of Educational Progress, 68% of public school children in the U.S. do not read proficiently by the time they finish third grade. And the U.S. News & World reported that barely 50% of students are ready for college-level reading when they graduate…

And in case you are tempted to think that last number is exaggerated, PBS has reported that in one recent year more than 200 colleges had to place “more than half of incoming students in at least one remedial course”…

Data from 911 two- and four-year colleges revealed that 96 percent of schools enrolled students who required remediation in the 2014-15 academic year, the most comprehensive recent numbers. At least 209 schools placed more than half of incoming students in at least one remedial course.

It isn’t as though most college courses are very challenging either.  The truth is that the family dog could have passed most of the courses that I ever had to sit through.

And instead of teaching our kids useful skills that can be used in the marketplace, many of these courses are all about indoctrinating them to see the world in a particular way…

Colleges nationwide are teaching students about tacos, hooking up and country music’s “homophobic and racist” message — but those are just a few examples, as classes such as “Queer Religion” and “Racial Capitalism” become the new norm.

If we want America to have any sort of a positive future, we need to completely change our approach to education, and then we need to kick our kids out of the nest when they reach a certain age so that they can learn to be adults.

Because right now what we are doing is not working, and as a result we have a giant mess on our hands.

Michael Snyder is a nationally syndicated writer, media personality and political activist. He is publisher of The Most Important News and the author of four books including The Beginning Of The End and Living A Life That Really Matters.

The Budget-Busting $1.3 Trillion Spending Bill That Was Just Passed By Congress Is A Betrayal Of The American People

I don’t know if I even have the words to express how disgusted I am with the omnibus spending bill that was just rushed through Congress. Members of the House of Representatives were given less than 24 hours to read this 2,232 page monstrosity of a bill before they were expected to vote on it, and so obviously nobody was able to read the entire thing before the vote was held. This is the kind of thing that Democrats were greatly criticized for in the past, but now it is Republicans that are doing it. The Republican Party is supposed to stand for limited government, and this is yet another example that shows how badly broken the system in Washington has become.

I am running for Congress in Idaho’s first congressional district, and I want to make it exceedingly clear that I would have voted against this bill. In addition to fully funding Planned Parenthood, this bill also funds a whole host of other liberal priorities. But other than an increase in military spending, conservative priorities are almost entirely ignored by this bill.

Over the past decade, we have been adding more than a trillion dollars a year to the national debt, and this omnibus spending bill dramatically increases government spending at a time when we should be desperately trying to get our financial house in order.

On Twitter, Rand Paul documented just a few of the examples of the tremendous waste in this bill…

o $12m for Scholarships for Lebanon
o $20m for Middle East Partnership Initiative Scholarship Program
o $12m in military funding for Vietnam
o $3.5m in nutrition assistance to Laos
o $15m in Developmental assistance to China
o $10m for Women LEOs in Afghanistan
o $1m for the World Meteorological Organization
o $218m for Promoting Democracy Development in Europe
o $10m for disadvantaged Egyptian Students
o $1.371bn for Contributions to International Organizations
o $51m to promote International Family Planning and Reproductive Health
o $7m promoting International Conservation
o $10m for UN Environmental Programs
o $5m for Vietnam Education Foundation Grants
o $2.579m for Commission on Security and Co-operation in Europe
o $15m to USAID for promoting international higher education between universities
o $1m for the Cultural Antiquities Task Force
o $6.25m for the Ambassadors Fund for Cultural Preservation
o $20m for Countering Foreign State Propaganda
o $12m for Countering State Disinformation and Pressure

After it passed, Democratic leaders were jubilant. The following comes from the American Mirror

House Minority Leader Nancy Pelosi and her esteemed counterpart in the Senate, Sen. Chuck Schumer, are declaring the spending bill rushed through by Republicans this week as “a victory.”

“The distinguished leader has clearly put forth many of the priorities that we’re very proud of in a bill that’s one yard high,” Pelosi said of House Speaker Paul Ryan at a joint press conference with Schumer on Thursday.

Senator Schumer also admitted that the Democrats got more accomplished in this bill than they did during any of the spending bills when Barack Obama was in the White House, and Nancy Pelosi added that Republican leadership rushed this legislation through so quickly because “they didn’t want their colleagues to see what was in the bill.”

What we have in Washington D.C. today doesn’t look anything like what our founders originally intended. It is time to take our government back, and we need fresh leadership in Washington.

I am not going to Washington to be a cog in the system. Rather, I am going to Washington to drain the swamp and to turn the current corrupt system completely upside down. If you would like to learn more about what we are trying to do, please visit MichaelSnyderForCongress.com.

Michael Snyder is a pro-Trump candidate for Congress in Idaho’s First Congressional District. If you would like to help him win on May 15th, you can donate online, by Paypal or by sending a check made out to “Michael Snyder for Congress” to P.O. Box 1136 – Bonners Ferry, ID 83805. To learn more, please visit MichaelSnyderForCongress.com.

Goodbye American Dream: The Average U.S. Household Is $137,063 In Debt, And 38.4% Of Millennials Live With Their Parents

Once upon a time the United States had the largest and most vibrant middle class in the history of the world, but now the middle class is steadily being eroded. The middle class became a minority of the population for the first time ever in 2015, and just recently I wrote about a new survey that showed that 78 percent of all full-time workers in the United States live paycheck to paycheck at least part of the time. But most people still want to live the American Dream, and so they are going into tremendous amounts of debt in a desperate attempt to live that kind of a lifestyle.

According to the Federal Reserve, the average U.S. household is now $137,063 in debt, and that figure is more than double the median household income…

The average American household carries $137,063 in debt, according to the Federal Reserve’s latest numbers.

Yet the U.S. Census Bureau reports that the median household income was just $59,039 last year, suggesting that many Americans are living beyond their means.

As a nation, we are completely and utterly drowning in debt. U.S. consumers are now nearly 13 trillion dollars in debt overall, and many will literally spend the rest of their lives making debt payments.

Over the past couple of decades, the cost of living has grown much faster than paychecks have, and this has put a tremendous amount of financial stress on hard working families. We are told that we are in a “low inflation environment”, but that is simply not true at all

Medical expenses have grown 57% since 2003, while food and housing costs climbed 36% and 32%, respectively. Those surging basic expenses could widen the inequality gap in America, as a quarter of Americans make less than $10 per hour.

Getting our healthcare costs under control is one of the biggest things that we need to do. As I talked about the other day, some families have seen their health insurance premiums more than triple since Obamacare became law.

As the cost of living continues to rise, an increasing number of young people are discovering that the only way that they can make ends meet is to live with their parents. As a result, the percentage of adults age 26 to age 34 that live at home continued to rise even after the last recession ended…

The share of older Millennials living with relatives is still rising, underscoring the lingering obstacles faced by Americans who entered the workforce during and after the Great Recession.

About 20% of adults age 26 to 34 are living with parents or other family members, a figure that has climbed steadily the past decade and is up from 17% in 2012, according to an analysis of Census Bureau data by Trulia, a real estate research firm.

A staggering 59.8 percent of younger Millennials (18 to 25) are now living with relatives, and overall an all-time record 38.4 percent of all Millennials are currently living with family.

If so many of our young people are unable to live the American Dream, what is the future of this nation going to look like?

Consumers are not the only ones that have been struggling to make ends meet. Corporate debt has doubled since the last financial crisis, and it now stands at a record high of 8.7 trillion dollars

Fueled by low interest rates and strong investor appetite, debt of nonfinancial companies has increased at a rapid clip, to $8.7 trillion, and is equal to more than 45 percent of GDP, according to David Ader, chief macro strategist at Informa Financial Intelligence.

According to the Federal Reserve, nonfinancial corporate debt outstanding has grown by $1 trillion in two years.

“Everything is fine until it isn’t,” Ader said. “We don’t need to worry about that until we’re in a slowdown and profit declines.”

And let us not forget government debt. State and local governments all over the nation have piled up record amounts of debt, and the debt of the federal government has approximately doubled over the past decade.

But the fact that we are now 20 trillion dollars in debt as a nation does not tell the full story. According to Boston University professor Larry Kotlikoff, the federal government is facing a fiscal gap of 210 trillion dollars over the next 75 years…

We have all these unofficial debts that are massive compared to the official debt. We’re focused just on the official debt, so we’re trying to balance the wrong books…

If you add up all the promises that have been made for spending obligations, including defense expenditures, and you subtract all the taxes that we expect to collect, the difference is $210 trillion. That’s the fiscal gap. That’s our true indebtedness.

We were the wealthiest and most prosperous nation in the history of the planet, but that was never good for us.

We always had to have more, and so we have been on the greatest debt binge in human history.

Now a day of reckoning is fast approaching, and those that believe that we can escape the consequences of our actions are being extremely delusional.

Michael Snyder is a Republican candidate for Congress in Idaho’s First Congressional District, and you can learn how you can get involved in the campaign on his official website. His new book entitled “Living A Life That Really Matters” is available in paperback and for the Kindle on Amazon.com.

78 Percent Of U.S. Workers Are Living ‘Paycheck To Paycheck’ And 71 Percent Of Them Are In Debt

Are you living paycheck to paycheck? Is so, you are just like most other hard working Americans. As you will see below, 78 percent of full-time workers in the United States say that they are living paycheck to paycheck. That is the highest figure ever recorded, and it is yet more evidence that the middle class is under an increasing amount of stress. The cost of living is rising at a much faster pace than our paychecks are, and more families are falling out of the middle class with each passing month. Unfortunately, this is something that the mainstream media really doesn’t want to talk about these days. Instead, they just keep having us focus on the soaring financial markets which are being grossly artificially inflated by global central banks.

When I came across the numbers that I am about to share with you I was actually quite stunned. I knew that things were not great in “the real economy”, but I didn’t expect that the number of Americans living paycheck to paycheck would actually be rising. But that is precisely what a brand new survey that was just released by CareerBuilder is saying…

Seventy-eight percent of full-time workers said they live paycheck to paycheck, up from 75 percent last year, according to a recent report from CareerBuilder.

Overall, 71 percent of all U.S. workers said they’re now in debt, up from 68 percent a year ago, CareerBuilder said.

While 46 percent said their debt is manageable, 56 percent said they were in over their heads. About 56 percent also save $100 or less each month, according to CareerBuilder.

The first thing that we want to note about this survey is that it only includes full-time workers. So the unemployed, part-time workers, those that work for themselves and those that are independently wealthy were not included.

The second thing that we want to note is that these numbers have gotten worse since last year.

That certainly does not fit with the narrative that we are being fed by the mainstream media, but it does fit with the reality that most people are living on a daily basis.

Most Americans work extremely hard, but they can never seem to get ahead. Most of us are in debt, and a couple of weeks ago I wrote about how the elite use debt as a tool of enslavement. As we work endless hours to “pay the bills”, we are steadily enriching those that are holding our debts.

In addition, the cost of living is steadily going up, and most U.S. families are just barely scraping by from month to month as a result. Just a couple days ago I wrote about how Obamacare was causing health insurance premiums to skyrocket, and today I came across another example of someone that has seen their annual premiums more than double during the Obamacare era…

For some lower-income people in Obamacare, the rising premiums President Donald Trump has talked so much about will barely be felt at all. Others, particularly those with higher incomes, will feel the sharp increases when insurance sign-ups begin Wednesday.

Richard Taylor is one of the people on the wrong end. The 61-year-old, self-employed Oklahoman has meticulously tracked his medical costs since 1994. In 2013, he signed up for an Affordable Care Act plan for the law’s first year offering coverage to millions of Americans.

Four years ago, annual premiums for a mid-level “silver” plan to cover his family totaled $10,072.44. For 2017, they were $21,392.40—up 112 percent.

Who can afford $21,000 a year for health insurance?

I know that I can’t.

And rates are supposed to go up substantially again in 2018. We must repeal Obamacare, and we must do it now.

In addition to financial stress, most Americans are also deeply concerned about the future of this country. Just consider the following numbers from a poll that was released this week

Almost two-thirds of Americans, or 63 percent, report being stressed about the future of the nation, according to the American Psychological Association’s Eleventh Stress in America survey, conducted in August and released on Wednesday. This worry about the fate of the union tops longstanding stressors such as money (62 percent) and work (61 percent) and also cuts across political proclivities. However, a significantly larger proportion of Democrats (73 percent) reported feeling stress than independents (59 percent) and Republicans (56 percent).

I certainly can’t blame the Democrats for being stressed out. Donald Trump is in the White House and pro-Trump forces are taking over the Republican Party. And if a large wave of pro-Trump activists goes to Congress in 2018, we are going to take this nation in a completely different direction.

That same survey referenced above also discovered that 59 percent of Americans consider this “to be the lowest point in our nation’s history that they can remember”

A majority of the more than 3,400 Americans polled, 59 percent, said “they consider this to be the lowest point in our nation’s history that they can remember.” That sentiment spanned generations, including those that lived through World War II, the Vietnam War, and the terrorist attacks of Sept. 11. (Some 30 percent of people polled cited terrorism as a source of concern, a number that’s likely to rise given the alleged terrorist attack in New York City on Tuesday.)

That number seems very strange.

Yes, I can understand that those on the left are very pessimistic now that Trump is in the White House, but this is definitely not the lowest point in recent history.

Have people totally forgotten the financial crisis of 2008?

What about 9/11?

The JFK assassination, the Vietnam War, the deep recession during the Carter years and the entire Obama era are also examples of very low points in recent history.

Yes, great challenges are coming, but for the moment the economy is relatively stable, much of the world is at peace, and at least Hillary Clinton is not in the White House.

There is so much to be thankful for, and if people out there think that this is the “lowest point” in recent American history, how are they going to feel when a real crisis comes along?

Michael Snyder is a Republican candidate for Congress in Idaho’s First Congressional District, and you can learn how you can get involved in the campaign on his official website. His new book entitled “Living A Life That Really Matters” is available in paperback and for the Kindle on Amazon.com.

Will America’s Prosperity Be Completely Wiped Out By Our Growing Debt?

The federal government is now 20.4 trillion dollars in debt, and most Americans don’t seem to care that the economic prosperity that we are enjoying today could be completely destroyed by our exploding national debt. Over the past decade, the national debt has been growing at a rate of more than 100 million dollars an hour, and this is a debt that all of us owe. When you break it down, each American citizen’s share of the debt is more than $60,000, and so if you have a family of five your share is more than $300,000. And when you throw in more than 6 trillion dollars of corporate debt and nearly 13 trillion dollars of consumer debt, it is not inaccurate to say that we are facing a crisis of unprecedented magnitude.

Debt cannot grow much faster than GDP indefinitely. At some point the bubble bursts, and when it does the pain that the middle class is going to experience is going to be off the charts. Back in 2015, the middle class in the U.S. became a minority of the population for the first time ever. Never before in our history has the middle class accounted for less than 50 percent of the population, and all over the country formerly middle class families are under a great deal of stress as they attempt to make ends meet. The following comes from an absolutely outstanding piece that was just put out by Charles Hugh Smith

If you talk to young people struggling to make ends meet and raise children, or read articles about retirees who can’t afford to retire, you can’t help but detect the fading scent of prosperity.

It has steadily been lost to stagnation, under-reported inflation and soaring inequality, a substitution of illusion for reality bolstered by the systemic corruption of authentic measures of prosperity and well-being.

In other words, the American-Dream idea that life should get easier and more prosperous as the natural course of progress is still embedded in our collective memory, even though the collective reality has changed.

The reality that most of us are facing today is a reality where many are working two or three jobs just to make it from month to month.

The reality that most of us are facing today is a reality where debts never seem to get repaid and credit card balances just continue to grow.

The reality that most of us are facing today is a reality where we work day after day just to pay the bills, and yet we never seem to get anywhere financially.

The truth is that most people out there are deeply struggling. The Washington Post says that the “middle class” encompasses anyone that makes between $35,000 and $122,500 a year, but very few of us are near the top end of that scale

It’s also situation specific. “The more people in a family, the more money they typically need to live a comfortable middle-class lifestyle,” writes the Post. Likewise, the more expensive your area, the more you need to make to qualify. Overall, “America’s middle-class ranges from $35,000 to $122,500 in annual income, according to The Post’s calculation” approved by the Pew Research Center.

“The bottom line is: $100,000 is on the middle-class spectrum, but barely: 75 percent of U.S. households make less than that,” writes the Post.

In a previous article, I noted that the bottom 90 percent of income earners in the U.S. brought home more than 60 percent of the nation’s income back in the early 1970s, but last year that number fell to just 49.7 percent.

The middle class is shrinking year after year, and the really bad news is that it appears that this decline may soon accelerate. In fact, one major European investment bank is warning that the U.S. economy will “slow down substantially” in 2018.

But we can’t afford any slow down at all. As it is, there is no possible way that we are going to be able to deal with our exploding debts at the rate the economy is growing right now. According to Boston University professor Larry Kotlikoff, we are facing a “fiscal gap” of 210 trillion dollars over the next 75 years…

We have all these unofficial debts that are massive compared to the official debt. We’re focused just on the official debt, so we’re trying to balance the wrong books…

If you add up all the promises that have been made for spending obligations, including defense expenditures, and you subtract all the taxes that we expect to collect, the difference is $210 trillion. That’s the fiscal gap. That’s our true indebtedness.

Where in the world is all of that money going to come from?

Are you willing to pay much higher taxes?

Are you willing to see government programs slashed to a degree that we have never seen before in U.S. history?

If your answer to both of those questions is no, then what would you do to solve the fiscal nightmare that we are facing?

According to Brian Maher, author Robert Benchley once sat down to write an article about this fiscal mess, and what he came up with sums up the situation perfectly…

Benchley sat at his typewriter one day to tackle a vexing subject.

He opened his piece with “The”… when the full weight of his burden collapsed upon his shoulders.

He abandoned his typewriter in frustration.

He returned shortly thereafter and resumed the task anew…

With only “The” to work with… Benchley immediately knocked out the article, presented here in its entirety:

“The hell with it.”

Unfortunately, we can’t afford to say that.

Our exploding debt is a crisis that we must tackle, and the first step is to understand that our current financial system was literally designed to create as much debt as possible. Once we abolish the Federal Reserve, our endless debt spiral will end, but until we do our debt problems are only going to continue to grow until the system completely implodes in upon itself.

Michael Snyder is a Republican candidate for Congress in Idaho’s First Congressional District, and you can learn how you can get involved in the campaign on his official website. His new book entitled “Living A Life That Really Matters” is available in paperback and for the Kindle on Amazon.com.

Washington D.C. Is Essentially Just A Gigantic Money Machine

If you have ever wondered why our leaders in Washington D.C. seem to act so strangely, the truth is that it almost always comes down to just one thing. It has been said that “money makes the world go round”, and that is definitely true in Washington. This year the federal government will spend more than 4 trillion dollars, and that represents well over one-fifth of our national GDP. With so much money coming in and so much money going out, the stakes are incredibly high, and that is why so much money is poured into political campaigns on the national level.

And it shouldn’t surprise anyone that those that live the closest to this gigantic money machine have benefited greatly. Forbes just released their brand new rankings for 2017, and they found that five out of the top 10 wealthiest counties in the entire country are suburbs of Washington D.C.

Virginia’s Loudoun County holds the title of the nation’s richest county with a median household income of $125,900. While nearly 10,000 residents commute to the District, according to Forbes, about 11,700 businesses employ 161,000 county residents, with Dulles International Airport, Loudoun County Public Schools and the Department of Homeland Security leading that charge.

The nearby city of Falls Church, Fairfax and Arlington counties in Virginia and Howard County in Maryland also lead the nation based on wealth.

In general, salaries for federal workers are significantly higher than in the private sector, and benefit packages are usually much better.

But in addition to having a very high concentration of federal workers, the D.C. area is also home to hordes of lawyers, lobbyists, defense contractors and other government vendors. Big government means big business for those guys, and business has been very good in recent years…

The federal government has a lot to do with this: The Capitol and the economy orbiting around it (including lawyers, defense contractors, computer engineers along the Dulles Corridor, and doctors near NIH) attract college graduates who reliably contribute to six-figure households. Crucially, there was a $1.7 billion increase in lobbying between 1998 and 2010, as Dylan Matthews explained. With each $1 million of lobbying “associated with a $3.70 increase in the D.C. wage premium,” the money pouring into Washington wound up in the pockets of its residents.

This certainly isn’t the limited government that our founders intended.

So where did we go wrong?

One of the big turning points came in 1913. That is the year when the Federal Reserve and the modern version of the income tax were established. The Federal Reserve was designed by the elite to get the federal government very deeply into debt, and an income tax was needed to help service that debt and to help pay for the much larger government that the progressives were wanting.

Back then, D.C. was nothing like it is today. In fact, even in the 1970s there were still large farms inside the Beltway. But the federal government just kept getting bigger and bigger and bigger, and now it is a four trillion dollar monstrosity.

What I believe we should do is to dismantle as much of that monstrosity as we possibly can. Instead of asking which government agencies we should close, I believe that we should be asking which government agencies we really need to leave open.

A great place to start would be by abolishing the Federal Reserve, the IRS and the income tax. Those institutions are at the very core of the Washington money machine, and so it would essentially be like tearing the heart out of big government.

And don’t worry, the federal government would still have plenty of money coming in. The individual income tax only accounts for about 46 percent of all federal revenue, and theoretically we could still have an absolutely enormous federal government without an income tax. I once wrote an article that listed 97 different ways that various levels of government get money out of us each year, and so getting rid of the federal income tax would still leave 96 ways for the politicians to extract money from us.

As I remind my readers so frequently, the greatest period of economic growth in U.S. history was when there was no income tax and no central bank. But I know that a lot of people out there love the 1.33 percent average yearly GDP growth rate that we have been experiencing over the past decade and would have a really hard time giving that up.

Unfortunately, it would actually be a very tough transition to a much more limited federal government because so much of our society is geared around the enormous money machine in Washington. In 2018, more than a billion dollars will be spent on the mid-term elections, and most of that money will be going to incumbents that are committed to maintaining the status quo.

If we ever want things to really start changing in Washington, we have got to start sending people there that haven’t been bought off by the big money interests.

In my congressional district there is no incumbent running in 2018, and nobody else in the race is nearly as conservative as I am. But since I can’t be bought by the special interests, I am going to have to rely on grassroots support.

Donald Trump showed us that anything is possible in American politics. When Jeb Bush decided to run for president, he had an extremely long list of endorsements and a hundred million dollars behind him, and he still got trounced by Trump because Trump had a much stronger message.

If we stand united, we can take our government back and there won’t be anything that the establishment will be able to do about it.

But if we sit back and do nothing, the cesspool of corruption in Washington D.C. will just continue to get deeper and deeper.

Michael Snyder is a Republican candidate for Congress in Idaho’s First Congressional District, and you can learn how you can get involved in the campaign on his official website. His new book entitled “Living A Life That Really Matters” is available in paperback and for the Kindle on Amazon.com.

The 25 Year-Old Economic Depression Model and Predictions

The Great Depression

The world economy is in the middle of a depression period that will last the rest of this decade and run perhaps well into the 2020s. This depression period and the others that the world has experienced since the late 1700s were due to an 80 year cycle of paradigm change in physics and technology development. Twenty-five years ago, this author developed an economic model concerning this relationship between physics paradigm changes and depressions and described the model and the evidence for it in a book titled: The Periodic Production of Rationalized Phenomena and the Past Periodic Depressions. In the early 1990s, I then predicted, based on the model, that there would be a 10 year economic boom starting about the year 2000 in the countries that led in the development of Quantum Mechanics-based technology followed by a financial crisis around 2009 and a long depression period perhaps lasting 12 years. The prediction proved correct. Unprecedented peacetime lending and currency creation has kept the usual depression symptoms at bay, but conditions will get worse during this decade. Here’s the model, some information about the current economic situation, and predictions.

The Economic Depression Model

In the early and middle 20th century, economists such as Kondratiev and Schumpeter identified a cycle in advanced economies that was known as the long wave or Kondratiev wave. They thought that the cycle lasted about half a century. This assumption was mainly based on the depressions of the 1800s that happened about 50 years apart. But actually, these major depressionary eras tend to happen 40 years apart as I discovered in the late 1980s. The economic long wave in advanced societies is due to the technological change that is due to paradigm changes in physics that happened about every 80 years.

Scientific Revolutions

Illustration 1: The scientific revolutions in the field of physics are spaced about 80 years apart. In the 1580s and 1590s, three men individually and more or less independently formulated similar basic theories for the second scientific paradigm. Both Galileo and Kepler had knowledge of Gilbert’s work and book and they corresponded by letter about theory.

Thomas Kuhn wrote about how these instances of physics paradigm change happened in a classic book called The Structure of Scientific Revolutions, but he never described that they happen 80 years apart or that paradigm changes in the field of physics had any regular timing to them. But the regular timing is clear: historically they have happened from 73 to 87 years apart. What does it mean that a physics paradigm change happens? It means that large groups of people think about the world differently than earlier generations, and they develop new kinds of technology and products. These products, new technologies, and new industries start to appear about 20 years after the theory of the paradigm is well developed around the time of the “crisis period” at the end of each physics paradigm. Kuhn coined the term “crisis period,” and these crisis periods last about 20 years and happened at the times marked in red above in Illustration 1.
I wrote a whole book and many papers about this in the 1990s, and some of these can be found on my site, sciencejunk.org, or published in various places. The economics model is simple and based on the work of Kondratiev, Kuznets, and J. Waters mainly. So if this model interests you, you can read about it online. The book goes into a lot of detail explaining and detailing the history of science from before Copernicus to present times.

Industrial Revolution Depressions

There have been two kinds of depressions since 1780 in the most advanced economies. They are quite different, and they alternate. The two kinds of depressions are the industrial revolution depressions and the technological acceleration depressions. The industrial revolution depressions happen during the industrial revolutions. They more or less coincide with a crisis period in physics and are characteristized by low productivity growth and the emergence of many companies in major new fields of industry.
First Industrial Revolution: Franklin’s Fluid paradigm was developed by Aepinus, Lavoisier, Coulomb and many others in the period from about 1750 to 1785, and it led to the development of industries relatively quickly because his paradigm was accepted and adopted in advanced countries quite rapidly. Young people such as Watt started to make devices based on the conception of fluids of heat, electricity, and magnetism that each had their own unique properties. Watt developed a good steam engine design that was adopted to power many industries during the First Industrial Revolution of the 1790s and early 1800s. So labor productivity growth in Britain started to rise as Britain emerged from the depression era of the 1780s and 1790s.
Second Industrial Revolution: Likewise, Faraday’s conception of point atoms and lines of force that extended from them was developed by Maxwell around 1865. Twenty years later, researchers such as Hertz, Tesla and Edison started to invent the technology of the 20th century. There was an industrial revolution in the 1890s and early 20th century. Due to the depletion of the technology potential of the Fluid paradigm and the small size of the nascent Field theory based industries, as well as other factors all stemming from this change of technology, there was a depression period in the US and Great Britain in the 1890s. As the new industries of the Field paradigm grew, productivity growth started to increase in the first decade of the 20th century from its low during that depression period.
Third Industrial Revolution: Similarly, Einstein’s model of quanta of energy and space-time change to describe gravity was well developed as two different theories called Quantum Mechanics and General Relativity. These two theories make up the Einstein paradigm, and they were both well developed by about 40 years after 1905 that was when he formulated this paradigm. Again, 20 years after the theory was well developed around 1965, young inventors started to innovate the main products of this technology paradigm such as lasers, computer chips, and PCs. Due to the depletion of the technological potential of the field theory paradigm and the development of the new technologies, there was a depressionary era in the 1970s and 1980s coinciding with the third industrial revolution of those decades. Labor and capital were culled from the matured and dying industries, and they transferred to the new QM based industries that began at that time.
The above is a short explanation for why the industrial revolution depressions were timed as they were in the 1780s-1790s, 1880s-1890s, and 1970s-the early 1980s. These three industrial revolution depressions were all quite similar. There were productivity growth dearths and the emergence of revolutionary new fields of industry and technology that supported the rapid growth of many small companies in each field. For more information, read my articles on sciencejunk.org. In my book that was written mostly in the early 1990s, I explain this model in greater detail.
In Illustration 2 below, the labor productivity growth in the US is in a characteristic periodic wave pattern with the slumps during the industrial revolutions. The chart was made about 2001 and shows an S-wave or Gompertz curve pattern.

technological revolutions
Illustration 2: This chart shows the labor productivity growth trend and the industrial revolutions in the US. The industrial revolutions caused the periodic productivity growth trend, and the industrial revolutions depressions happened in the 1780s and 1790s, 1880s and 1890s, and the 1970s and early 1980s. See how around 1830, 1920, and 1999 there was a sudden spurt of productivity growth? It was this technological change that Waters called “technological acceleration” that caused the more severe technological acceleration depressions in the following decades.

 

Illustration 3: This chart was made in 2001 or so and shows how I was guesstimating that the annual productivity growth from 1996-2004 would be about 2.6% on average even though the stats for several years were not in yet. You can clearly see the marked productivity growth acceleration around 1830, 1919, and 1999. The stats for labor productivity growth from 1799 to 1989 were from Paul Romer.

Technological Acceleration Depressions

For the last two centuries, after about 20 years after the end of an industrial revolution depression, there has been a sudden doubling of labor productivity growth. Joseph Waters pointed out this acceleration of producitivity growth rates in his book Technological Acceleration and the Great Depression. When I found this book in 1989, it helped me understand how productivity growth acceleration in the US caused the Great Depression. There was a similar doubling in the 1820s in Great Britian when it was the technology leader of the Fluid paradigm industries.
The doubling of growth happens because people in the industries of a paradigm switch their product innovation from product introduction to process innovation. During an industrial revolution, the generation of young inventors such as Edison focus on designing and introducing new kinds of products. These products are revolutionary, and spur great demand. But 20 years later, the industries standardize so that the people focus on producing the standardized products cheaply and are in competition for market share in markets that become oligopoly markets. These same characteristic features can be seen in the economies of Great Britain in the 1820s, the US in the 1920s, and the US in the decade of the 2000s when each of these economies hit their “boom” phase of development.
Automation, economies of scale, and capturing the market for a standardized product became the emphasis, and the competition between the many companies in each industry involved price competition and merger and acquisition activity. Through heavy borrowing and offering consumers credit, some companies expanded, automated production to reduce prices, and survived in oligopoly or monopolistic markets while the other companies were absorbed or went bankrupt. We saw this happen during the last decade when oligopolies emerged in the US. The remaining companies unemployed of a large part of the workforce through their acquisition and streamlining of production processes.
The switch from product to process innovation is what caused the technological acceleration depressionary periods of the 1830s-1840s, 1930s-early 1940s, and now. So there was a standarization of available products, a lack of new product innovation for revolutionary new products that would allow for new markets, and a great increase in unemployment or disemployment. Since the US was the technological follower of Great Britain, the country entered its depression era about 8 years after Britain did starting from 1837 with a large number of bank closures.
In 1989, I realized that the regular timing of depressions of the past of the Kondratiev long wave is due to the 80-year physics paradigm change process causing depressions about every 40 years, and that there was going to be a depressionary period of the technological acceleration type that would commence about the year 2009 although I wasn’t sure my model was accurate enough to pinpoint 2009 as the exact year. But the model did prove very accurate, and the depression era commenced in 2008.

Illustration 4: Chart of the economic depression periods and productivity growth rates in the US extrapolated out to the 2030s. The dates of the depression periods are shown in gray. The industrial revolution depressions happened in the 1790s, 1890s, and the 1970s. The technological acceleration depressions happened in the 1840s, 1930s, and 2010s in the US. The dates for the depression periods are similar for Great Britain, although that country was in an industrial revolution depression in the 1780s extending for two decades, a technological acceleration depression in the 1830s extending into the 1840s, an industrial revolution depression in the 1880s extending for two decades, and their third industrial revolution depressionary period lasted longer in the 1980s than did that of the US that ended around 1982. The green areas show the approximate time of the technological acceleration periods when productivity growth suddenly doubled in each of the three eras. In the early 1800s, the British technological acceleration period happened 10 years earlier than the American because Britain was the technological leader of the First Industrial Revolution era and about 8 or 10 years ahead of the US in industrial development and technology. The yellow areas show the times of technological/industrial revolutions. The blue areas show the productivity growth slumps and industrial revolution depression periods.

Past Written Predictions as Evidence for the Model’s Accuracy

I’ve been writing about this depressionary period of the 2010s for 25 years after I developed this model in 1989. The model explains why the economic long wave happens as a result of paradigm changes in physics. That the economic predictions have matched the economic eventsfor the last 25 years is evidence that this model is accurate.
In the early 1990s,I wrote:

“Scientific revolutions have happened at about 80 year intervals, and these have caused “technological revolutions” at about 80 year intervals and economic depressionary periods about every 40 years. The periodic depressions have been called Kondratiev depressions.” Introduction to The Periodic Production of Rationalized Phenomena and the Past Periodic Depressions, 1996. www.padrak.com/ine/ELEWIS6.html

In the middle of the 1990s, I wrote:

“If the trend of economic development continues as it has for the past 200 years, the peoples who lead in the production of Q.M.-type phenomena will undergo the first kind of depressionary period about the year 2010 or 2020 unless there will be some type of financial collapse. It is interesting to me that economists such as Dent are also predicting a depressionary period about the years 2010 or 2020 based on generational life-cycle theory.” Introduction to The Periodic Production of Rationalized Phenomena and the Past Periodic Depressions, 1996. www.padrak.com/ine/ELEWIS6.html

So 20 years ago, I tried to backet out in my online introduction to my book the time when the technological revolution depression would happen based on my model. I wasn’t totally sure about the 2010 date although I thought this depression would follow along on the 40 year timing, so I included 2020 as a possible late date just in case the 2010 date was too early. As you can see, I was basically predicting that the decade of the 2010s would be the depression period. What I meant about including the phrase “unless there will be some type of financial collapse” is that I was thinking the financial markets could collapse before 2009 since it seemed that a disaster or some other trigger might cause a financial crisis given the record high government debts. Though there were financial crises between 1996 and 2008, none was severe enough to start a depression. By this time, in 1996, I had read Dent’s book and his economic predictions based on demographics, and I was surprised that such a different model predicted the same time for this current depression period.
I tried to publish the book and my articles during the 1990s. But almost no one believed me. People who believed in economic long waves in the 1990s mostly predicted that a depression would occur in the 1990s based on their assumption that these depressions happen every 50 or 60 years and that the last such depression was the 1930s Great Depression. These people didn’t believe that the 1970s global great recession was actually a Kondratiev long wave slump, and they didn’t believe that there are two alternating types of depressions as I tried to explain to them.
In 1998, I was blogging on early long-wave discussion forums and telling people that an economic boom was about to start that would be similar to the 1920s boom period with its doubling of productivity growth rates. Though few people believed or agreed with what I was saying since most of the long wave bloggers were thinking that the US was in a long wave depression era then in the 1990s, I was predicting that a ten year economic boom was starting. As shown in a this note attached in May 28, 1998 to the the 1996 web article cited above, I wrote:

“According to the theory, barring unforeseen disasters, even more rapid industrial development and higher growth rates are predicted for the future. Specifically, during the next 10 years the most advanced economies will experience economic development in many ways similar to the period from 1917-1929 in the U.S., a time when the U.S. economy boomed and entire industries were developed. That was a time of great social change.” Note appended online in 1998 to my online article: Introduction to The Periodic Production of Rationalized Phenomena and the Past Periodic Depressions, 1996. www.padrak.com/ine/ELEWIS6.html

This prediction about the period 1999-2009 that was actually made earlier than 1998 proved exactly accurate to the year basically. No one I knew about except Harry Dent was writing the same prediction. It shows that I thought that the year 2009 might mark the start of the depression. I knew from the technological acceleration eras of the 1820s and 1920s that these technological acceleration periods had ten year booms followed by a financial crash and a long depression era lasting about 13 years or so.
By 2003, it was clear to me that the technological acceleration had started just as I predicted it would about the year 1999, and it was clear that the US was in a boom period with high borrowing just as I predicted. It was also clear to me that this scientific change-economic model proved accurate enough that I should warn people that a new major depression period was about to start about 2009.
I calculated the date 2009 from the pattern of the 1920s and 1820s. The productivity growth doubling happened in 1919, and the depression started with a financial crash 10 years later in 1929. So I thought that a financial crash and a depression would start about 2009 or 10 years after the productivity growth doubling of 1999.
I tried to warn people about this imminent depression and financial crash, and after several attempts of sending to journals and business magazines, I eventually published a letter in a small science magazine where I had previously published physics articles. I wanted to warn the people in my field and whoever else would read it.
In that letter that I wrote in late 2007, I said:

“If any of these predictions hadn’t turned out to be so accurate it would have disproved this theory. But since these predictions from 1990 have proved so accurate, it seemed proper to warn people of a possible depression or deep recession in the near future. Even if the idea of an 80 year periodicity of revolutions seems untrue to you, if these trends continue of rising productivity due to the displacement of labor by automation, oligopoly and efficiencies of scale, increasing business and consumer debt, and the satiation of consumer demand of the available types of products within the constraints of their budgets, what will the outcome be but a general decrease of consumption demand?” “Economic Depression or Deep Recession Coming Soon,” May, 2008. tc38.metawerx.com.au/oldsite/LewisLetter79.pdf

In the middle of the last decade, merger and acquisition activity had reached a new high in the US, and I saw other data that reminded me of the 1920s such as the record high consumer and corporate debt. It was clear that products were standardizing and that the major quantum mechanics based industries were becoming oligopoly markets and were rapidly automating. In late 2007, I thought that unemployment would soon quickly spike up due to the merger and acquisitions and the automation of production that was similar to what happened in 1929. I titled this letter: “Economic Depression or Deep Recession Coming Soon.”

In this letter to the editor that I wrote in late 2007, I also said:

“In 2007, the stock market reached record highs. Americans are also working record hours per week and the unemployment rate this decade has been lower than any decade since the 1960s. Many American states have record low unemployment. Since August 1982, when it bottomed at 776, the Dow has risen almost 1,700%. That ascent reflects an economy that has nearly tripled from $5.2 trillion in 1982, adjusted for inflation, to $13.9 trillion today. Extremely high debt levels were predicted for the lead economy. This is evident. As happened in the late 1920s, the U.S. has record business and private debt as businesses struggle to survive as oligopolies formed in each industry and the survivors tried to gain market share. In 2005 and 2006 a record was set for mergers and acquisitions in the U.S. economy. Mergers and acquisitions are at the highest level since the Great Depression.”

The letter continues:

“Total corporate debt that has financed the corporate drive for market share and for corporate survival is the highest since the Great Depression. Total American consumer debt reached $2.2 trillion in 2005, up from $1 trillion in 1994. And, 2005 was a record year for personal bankruptcies.” “Economic Depression or Deep Recession Coming Soon,” May, 2008. tc38.metawerx.com.au/oldsite/LewisLetter79.pdf

This letter was sent to a little magazine called Infinite Energy in December of 2007, and it was eventually published in May of 2008. It is a good record that I was warning people about the imminent K-wave depression period and that this depression would be like the 1920s depression. I explained the causes of the imminent depression and what the depression would be like. It explained that it was all due to the transitioning of the QM based industries from emphasizing product innovation to emphasizing process innovation. Process innovation causes unemployment because people pursue production at lower cost through automation and methods of mass production and unemploy human labor. I couldn’t get my articles or letters published in other journals or magazines though I tried to submit my articles and letters to a handful of publications over a period of about half a year.
At the time I wrote this letter in late 2007, I looked online for people who were predicting that a financial crisis and depression era would soon occur, and other than Dent who I already knew about, I only found about two or three other writers saying the same thing. However, in the last few years, I’ve learned of several more people who were publishing the same prediction back in 2007, so it brings the total of accurate predictors to about 8 individuals out of the thousands of economists and business writers.
From what I can tell, the difference of my predictions from the others, other than Dent, is that I was making my predictions based on a very fundamental economic model. Others were simply predicting based on their assessment of the statistics around 2007. But my predictions dated from 1990. In my papers, I explained the 80-year physics paradigm change model and other details of this model that most people still don’t believe. I described in more detail about what characterizes both types of depressions, and in my longer articles, I try to include more historical data concerning each of the 6 major Kondratiev wave dips since the late 1700s. To understand more about this model, you can read my papers online. It is a simple theory explaining the cause of scientific revolutions, and the economic model simply follows.

The Current Economic Situation

Since 2008, the Central Bank has been doing some amazing monetary actions and the government has kept expanding and providing jobs, food, and money to people. The Central Bank, the big banks, and the government has been following a money production and spending program that is different than the behavior of the US government and the banks in the first half of the Great Depression. So most Americans have not suffered as much as the people did in the 1930s so far. However, it is clear that this really is a depressionary decade.

Record Unemployment

Though official unemployment numbers have declined, the unemployment and disemployment are still at record levels as of 2014. People are working less hours, and their income and quality of work has decreased since 2007.

5.9% U3
11.8% U6
23.1 Shadowstats estimate in early fall, 2014

Table 1: Early fall, 2014, unemployment numbers.

So far, the unemployment during this depression is similar or a little worse than the 1970s-1982 deep recession and about a half of that of the Great Depression. In 1994, the government started to quote the U3 rate as the labor unemployment rate. It replaced a statistical number that is more similar to the current U6. It undercounts because it doesn’t count people who haven’t interviewed for a job in four weeks, and a part-time job is counted as a full time job. When a person with a full time job gets a part-time job, this side job is counted as job in the statistics of new jobs added to the economy.
Four out of five of the new jobs are considered low or minimum wage jobs.. Most of these jobs fall into catagories such as retail, hospitality, health, and temporary employment. I think that these new service jobs are a result of the booming stock market and cash creation. This gives the wealthy and some other people extra money for luxuries such as restaurant meals, vacations, vacation houses and other luxuries. So there is an increase in the number of service workers and laborers such as waiters, resort staff, hotel staff, people building vacation houses, and medical and health service workers. Much of this low paying work is done for the wealthy and elderly.
This stock bubble and the new low paying service jobs are similar to what happened at the end of the 1920s economic boom when there was a surging stock market. But these things are happening during a long wave depression era. It is said that the derivitives and stock speculation has reached record levels by the fall of 2014 that even exceed that at the time just before 2008.
92 million people are officially counted as not in the labor force in the US. This is the lowest labor force participation rate in 36 years. The largest part of the jobs added in the early fall of this year were given to people in the 55-69 age bracket. As in Europe, there is very high unemployment and low labor participation for people in their 20s and younger.

Government Deficits and Official Money Expansion

The offical Central Bank money creation program is unprecedented for peace time. The big banks’ derivitives program is also unprecedented. There have also been unprecedented federal deficits, and there is a correlation between deficits each year and the officially recognized money expansion each year.

The 10 years of the decade of the 1930s, 1931-1939 The 5 war years of World War II, 1941 – 1945 10 years during the third industrial revolution depression era (deep recession), 1973-1983 6 years of this technological acceleration depression, 2009 – 2014 During the next 7 years during the second dip, how much of GDP might be required to maintain this process?

2015-2022

3.8%

of GDP

19%

of GDP

5%

of GDP

7.1%

of GDP

?

Table 2: Comparison of deficit spending during the past crises. Remember that much GDP statistics are actually due to the money/debt creation.

So as shown in Table 2 above, deficit spending is now about twice the level in terms of GDP as during the Great Depression. What would have happened if the deficit spending had been less and more similar to the 1930s’ level? Probably, this depression decade would have been much worse in terms of what the average person feels about it.

There is a rough equivalence between Central Bank QE and the deficit in this depression era. See Table 3 below:

Year Deficit Spending and Percent of GDP QE
2009 1.4T 10% QE1 1.75T
2010 1.3T 10.5% QE2 .6T
2011 1.3T 8.5% Twist .4T
2012 1.1T 7% QE3 1T
2013 .68T 4.1% QE3 1T
2014 .5T 2.8% QE3 .5T
6 years = 6.28T

7.15% of GDP

= 4.25T

Table 3: You can see that year by year and total, there is a rough equivalence between QE and annual deficits. 6.28T for total deficit spending and 4.25T for total QE. QE3 is supposed to end this fall of 2014.

Up until October 2014, these are the official statistics. Shadowstats and others say the deficit spending is actually much higher. The official deficits seem to stay in line with the QE numbers.
The unprecedented central bank spending and derivities keep many banks operating. There are also unprecedented federal deficits. So thus far, the economic crisis doesn’t seem so severe to most people as did the middle of the Great Depression seem to the average person then. Thus far, though unemployment is at record highs matching or surpassing that of the 1970s long wave dip, it hasn’t reached the levels of the Great Depression. It is clear that the number of unemployed and bankrupt consumers is reduced by money creation by both governments and banks.

Predictions According to this Model

This model that was developed 25 years ago predicted a depression period for the 2010s lasting perhaps into the 2020s that would be due to the availability of important new kinds of products, the standardization of these products, and the cessation of the introduction of important new categories of products as has been usual for the period about 30 years after an industrial revolution. This model predicts that this depression era will be prolonged until at least about 2020 (because the technological acceleration depressions lasted about 13 years), the merger and acquisitions and associated unemployment will continue, there probably will be more personal and corporate bankruptcies, and productivity growth will continue to rise to a peak around 2032 and then decrease as the QM industries mature and experience innovation stagnation. The 2032 date is arrived at by adding 50 years to 1982. There was about a 50 year interval between the end of an industrial revolution depression and the time of the highest productivity growth in the two prior industrial eras in the middle 1800s and the middle 1900s.
This model predicted that this depression era would be due to the unusually heavy consumer and corporate debt loads that would accrue by the end of the decade of the 2000s and the economic consequences of the switch from product innovation to process innovation that would enable a productivity growth spurt starting about the year 2000. These economic consequences of the standardization of products and the cessation of new product innovation included the rise of oligopolies and monopolies, olipopoly price competition for standardized products through their usual labor layoffs, mergers and acquisitions, the automation of production, and a great rise in personal and corporate bankruptcies associated with a financial crisis similar to that of the late 1820s in Britain and the late 1920s in the US.
The period of the 1930s had three depression dips that seem to have been associated with the regular business cycle of recessions every 4 to 7 years. This depression era will also have at least one more dip that people will call “the double dip,” and there will probably be even more. It is during these times that disemployment and corporate and consumer bankruptcies will occur most heavily during this decade and the next matching what happened in the US in the 1930s and early 1940s.
This model doesn’t take into account exogenous factors such as major natural disasters, wars, or government or bank policies. These things can’t be foreseen in a theoretical way, but since the economic development of Britain during and after the First Industrial Revolution and the economic development of the US during and after the Second Industrial Revolution were so similar, in the late 1980s that was just after the Third Industrial Revolution, I thought I could identify the main economic factors arising from science and technology paradigm change and so described this model.
The governments of the US and the other most advanced industrialized countries and the central banks and the big banks of these countries have followed a monetary and spending course that is unprecedented by Britain and America during the two scientific-industrial paradigms from 1800 to 1980. I believe that these policies are factors endogenous to this model. This depression period would have happened even with better government and banking policies because this depression is due mainly to the standardization of products and oligopoly and monopoly markets and the investment and marketing strategies of the main players. Perhaps the unprecedented government spending and currency and derivitive spending has so far kept the people from experiencing the bankrupticies of banks on the scale of the 1930s and the more severe visible poverty of the early to middle 1930s.
I think the great increase of government debt, derivitive creation, and bank currency making is ominous and can’t really produce any good result for most Americans. But I can’t predict what will happen because of this by only basing my predictions on what is in this model since this model doesn’t consider this exogenous factor. This model is about the characteristic economic effects of periodic scientific and technological change.
In general, I think that this depression will grow worse for the average American, with rising rates of unemployment and an increase of poverty during the next seven years. But as happened in the 1930s, I think a small segment of the population, the ones who control the oligolopies, banks and the government, might grow wealthier in terms of ownership and control of the land, the resources, and the productive power.
Since the government and banking policies are so different than those of the technological acceleration depression eras of the 1830s, 1840s, and 1930s, I can’t suppose what the next 15 years will hold for sure. But I’m describing what the model itself predicts. In the last two technological eras, the economies emerged from their technological acceleration depression eras within 15 years or so after the depression started. The model would predict that this will happen again. Other than what I’ve predicted here, I don’t know what else to predict based on this model since I don’t know what will happen about war, natural disasters, and government and bank policies. At best, these actions have only delayed the worse features of this depression for some years. At worst, the economic catastrophe will be extremely severe and more severe than the 1930s depression.

Summary

I tried to give an overview of this economic model and quoted some predictions that were written in the past 22 years before this current depression period started in 2008. Then in the third part about predictions according to this model, I wrote some more predictions about what will happen in the next twenty or thirty years describing how this depression might play out according to this model and how productivity growth will continue to increase until a peak about 2030 and then go to the characteristic low marking the end of the quantum mechanics based industries. By including quotes from old articles, I showed that the model predicted that the industrial revolution underway in QM based industries would bring about a doubling of productivity growth by about 2000, an economic boom like the 1920s boom in the first decade of the 2000s, and a long wave technological acceleration depression like the Great Depression starting with a financial crash about 2009 and extending for at least 12 years.
Because government and central bank policies are so different than in the prior two technological depression eras of the 1830s and 1840s and 1930s and 1940s, the outcome might prove to be very different than in the past. In the past, the leading economies of Great Britain and the US weathered their depressions and reemerged in a period of prosperity. Great Britain did so without any major wars in the 1840s, and the US also emerged from its depression era in the 1840s without major wars. The main part of America’s 1830s-1840s depression was over by 1843. Funding the Mexican American War may have contributed some production stimulus in the middle of the 1840s, but it was a relatively minor war compared to the size of the country’s economy then.
The US emerged from WWII with clear economic dominance, and the high level of federal deficit spending of about 19% of GDP during the war years seemed to contribute to ending the depression era. But based on the record of both Great Britain and the US in the similar depression era of the 1830s when they recovered without major war, I think the US economy might have recovered in the 1940s even if there was no war.
In both the US by the 1940s and Great Britain by the 1840s, every industry was clearly monopolized or oligopolized by the end of their depressions. Productivity growth was very high during those decades which helped spur a second boom in the economies of both countries in their respective season of world dominance. During this decade, even tighter oligopolies will form in each industry, but it seems to me that the result of the current policies will be to deindustrialize the US and straddle the country with such huge debts that it could grow weaker, so economic leadership may pass to other countries. On the other hand, other major technologically advanced competitors such as Japan or Germany also have record high levels of bank money creation and government debt, so maybe the US will continue as a technology leader.
Because there is much potential for process innovation in terms of achieving automation of production and economies of scale, whichever country or regional economy that has the technological leadership will enjoy booming labor productivity growth rates probably reaching a peak of at least 4 percent per year growth by 2025. I get this number by extrapolating on the productivity growth behavior in this quantum mechanics paradigm compared to the prior two paradigms. Actually, the productivity growth rates may be 4.5 percent or more by 2025 judging from the doubling jump from the 1970s trough to 2000. Computerization and robotic technology clearly has the potential for great labor saving gains in both the survice and manufacturing industries.
How such an economy may have full employment after this depression era isn’t clear to me since most of the usual production can be handled by robots and computers. The new 3D production technology will stimulate growth and innovation, but will it help the lead economy reach what has been considered to be full employment? The model predicts that there will be full employment and robust growth since that was the experience of Britain in the middle 1800s and the US in the middle 1900s. This depression era may last longer than those of the 1830s and 1930s because of the government and bank actions of the last 15 years.
It still remains to be seen whether another physics paradigm will replace quantum mechanics. I write about this much in other articles. If another physics paradigm doesn’t develop or at least some products of the new paradigm are not introduced, then industrial innovation will come to a halt at the time of decline of the quantum mechanics based industries after 2040. In my other articles, I explained how people working according to a dominant obsolescent scientific paradigm can still innovate products of a newer set as did the European inventors who believed in Fluid theory in the middle 1800s when Field theory was developing. They were able to invent important revolutionary electromagnetic products such as the telegraph though their theory was obsolescent. So maybe new energy and material manufacturing technology will be introduced by people who believe in quantum mechanics from the Plasmoid paradigm set that is the set of phenomena that was discovered in the last crisis period. Unless you are familiar with the field, this might be hard for you to understand.
This economic model rests on a simple model of scientific paradigm change in the field of physics that is described in much more detail in my book and articles online. In general, expect this depression era will turn more severe in the next few years for the average American and European although the economic leaders may gain great power and wealth in the world. I’m guessing that the recent government and bank behavior may make this depression extend out for more years past the 12 or so years that seem to be regular for these kinds of depressions that occur during technological acceleration eras, but the model itself doesn’t predict that. I’ve noticed in the last 25 years that my conjectures for economic predictions based on assumptions and ideas other than this model have proved much less accurate than the model’s predictions.

Edward Lewis
December 27, 2014
sciencejunk.org

The 25 Year-Old Economic Depression Model and Predictions

The Great Depression

(Guest article by Edward Lewis of sciencejunk.org) The world economy is in the middle of a depression period that will last the rest of this decade and perhaps well into the 2020s. This depression period and the others that the world has experienced since the late 1700s were due to an 80 year cycle of change in physics and technology development. Twenty-five years ago, this author developed an economic model concerning this relationship between physics paradigm changes and depressions and described the model and the evidence for it in a book titled: The Periodic Production of Rationalized Phenomena and the Past Periodic Depressions. I then predicted, based on the model, that there would be an economic boom in the countries that led in the development of Quantum Mechanics-based technology in the first decade of this century followed by a financial crisis around 2009 and a long depression period perhaps lasting 12 years. The prediction proved correct. Unprecedented peacetime lending and currency creation has kept the usual depression symptoms at bay, but conditions will get worse during this decade. Here’s the model, some information about the current economic situation, and predictions.

Economic Depression Model

In the early and middle 20th century, economists such as Kondratiev and Schumpeter identified a cycle in advanced economies that was known as the “long wave” or Kondratiev wave. They thought that the cycle lasted about half a century. This assumption was mainly based on the depressions of the 1800s that happened about 50 years apart. But actually, these major depressionary eras tend to happen 40 years apart as I discovered in the late 1980s. The economic long wave in advanced societies is due to the technological change that is due to paradigm changes in physics that happened about every 80 years.

Thomas Kuhn wrote about how these instances of physics paradigm change happened, but he never described that they happen 80 years apart or that they had any regular timing to them. But the regular timing is clear: historically they have happened from 73 to 87 years apart. What does it mean that a physics paradigm change happens? It means that large groups of people think about the world differently than earlier generations, and they development new kinds of technology and products. These products, new technologies, and new industries start to appear about 20 years after the theory of the paradigm is well developed around the time of the “crisis period” at the end of each physics paradigm.

I wrote a whole book and many papers about this in the 1990s, and some of these can be found on my site, sciencejunk.org, or published in various places. The economics model is simple and based on the work of Kondratiev, Kuznets, and J. Waters mainly. So if this model interests you, you can read about it online. The book goes into a lot of detail explaining the history of science.

Industrial Revolution Depressions

Franklin’s Fluid paradigm was developed by Aepinus, Lavoisier, Coulomb and many others in the period from about 1750 to 1785, and it led to the development of industries relatively quickly because his paradigm was accepted and adopted in advanced countries quite rapidly. Young people such as Watt started to make devices based on the conception of fluids of heat, electricity, and magnetism that each had their own unique properties. Watt developed a good steam engine design that was adopted to power many industries during the First Industrial Revolution of the 1790s and early 1800s. So labor productivity in Britain started to rise out of the depression era of the 1780s and 1790s.

Likewise, Faraday’s conception of point atoms and lines of force that extended from them was developed by Maxwell around 1865. Twenty years later, researchers such as Hertz, Tesla and Edison started to make the technology of the 20th century. There was an industrial revolution in the 1890s and early 20th century. Due to the depletion of the technology potential of the Fluid paradigm and the small size of the nascent Field theory based industries, as well as other factors all stemming from this change of technology, there was a depression period in the US and Great Britain in the 1890s. As the new industries of the Field paradigm grew, productivity growth started to increase in the first decade of the 20th century from its low during that depression period.

Similarly, Einstein’s model of quanta of energy and space-time change to describe gravity was well developed as two different theories called Quantum Mechanics and General Relativity. These two theories make up the Einstein paradigm, and they were both well developed by about 40 years after 1905 that was when he formulated this paradigm. Again, 20 years after the theory was well developed around 1965, young inventors started to innovate the main products of this technology paradigm such as lasers, computer chips, and PCs. Due to the depletion of the technological potential of the field theory paradigm and the development of the new technologies, there was a depressionary era in the 1970s and 1980s coinciding with the third industrial revolution of those decades.

The above is a short outline for why the industrial revolution depressions were timed as they were in the 1780s-1790s, 1880s-1890s, and 1970s-the early 1980s. For more information, read my articles on sciencejunk.org. In my book that was written mostly in the early 1990s, I explain this model in greater detail.

Technological Acceleration Depressions

For the last two centuries, after about 20 years after the end of an industrial revolution depression, there has been a sudden doubling of labor productivity growth. Joseph Waters pointed out this acceleration of productivity growth rates in his book Technological Acceleration and the Great Depression. When I found this book in 1989, it helped me understand how productivity growth acceleration in the US caused the Great Depression. There was a similar doubling in the 1820s in Great Britain when it was the technology leader of the Fluid paradigm industries.

The doubling of growth happens because people in the industries of a paradigm switch their product innovation from product introduction to process innovation. During an industrial revolution, the generation of young inventors such as Edison focus on designing and introducing new kinds of products. These products are revolutionary, and spur great demand. But 20 years later, the industries standardize so that the people focus on producing the standardized products cheaply and are in competition for market share in markets that become oligopoly markets. The same features can be seen in the economies of Great Britain in the 1820s, the US in the 1920s, and the US in the decade of the 2000s.

Automation, economies of scale, and capturing the market for a standardized product became the emphasis, and the competition between the many companies in each industry was price competition and merger and acquisition activity. Through heavy borrowing and offering consumers credit, some companies expanded, automated production to reduce prices, and survived in oligopoly or monopolistic markets while the other companies were absorbed or went bankrupt. We saw this happen during the last decade when oligopolies emerged in the US. The remaining companies unemployed of a large part of the workforce through their acquisition and streamlining of production processes.

The switch from product to process innovation is what caused the technological acceleration depressionary periods of the 1830s-1840s, 1930s-early 1940s, and now. So there was a standarization of available products, a lack of new product innovation for revolutionary new products that would allow for new markets, and a great increase in unemployment or disemployment. Since the US was the technological follower of Great Britain, the country entered its depression era about 8 years after Britain did starting from 1837 with a large number of bank closures.

In 1989, I realized that by the regular timing of depressions of the past of the 80-year physics paradigm change process causing depressions about every 40 years, there was going to be a depressionary period of the technological acceleration type that would commence about the year 2009 although I wasn’t sure my model was accurate enough to pinpoint 2009 as the exact year. But the model did prove very accurate, and the depression era commenced in 2008.

Past Predictions as Evidence for the Model’s Accuracy

I’ve been writing about this depressionary period of the 2010s for 25 years after I developed this model in 1989. The model explains why the long wave happens as a result of paradigm changes in physics. The predictions matched what has happened for the last 25 years is evidence that this model is accurate.

In the early 1990s, I wrote:

“Scientific revolutions have happened at about 80 year intervals, and these have caused “technological revolutions” at about 80 year intervals and economic depressionary

periods about every 40 years. The periodic depressions have been called Kondratiev depressions.” Introduction to The Periodic Production of Rationalized Phenomena and the Past Periodic Depressions, 1996.

In the middle of the 1990s, I wrote:

“If the trend of economic development continues as it has for the past 200 years, the peoples who lead in the production of Q.M.-type phenomena will undergo the first kind of depressionary period about the year 2010 or 2020 unless there will be some type of financial collapse. It is interesting to me that economists such as Dent are also predicting a depressionary period about the years 2010 or 2020 based on generational life-cycle theory.” Introduction to The Periodic Production of Rationalized Phenomena and the Past Periodic Depressions, 1996.

So 20 years ago, I tried to bracket out in my online introduction to my book the time when the technological revolution depression would happen based on my model. I wasn’t totally sure about the 2010 date although I thought this depression would follow along on the 40 year timing, so I included 2020 as a possible late date just in case the 2010 date was too early. As you can see, I was basically predicting that the decade of the 2010s would be the depression period. What I meant about including the phrase “unless there will be some type of financial collapse” is that I was thinking the financial markets could collapse before 2009 since it seemed that a disaster or some other trigger might cause a financial crisis given the record high government debts. Though there were financial crises between 1996 and 2008, none was severe enough to start a depression. By this time, in 1996, I had read Dent’s book and his economic predictions based on demographics, and I was surprised that such a different model predicted the same time for this depression period.

I tried to publish the book and my articles during the 1990s. But almost no one believed me. People who believed in economic long waves then mostly predicted that a depression would occur in the 1990s based on their assumption that these depressions happen every 50 or 60 years and that the last such depression was the 1930s Great Depression. They didn’t believe that the 1970s great recession was actually a Kondratiev long wave dip, and they didn’t believe that there are two alternating types of depressions.

In 1998, I was blogging on early long-wave discussion forums and telling people that an economic boom was about to start that would be similar to the 1920s boom period with its doubling of productivity growth rates. Though few people believed or agreed with what I was saying since most of the long wave bloggers were thinking that the US was in a long wave depression era then, I was predicting an 10 year economic boom was starting. In a note attached in May 28, 1998 to the the 1996 article cited above, I wrote:

“According to the theory, barring unforeseen disasters, even more rapid industrial development and higher growth rates are predicted for the future. Specifically, during the next 10 years the most advanced economies will experience economic development in many ways similar to the period from 1917-1929 in the U.S., a time when the U.S. economy boomed and entire industries were developed. That was a time of great social change.” Note on the Introduction to The Periodic Production of Rationalized Phenomena and the Past Periodic Depressions, put online in 1998. www.padrak.com/ine/ELEWIS6.html

It is clear that this prediction about the period 1999-2008 proved accurate though almost no one I knew

about but Harry Dent was writing the same thing.

By 2003, it was clear to me that the technological acceleration had started just as I predicted it would about the year 2000, and it was clear that the US was in a boom period with high borrowing just as I predicted. It was also clear to me that this science-economic model proved accurate enough that a new major depression period was about to start about 2009. I calculated the date 2009 from the pattern of the 1920s. The productivity growth doubling happened in 1919, and the depression started with a financial crash 10 years later in 1929. So I thought that a financial crash and a depression would start about 2009 or 10 years after the productivity growth doubling of 1999. So I tried to warn people about this imminent depression and financial crash, and after several attempts of sending to journals and magazines, I eventually published a letter in a small science magazine.

In that letter, in late 2007, I wrote:

“If any of these predictions hadn’t turned out to be so accurate, it would have disproved this theory. But since these predictions from 1990 have proved so accurate, it seemed proper to warn people of a possible depression or deep recession in the near future. Even if the idea of an 80 year periodicity of revolutions seems untrue to you, if these trends continue of rising productivity due to the displacement of labor by automation, oligopoly and efficiencies of scale, increasing business and consumer debt, and the satiation of consumer demand of the available types of products within the constraints of their budgets, what will the outcome be but a general decrease of consumption demand?” “Economic Depression or Deep Recession Coming Soon, ” May, 2008. tc38.metawerx.com.au/oldsite/LewisLetter79.pdf

In the middle of the last decade, merger and acquisition activity had reached a new high in the US, and I saw other data that reminded me of the 1920s such as the high consumer and corporate debt. It was clear that products were standardizing and that the major quantum mechanics based industries were becoming oligopoly markets and were rapidly automating. In late 2007, I thought that unemployment would soon quickly spike due to the merger and acquisitions and the automation of production similar to what happened in 1929. So I titled this letter: “Economic Depression or Deep Recession Coming Soon.”

In the late 2007 letter to the editor, I also wrote:

“In 2007, the stock market reached record highs. Americans are also working record hours per week and the unemployment rate this decade has been lower than any decade since the 1960s. Many American states have record low unemployment. Since August 1982, when it bottomed at 776, the Dow has risen almost 1,700%. That ascent reflects an economy that has nearly tripled from $5.2 trillion in 1982, adjusted for inflation, to $13.9 trillion today. Extremely high debt levels were predicted for the lead economy. This is evident. As happened in the late 1920s, the U.S. has record business and private debt as businesses struggle to survive as oligopolies formed in each industry and the survivors tried to gain market share. In 2005 and 2006 a record was set for mergers and acquisitions in the U.S. economy. Mergers and acquisitions are at the highest level since the Great Depression.”

“Total corporate debt that has financed the corporate drive for market share and for corporate survival is the highest since the Great Depression. Total American consumer debt

reached $2.2 trillion in 2005, up from $1 trillion in 1994. And, 2005 was a record year for personal bankruptcies.” “Economic Depression or Deep Recession Coming Soon, ” May, 2008. tc38.metawerx.com.au/oldsite/LewisLetter79.pdf

This letter was sent to a little magazine called Infinite Energy in December of 2007, and it was eventually published in May of 2008. It is a good record that I was warning people about the imminent K-wave depression period and that this depression would be like the 1920s depression. I explained the causes of the imminent depression and what the depression would be like. It explained that it was all due to the transitioning of the QM based industries from product innovation to emphasizing process innovation. However, I couldn’t get published in other journals or magazines though I tried to submit my articles and letters to a handful of publications during several months.

At the time I wrote this letter in late 2007, I looked online for people who were predicting that a financial crisis and depression era would soon occur, and other than Dent who I already knew about, I only found about two or three other writers saying the same thing. However, in the last few years, I’ve learned of several more people who were publishing the same prediction back in 2007, so it brings the total of accurate predictors to about 8 individuals out of the thousands of economists and business writers.

From what I can tell, the difference of my predictions from the others, other than Dent, is that I was making my predictions based on a very fundamental economic model. Others were simply predicting based on their assessment of the statistics around 2007. By my predictions dated from 1990. In my papers, I explained the 80-year paradigm change model and other details of this model that most people still don’t believe. I described in more detail about what characterizes both types of depressions, and in my longer articles, I try to include more historical data concerning each of the 6 major Kondratiev wave dips since the late 1700s. To understand more about this model, you can read my papers online.

The Current Economic Situation

Since 2008, the Central Bank has been doing some amazing monetary actions and the government has kept expanding and providing jobs, food, and money to people. The Central Bank, the big banks, and the government has been following a money production and spending program that is different than the behavior of the US government and the banks in the first half of the Great Depression. So most Americans have not suffered as much as the people did in the 1930s so far. However, it is clear that this is really a depressionary decade.

Record Unemployment

Though official numbers have declined, the unemployment and disemployment are still at record levels as of 2014. People are working less hours, and their income and quality of work has decreased since 2007.

So far, the unemployment during this depression is similar or a little worse than the 1970s-1982 deep recession and about a half of that of the Great Depression. In 1994, the government started to quote the U3 rate as the labor unemployment rate in 1994. It replaced a statistical number that is more similar to the current U6. It undercounts because it doesn’t count people who haven’t interviewed for a job in four weeks, and a part-time job is counted as a full time job. When a person with a full time job gets another part-time job, this side job is counted as job in the statistics of new jobs added to the economy.

Four out of five of the new jobs are considered low or minimum wage jobs. Most of these jobs fall into categories such as retail, hospitality, health, and temporary employment. I think that these new service jobs are a result of the booming stock market and cash creation. This gives the wealthy and some other people extra money for luxuries such as restaurant meals, vacations, vacation houses and other luxuries. So there is an increase in the number of service workers and laborers such as waiters, resort staff, hotel staff, people building vacation houses, and medical and health service workers. Much of this low paying work is done for the wealthy and elderly.

This stock bubble and the new low paying service jobs are similar to what happened at the end of the 1920s economic boom when there was a surging stock market. But these things are happening during a long wave depression era. It is said that the derivatives and stock speculation has reached record levels by the fall of 2014 even exceeding the time just before 2008.

92 million people are officially counted as not in the labor force in the US. This is the lowest labor force participation rate in 36 years. The largest part of the jobs added in the early fall of this year were given to people in the 55-69 age bracket. As in Europe, there is very high unemployment and low labor participation for people in their 20s and younger.

Government Deficits and Official Money Expansion

The official Central Bank money creation program is unprecedented for peace time. The big banks’ derivatives program is also unprecedented. There have also been unprecedented federal deficits, and there is a correlation between deficits each year and the officially recognized money expansion each year.

So deficit spending is now about twice the level in terms of GDP as during the Great Depression. What would have happened if it had been less and more similar to the 1930s’ level? Probably, this depression decade would have been much worse in terms of what the average person felt about it.

There is a rough equivalence between Central Bank QE and the deficit in this depression era.

Up until October 2014, these are the official statistics. Shadowstats and others say the deficit spending is actually much higher. The deficits seem to stay in line with the QE numbers.

The unprecedented central bank spending and derivatives keep many banks operating. There are also unprecedented federal deficits. So thus far, the economic crisis doesn’t seem as severe to most people as did the middle of the Great Depression seem to the average person then. Thus far, though unemployment is at record highs matching or surpassing that of the 1970s long wave dip, it hasn’t reached the levels of the Great Depression. It is clear that the number of unemployed and bankrupt consumers is lessened by money creation by both governments and banks.

Predictions According to this Model

This model that was developed 25 years ago predicted a depression period for the 2010s lasting perhaps into the 2020s that would be due to the availability of important new kinds of products, the standardization of products, and the cessation of the introduction of important new categories of products as has been usual for the period about 30 years after an industrial revolution. This model predicts that this depression era will be prolonged until at least about 2020, the merger and acquisitions and associated unemployment will continue, there probably will be more personal and corporate bankruptcies, and productivity growth will continue to rise to a peak around 2032 and then decrease as the QM industries mature.

This model predicted that this depression era would be due to the unusually heavy consumer and corporate debt loads that would accrue by the end of the decade of the 2000s and the economic consequences of the switch from product innovation to process innovation that would enable a productivity growth spurt starting about the year 2000. These economic consequences of the standardization of products and the cessation of new product innovation included the rise of oligopolies and monopolies, oligopoly price competition for standardized products through their usual labor layoffs, mergers and acquisitions, the automation of production, and a great rise in personal and corporate bankruptcies associated with a financial crisis similar to that of the late 1820s in Britain and the 1920s in the US.

The period of the 1930s had three depression dips that seem to have been associated with the regular business cycle of recessions every 4 to 7 years. This depression era will also have at least one more dip that people call “the double dip,” and there will probably be even more. It is during these times that disemployment and corporate and consumer bankruptcies will occur most heavily during this decade and the next matching what happened in the US in the 1930s and early 1940s.

This model doesn’t take into account exogenous factors such as major natural disasters, wars, or government or bank policies. These things can’t be foreseen, but since the economic development of Britain during and after the First Industrial Revolution and the economic development of the US during and after the Second Industrial Revolution were so similar, in the late 1980s that was just after the Third Industrial Revolution, I thought I could identify the main economic factors arising from science and technology paradigm change and so described this model.

The governments of the US and the other most advanced industrialized countries and the central banks and the big banks of these countries have followed a monetary and spending course that is unprecedented by Britain and America during the two scientific-industrial paradigms from 1800 to 1980. I believe that these are policies are factors endogenous to this model. This depression period would have happened even with better government and banking policies, and perhaps the unprecedented government spending and currency and derivatives spending has so far kept the people from experiencing the bankruptcies of banks and the more severe visible poverty of the early to middle 1930s.

I think the great increase of government debt, derivatives creation, and bank currency making is ominous and can’t really produce any good result for most Americans. But I can’t predict what will happen because of this by only basing my predictions on what is in this model since this model doesn’t consider this exogenous factor. This model is about the characteristic economic effects of periodic scientific and technological change.

In general, I think that this depression will grow worse for the average American, with rising rates of unemployment and an increase of poverty during the next seven years. But as happened in the 1930s, I think a small segment of the population, the ones who control the oligopolies, banks and the government, might grow wealthier in terms of ownership and control of the land, the resources, and the productive power.

Since the government and banking policies are so different than those of the technological acceleration depression eras of the 1830s, 1840s, and 1930s, I can’t suppose what the next 15 years will hold. In the last two technological acceleration eras, the economies emerged from their depression eras within 15 years or so. But other than what I’ve predicted here, I don’t know what else to predict based on this model since I don’t know what will happen about war, natural disasters, and government and bank policies. At best, these actions have only delayed the worse features of this depression for some years. At worst, the economic catastrophe will be extremely severe and more severe than the 1930s depression.

Summary

I tried to give an overview of this economic model and quoted some predictions that were written in the past 22 years before this current depression period started in 2008. Then in the third part, I wrote some more predictions about what will happen in the next twenty or thirty years describing how this depression might play out according to this model and how productivity growth will continue to increase until a peak about 2030 and then go to the characteristic low marking the end of the quantum mechanics based industries. By including quotes from old articles, I showed that the model predicted that the industrial revolution underway in QM based industries would bring about a doubling of productivity growth by about 2000, an economic boom like the 1920s boom in that decade of the 2000s, and a long wave technological acceleration depression like the Great Depression starting with a financial crash about 2010 and extending for at least 10 years.

Because government and central bank policies are so different than in the prior two technological depression eras of the 1830s and 1840s and 1930s and 1940s, the outcome might prove to be very different than in the past. In the past, the leading economies of Great Britain and the US weathered their depressions and reemerged in a period of prosperity. Great Britain did so without any major wars in the 1840s, and the US also emerged from its depression era in the 1840s without major wars. The main part of America’s 1830s-1840s depression was over by 1843. Funding the Mexican American War may have contributed some production stimulus in the middle of the 1840s, but it was a relatively minor war compared to the size of the country’s economy then.

The US emerged from WWII with clear economic dominance, and the high level of federal deficit

spending of about 19% of GDP during the war years seemed to contribute to ending the depression era. But based on the record of both Great Britain and the US in the similar depression era of the 1830s, I think the US economy might have recovered in the 1940s even if there was no war.

In both the US by the 1940s and Great Britain by the 1840s, every industry was clearly monopolized or oligopolized by the end of their depressions. Productivity growth was very high during those decades which helped spur a second boom in the economies of both countries in their respective season of world dominance. During this decade, even tighter oligopolies will form in each industry, but it seems to me that the result of the current policies will be to deindustrialize the US and straddle the country with such huge debts that it could grow weaker, so economic leadership may pass to other countries. On the other hand, other major technologically advanced competitors such as Japan or Germany also have record high levels of bank money creation and government debt, so maybe the US will continue as a technology leader.

Because there is much potential for process innovation in terms of achieving automation of production and economies of scale, whichever country or regional economy that has the technological leadership will enjoy booming labor productivity growth rates probably reaching a peak of at least 4 percent per year growth by 2025. I get this number by extrapolating on the productivity growth behavior in this quantum mechanics paradigm compared to the prior two paradigms. Actually, the productivity growth rates may be 4.5 percent or more by 2025 judging from the doubling jump from the 1970s trough to 2000. Computerization and robotic technology clearly has the potential for great labor saving gains in both the service and manufacturing industries. How such an economy may have full employment after this depression era isn’t clear to me since most of the usual production can be handled by robots and computers. This depression era may last longer than those of the 1830s and 1930s because of the government and bank actions of the last 15 years.

It still remains to be seen whether another physics paradigm will replace quantum mechanics. I write about this much in other articles. If another paradigm doesn’t emerge or at least products of the new paradigm are not introduced, then industrial innovation will come to a halt at the time of decline of the quantum mechanics based industries after 2040. In my other articles, I explained how people working according to a dominant obsolescent scientific paradigm as did the European inventors who believed in Fluid theory in the 1800s who were able to invent important revolutionary products such as the telegraph. So maybe new energy and material manufacturing technology will be introduced by people who believe in quantum mechanics from the Plasmoid paradigm set that is the set of phenomena that was discovered in the last crisis period.

This economic model rests on a simple model of scientific paradigm changes in the field of physics that is described in much more detail in my book and articles online. In general, expect this depression era will turn more severe in the next few years for the average American and European although the economic leaders may gain great power and wealth in the world. The government and bank behavior may make this depression extend out for more years past the 12 or so years that seems to be regular for these kinds of depressions that occur during technological acceleration eras.

 

 

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