This Is What A Recession Looks Like – Here Are 12 Big Companies That Are Conducting Major Layoffs

Do you remember what it was like in 2008 when it literally felt like no job was truly safe? It was a terrible time, and many fear that we could soon be facing a similar scenario. In recent days, big companies all across America have been laying off workers at a frightening pace. As economic activity has slowed down, a lot of firms are feeling compelled to slash their payrolls, and if a deep recession is ahead of us then what we have seen so far could be just the tip of the iceberg. In 2008 and 2009, millions of Americans lost their jobs very rapidly, and it could very easily happen again.

As I have been conducting research over the past few days, I have been struck by the stunning number of layoff announcements that are suddenly popping up in the news. Here are 12 of the most prominent examples…

#1 HP Inc: “U.S. personal computer maker HP Inc said on Thursday it will cut up to 16% of its workforce as part of a restructuring plan aimed at cutting costs. The company will cut about 7,000 to 9,000 jobs through a combination of employee exits and voluntary early retirement, it said in a statement.”

#2 WeWork: “WeWork, the co-working business once valued at $47 billion, is expected to announce significant layoffs this month, Bloomberg reports. This follows reports the company was looking to slash as many as 5,000 roles, or one-third of its workforce.”

#3 Kroger: “Kroger is laying off hundreds of employees across the family of grocery stores it owns, a person familiar with the situation tells CNBC.”

#4 Sports Illustrated: “The revered 65-year-old Sports Illustrated magazine is in a state of bedlam. In meetings Thursday afternoon, managers told staff members that about half the newsroom would be laid off, according to two people present at the meetings.”

#5 Uber: “The 435 employees cut from Uber include members from its product team and engineering team.”

#6 John Deere: “John Deere is set to layoff more than 150 workers at two of its plants in the Quad-Cities.”

#7 Bayou Steel Group: “According to Market Realist, Bayou Steel Group filed for bankruptcy on Tuesday and the company laid off 376 workers. U.S. Steel and ArcelorMittal also curtailed some of their facilities. U.S. Steel idled two of its US blast furnaces earlier this year and the company expects those blast furnaces to be idle until at least the end of the year.”

#8 Elanco: “Elanco Animal Health Inc. which went public a year ago, on Monday said it plans to lay off 250 workers to save $12 million in 2020.”

#9 Lazard Asset Management: “Lazard Ltd. is cutting up to 7% of its employees in its asset-management division and closing some investment funds by year’s end, people familiar with the matter said, amid a tougher climate for money managers.”

#10 Advance Engineering Corporation: “Advance Engineering Corporation, Elgin, permanent closing due to relocation affecting 114 employees. First layoff date is Nov. 4, with layoffs to be completed by Dec. 31.”

#11 Daimler Trucks North America: “The company is laying off 450 workers at its Mount Holly plant and about the same number at its plant in Cleveland.”

#12 Genesis Healthcare: “Genesis Healthcare, in a statement to McKnight’s on Wednesday said it has reorganized its therapy gyms in response to PDPM and other industry changes. The company laid off 585 out of about 10,000 Genesis Rehab employees.”

This isn’t what a “booming economy” looks like.

In fact, this is precisely what we would expect to see as the U.S. economy plunges into a major economic downturn.

Of course a lot of people out there don’t want to believe that this is actually happening. There are many that have absolutely convinced themselves that the good times will keep rolling indefinitely, even though all of the evidence is pointing to the contrary.

On Wall Street, investors are trying to make sense of all the negative data that we have been receiving lately, and many of them are starting to become quite nervous

Lagging or leading, macro or micro, global or domestic. For investors, all that matters to keep the bull market intact is whether this week’s torrent of data is flashing a recession ahead or just a few local shocks.

In a market so divided on the outlook, every piece of data holds the prospect of vindication or rebuttal — and numbers on Thursday just handed fresh ammo to the bears. A U.S. services gauge dropped to a three-year low in September and jobless claims rose more than expected, shortly after a euro-zone report showing a factory slump has spread to services.

Needless to say, all of the chaos in Washington is certainly not going to help matters. The federal government will be paralyzed while this impeachment inquiry plays out, and Democrats are hoping to have articles of impeachment ready for a vote around Thanksgiving.

And I know that a lot of people don’t want to hear this, but Nancy Pelosi believes that she already has the votes that she needs.

That means that President Trump could be headed for impeachment, and a Senate trial would unleash chaos all over America. We are already a deeply, deeply divided nation, and their entire saga is going to make things much worse.

You see, the truth is that our economic problems are not just happening in a vacuum. There are many different elements to the emerging “perfect storm”, and they are all going to feed into one another.

So buckle your seat belts and get prepared for rougher times, because this drama is only in the very early chapters.

About the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time. Of course the most important thing that we can share with people is the gospel of Jesus Christ, and if you would like to learn more about how you can become a Christian I would encourage you to read this article.

Stock Prices Are Plunging, And Many Fear This Could Be Another “Black October” For The Stock Market

The stock market hasn’t started a quarter this badly in about a decade, and if stock prices continue to plummet it could set off a wave of panic selling unlike anything that we have seen in a very long time. Of course it wouldn’t be the first time that we have seen a major stock market crash during the month of October. If I mention “October 1929”, you immediately know what I am referring to, and the same thing is true for October 1987 and October 2008. Today, we are facing a global economic slowdown, an impeachment crisis in Washington and a rapidly escalating trade war simultaneously, and it seems like almost everyone on Wall Street is suddenly talking about “the coming recession”. In such an environment, any piece of bad news is going to push stocks lower, and that is certainly what happened on Wednesday

Stocks fell sharply on Wednesday, adding to Wall Street’s poor start to the final quarter of 2019 as investors grapple with fears of an economic recession.

The Dow Jones Industrial Average declined by 494.42 points, or 1.9% to close at 26,078.68. The Dow also broke below its 50-day and 100-day moving averages, two technical levels watched by traders. The S&P 500 lost 1.8% to 2,887.61 to fall below its 100-day moving average as the tech sector dropped 2%. All 11 S&P 500 sectors were down, with 10 of them sliding at least 1.2%.

Overall, the Dow Jones Industrial Average was down more than 800 points over the first two days of this month, and that makes this the worst start to a quarter for the stock market since 2009.

As I have repeatedly warned my readers, the stock market is more primed for a crash than it has ever been before in all of U.S. history, and investors are becoming increasingly concerned that the party is finally over.

And without a doubt, those in the financial community are very well aware of what has happened during previous Octobers, and that is making everyone just a little bit extra jittery right now

The market is turning into a “sell first and ask question later market,” said Ryan Detrick, senior market strategist for LPL Financial.

“October is known for being one of the most volatile months and after two days, it is living up to that reputation,” Detrick added.

If a way to resolve our trade war with China could be found, that would greatly calm the markets.

Unfortunately, that isn’t going to happen. Instead, the Trump administration just decided to escalate our trade war with Europe. The following comes from Zero Hedge

In the aftermath of today’s surprising WTO decision, in which the global trade mediator sided with the US in finding some $7.5BN in European Airbus subsidies illegal, moments ago the US Trade Rep confirmed that the US will waste no time in retaliating to what – for years – were illegal trade practices.

According to the USTR office, the US will impose a total of $7.5 billion in retaliatory tariffs on EU imports starting October 18, with 10% tariffs on large commercial aircraft, and 25% on agricultural and other industrial goods.

Needless to say, the Europeans are going to retaliate, and global trade will take another big hit.

Most Americans still seem to think that everything is going to work out just fine somehow, but the truth is that this economic downturn is starting to become really painful.

Nearly every day we are getting more bad economic numbers, and that was definitely true on Wednesday. The following comes from Bloomberg

U.S. auto sales took a big step back in September, setting the stage for hefty incentive spending by carmakers struggling to clear old models from dealers’ inventory.

Results were disastrous for leading Asian automakers Toyota Motor Corp. and Honda Motor Co., which both suffered double-digit declines that were worse than analysts anticipated. While a fuller picture will emerge Wednesday when General Motors Co. and Ford Motor Co. are due to report, the poor performance suggests that overall deliveries of cars and light trucks could come in worse than the 12% drop anticipated by analysts, based on six estimates.

Even worse than a 12 percent decline?

If the U.S. economy really was in “good shape”, this would not be happening. In fact, this is the kind of number that we would expect to see in the middle of a very deep recession.

Meanwhile, we also just got some really bad economic news from New York City

Just in case you thought the ISM number was a flukey ‘transitory’ one-off, the New York City ISM just plunged, with the outlook collapsing to its lowest since Feb 2009.

And ahead of Friday’s payroll print, NYC ISM’s employment index plunged to 52.5 from 69.0.

At one time, New York City was on the leading edge of “the economic recovery”, but now things have completely reversed. Economic conditions are rapidly deteriorating, and property values in the city are absolutely plunging

The Manhattan real estate market stumbled in the third quarter of 2019, new reports show, as prices plunged and fewer buyers were willing to purchase higher-priced properties in the wake of two recent tax increases.

The median sales price for properties fell 17 percent from the same quarter last year, to $999,950, according to new data from CORE. The average sales price dropped 12 percent, to $1.64 million.

Wall Street is starting to figure out that these horrible economic numbers are not going away, and investors are starting to get very nervous.

Many of them are still having a hard time believing that the bull market is completely dead, but at this point it definitely is not going to take much to set off an epic rush for the exits.

Whether it happens this month or not, everyone knows how this ridiculous stock market bubble will end.

Throughout U.S. history, whenever stock valuations have been stretched to such an extreme, a stock market crash has always followed.

This time around, it isn’t just an economic crisis that we are facing, and the drama in Washington is going to have a major impact on stock prices in the months ahead.

About the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time. Of course the most important thing that we can share with people is the gospel of Jesus Christ, and if you would like to learn more about how you can become a Christian I would encourage you to read this article.

A U.S. Economic Slowdown Has Been Confirmed, And We Are Being Warned That “More Damage” Is Ahead

We just witnessed the worst month for U.S. manufacturers in more than 10 years, and nobody seems optimistic that things are going to get much better any time soon. In fact, one expert is warning that “more damage” is coming if the trade war is not resolved, and unfortunately it does not appear that a resolution will be possible for the foreseeable future. As I have been detailing for months, the entire global economy has been steadily slowing down, but some shocking new numbers that we just got indicate that our economic problems are really starting to accelerate. So hold on to your hats, because it looks like things are about to get really crazy. According to CNBC, September was the worst month for U.S. factories in more than a decade

The U.S. manufacturing purchasing managers’ index from the Institute for Supply Management came in at 47.8% in September, the lowest since June 2009, marking the second consecutive month of contraction. Any figure below 50% signals a contraction.

The new export orders index was only 41%, the lowest level since March 2009, down from the August reading of 43.3%, ISM data showed.

Those numbers are absolutely abysmal, and they were far worse than analysts were expecting.

Since December 2009, I have published more than 2,000 articles on The Economic Collapse Blog, and in all that time we have never seen manufacturing numbers this bad.

According to Peter Boockvar, the chief investment officer at Bleakley Advisory Group, we have “now tariffed our way into a manufacturing recession in the U.S. and globally”. So those that have been waiting for a “manufacturing recession” to arrive can now stop waiting. It is here, and it is going to be very painful.

All over America factories are starting to close down at an alarming pace. This week, Louisiana Governor John Bel Edwards blamed the “sudden shutdown” of a steel plant in his state on the ongoing trade war

In Louisiana, meanwhile, Gov. John Bel Edwards on Tuesday blamed the sudden shutdown of a steel plant on tariffs. “While Bayou Steel has not given any specific reason for the closure, we know that this company, which uses recycled scrap metal that is largely imported, is particularly vulnerable to tariffs,” he said.

The closure of LaPlace, Louisiana-based of Bayou Steel will cost 376 employees their jobs.

All over the globe, manufacturing numbers are plunging at an alarming pace thanks to the trade war. For a long time I warned my readers that the level of economic pain that this trade war would inflict upon all of us would steadily rise as long as this trade war persisted, and now the experts being quoted by the mainstream media are saying the exact same thing. Here is just one example

“The manufacturing side is telling us something. It’s a combination of global growth and we’ve got a trade war that’s been going on for a year and a half,” said Christian Fromhertz, CEO of The Tribeca Trade Group. “That’s been freezing things up. The longer this trade war keeps going, the more damage it does.

Of course it isn’t just the U.S. that is being hit extremely hard.

Overall, we haven’t seen a slowdown in global trade like this since the last recession, and at this point container shipping rates are down a whopping 34 percent since the beginning of 2019…

Container shipping rates continue to move lower into the fourth quarter of 2019, according to FreightWaves. The drop in price comes as a result of the most recent round of tariffs discouraging U.S. importers from front loading orders. As a result, ocean carriers are looking to cut even more shipping capacity in hopes of meeting tepid demand into the back end of the year.

Spot rates on the Freightos Baltic Daily Index for China-North America West Coast were down 8% from last week, falling to $1,327 per forty-foot equivalent unit. Container rates are down 34% since the beginning of the year, despite the industry now being in peak season.

For months, I have been sharing numbers that indicate that the entire global economy is heading into a recession. But now the numbers are absolutely screaming that major trouble is imminent.

Winter is coming, and it will not be pleasant.

After the horrifying U.S. manufacturing numbers were released on Tuesday, U.S. stock prices immediately began falling, and the Dow ended the day down more than 340 points

The Dow Jones Industrial Average closed 343.79 points lower, or 1.3% at 26,573.04 after rallying more than 100 points earlier in the day. The S&P 500 slid 1.2% close at 2,940.25. The Nasdaq Composite was down 1.1% at 7,908.68.

Tuesday marked the worst one-day performance for the Dow and S&P 500 since Aug. 23.

Meanwhile, as is usually the case when economic doom erupts, the price of gold is soaring once again

Gloom for the economy is a boom for safe havens. A 10-year-low in a reading of U.S. manufacturing activity sent investors flocking back to the safety of gold on Tuesday, just after they let the yellow metal flounder to two-month lows.

U.S. gold futures for December delivery settled up $16.10, or 1%, at $1,489 per ounce on the Comex division of the New York Mercantile Exchange.

The threat of impeachment looms over Washington, and it could potentially unleash political chaos like we haven’t seen in the United States in decades.

And at the same time, the global economy is deteriorating to a degree that we have not seen since the last recession, and many believe that what is coming will be even worse than what we experienced a decade ago.

Dark storm clouds have gathered over America, and we stand on the precipice of one of the most critical moments in the history of our nation.

Unfortunately, most Americans are still dead asleep, and many of them have absolutely no idea what is about to happen.

About the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time. Of course the most important thing that we can share with people is the gospel of Jesus Christ, and if you would like to learn more about how you can become a Christian I would encourage you to read this article.

If Donald Trump Is Impeached, You Should Expect The Mother Of All Stock Market Crashes To Happen

News that an impeachment inquiry is being initiated instantly sent stock prices tumbling on Tuesday, but that small jolt is nothing compared to what we will experience if Donald Trump is actually impeached. Over the past couple of years we have seen a tremendous boom in stock prices, and one of the big reasons for that boom is the fact that the folks on Wall Street know that Trump is always going to be looking out for their best interests. Trump understands that his chances of winning again in 2020 will be greatly enhanced if stock prices are rising and most Americans believe that we have a “booming economy”, and so he wants to do everything in his power to try to make those things happen. That means that Trump’s short-term interests are perfectly aligned with Wall Street’s short-term interests, but things will shift dramatically if someone like Elizabeth Warren or Bernie Sanders ends up in the White House. Wall Street knows that they have a friend in Donald Trump, and losing that friend would potentially be absolutely devastating.

Needless to say, a lot of investors were unnerved on Tuesday when House Speaker Nancy Pelosi announced that a formal impeachment inquiry is being initiated. The following is an excerpt from Pelosi’s official remarks…

For the past several months, we have been investigating in our Committees and litigating in the courts, so the House can gather ‘all the relevant facts and consider whether to exercise its full Article I powers, including a constitutional power of the utmost gravity — approval of articles of impeachment.’

And this week, the President has admitted to asking the President of Ukraine to take actions which would benefit him politically. The action of – the actions of the Trump Presidency revealed the dishonorable fact of the President’s betrayal of his oath of office, betrayal of our national security, and betrayal of the integrity of our elections.

Therefore, today, I am announcing the House of Representatives is moving forward with an official impeachment inquiry. I am directing our six Committees to proceed with their investigations under that umbrella of impeachment inquiry.

The President must be held accountable. No one is above the law.

In the aftermath of that announcement, liberal celebrities all across America erupted in celebration.

But can Nancy Pelosi unilaterally declare the commencement of a formal impeachment inquiry without any sort of a vote? According to Representative Doug Collins, she actually does not have that power…

In reaction to the Speaker’s announcement, Rep. Doug Collins (R-Ga.) tweeted, “Speaker Pelosi’s decree changes absolutely nothing. As I have been telling Chairman Nadler for weeks, merely claiming the House is conducting an impeachment inquiry doesn’t make it so. Until the full House votes to authorize an inquiry, nobody is conducting a formal inquiry.”

In any event, the Democrats are going to push ahead with their investigations, and they seem determined to dig up anything that they possibly can.

In response to Pelosi’s announcement, the White House issued a statement which accused congressional Democrats of being “in dereliction of their Constitutional duty”

‘In a far departure from all of the work and results of this President, House Democrats have destroyed any chances of legislative progress for the people of this country by continuing to focus all their energy on partisan political attacks. Their attacks on the President and his agenda are not only partisan and pathetic, they are in dereliction of their Constitutional duty,’ said White House press secretary Stephanie Grisham in a statement.

We shall see how everything plays out over the next few months, but at this point it seems fairly certain that we will see an impeachment vote on the floor of the House, and it also seems fairly certain that the vote will be split largely along party lines.

Because in this day and age the truth really doesn’t matter. Even if there isn’t any evidence against Trump at all, most Democrats will vote to impeach because that is what they are expected to do. And even if Trump is 100 percent guilty most Republicans will vote against impeachment because they would be afraid of being voted out of office by angry voters back home.

So in the end it will probably come down to what the Senate decides to do, and right now the Republicans are holding 53 seats.

Unfortunately for Trump, some of those 53 seats are held by very “moderate” Republicans that are not fans of Trump at all.

Sadly, the fate of the Trump presidency is likely to end up in the hands of a small group of deeply corrupt politicians that I wouldn’t trust to properly mop the floors in my local Dairy Queen.

With that in mind, I think that Trump fans definitely have reason for some pessimism.

Democrats are licking their chops at the prospect of impeaching Trump and then getting either Joe Biden or Elizabeth Warren into the White House following the next election.

Joe Biden would try to get along with Wall Street, but a Warren administration would be an absolute disaster for investors and right now she is surging in the polls.

Elizabeth Warren originally made a name for herself by attacking Wall Street. Virtually all of her economic proposals would be bad news for the top 1 percent, and the fact that she is doing so well right now is just one of the factors that are currently unsettling the markets

For one, this time around it appears Democrats in the House have momentum toward beginning impeachment proceedings. Second, a formerly robust economic backdrop has given way to jitters about global growth and fears that the U.S. economy is nearing the end of a lengthy expansion. Less confident investors could be more jittery in the face of political headlines than was previously the case.

Also, impeachment proceedings could take center stage in the run-up to the 2020 presidential election, potentially damaging Trump’s re-election bid. Fears of a less business-friendly Democratic administration — amplified by the recent strength of Sen. Elizabeth Warren, who has moved ahead of Biden in some polls — could also be part of the mix, analysts said.

Of course the short-term health of Wall Street is not what we should really be concerned about.

At this moment, the entire global economy is plunging into a substantial downturn, and whoever wins in 2020 is going to have to face that reality.

And beyond that, we are facing long-term crisis after long-term crisis that none of our politicians really want to deal with, and in the end we are going to pay a great price for our short-term thinking.

But for the foreseeable future, the mainstream media is going to be obsessed with the political drama being played out in Washington.

And I know that most Republicans don’t want to hear this, but there is a very real chance that Donald Trump could be impeached by the House.

Then it will all come down to the Senate, and Trump’s fate will be in the hands of moderate Republicans such as Susan Collins, Lisa Murkowski, Marco Rubio and Mitt Romney.

About the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time. Of course the most important thing that we can share with people is the gospel of Jesus Christ, and if you would like to learn more about how you can become a Christian I would encourage you to read this article.

The Latest Numbers Tell Us That The Global Economic Slowdown Is Accelerating Dramatically

Economists are already predicting “the world’s lowest growth in a decade”, but it is beginning to look like what we will be facing will be much worse than that. In recent days, numbers have been coming in from all over the planet that are absolutely abysmal. The “global economic slowdown” is rapidly transitioning into a new global economic crisis, and central banks seem powerless to stop what is happening. They have already pushed interest rates to the floor (actually below the floor in many cases), and over the past decade they have absolutely flooded the global economy with new money. But despite all of this unprecedented intervention, economic conditions are deteriorating at a pace that is breathtaking.

Let’s start by taking a look at what is happening in India. According to CNN, vehicle sales in India fell a whopping 31 percent in July…

Just two years ago, India’s huge car market was booming and global players were rushing to invest. Now it’s been slammed into reverse.

Sales of passenger vehicles plunged 31% in July, according to figures released by the Society of Indian Automobile Manufacturers (SIAM) on Tuesday. It’s the ninth straight month of declines and the sharpest one-month drop in more than 18 years, SIAM Director General Vishnu Mathur told CNN Business.

Those are numbers you would expect to see if we were in the middle of a full-blown economic depression, and it is being projected that this downturn “could result in a million people being laid off”

The slump has prompted companies to slash over 330,000 jobs through the closing of car dealerships and cutbacks at component manufacturers, Mathur said, citing data from industry associations that govern those two sectors.

The Automotive Component Manufacturers Association of India warned in a statement last month that its “crisis-like situation” could result in a million people being laid off.

A million jobs is very serious.

And we are talking about just one industry in one country.

How many jobs will ultimately be lost all over the world in the months ahead?

Over in China, the auto industry is also deeply struggling

China’s Geely (GELYF) revealed this week that its net profit probably plunged by 40% in the first half of the year as the world’s second largest economy slowed. In June alone, its car sales fell 29%.

That isn’t supposed to happen in China.

For decades, China has been one of the primary engines of global economic growth, but now things have changed dramatically.

Perhaps you can blame the trade war for what is happening in China, but the auto industry is also in big trouble in Europe. In fact, some of the biggest automakers in the world are closing European factories and ruthlessly slashing jobs

Ford is cutting 12,000 jobs and closing six plants in Europe, including an engine factory in the United Kingdom. Jaguar Land Rover, which is owned by India’s Tata Motors (TTM), is slashing 4,500 jobs. Honda is also closing a plant in the United Kingdom.

If those companies expected the European economy to bounce back in the foreseeable future, they would not be making such moves.

But just like you and I, they can see what is happening to Europe’s economy, and on Monday we just received some more deeply troubling news. The following comes from Zero Hedge

Weakness in euro-area manufacturing hit a climax this morning as German private sector activity plunged to a seven-year low. The Germany Manufacturing PMI slumped in September, dropping to 41.4, down from 44.7 in August, printing below the lowest sellside estimate (consensus of 44.4); worse, the German manufacturing recession is now spreading to the services sector, where the formerly resilient services PMI also slumped from 54.8 to 52.5, also missing the lowest analyst estimate, and collectively, resulting in the first composite PMI print below 50, or 49.1 to be precise, since April 2013. The rate of decline was one of the sharpest in seven years.

It appears that the German economy has already entered recession territory, and these new numbers are not causing anyone to be optimistic.

In fact, “abysmal” is hardly strong enough to describe these absolutely horrible figures

  • Flash Germany PMI Composite Output Index (1) at 49.1 (Aug: 51.7). 83-month low.
  • Flash Germany Services PMI Activity Index(2) at 52.5 (Aug: 54.8). 9-month low.
  • Flash Germany Manufacturing PMI(3) at 41.4 (Aug: 43.5). 123-month low.
  • Flash Germany Manufacturing Output Index(4) at 42.7 (Aug: 45.8). 86-month low.

Of course the U.S. economy has been slowing down for quite some time now, and if you doubt this, I encourage you to read this list of 28 alarming facts about our economy that I posted earlier this month.

We haven’t seen economic conditions like this in the United States since the depths of the Great Recession, and many believe that what is coming will be far worse than the last time around.

And we may be deep into the coming crisis far sooner than many were expecting. In fact, David Rosenberg of Gluskin Sheff is adamant that there is “a recession coming in the next 12 months”

David Rosenberg, the Gluskin Sheff chief economist and strategist, is warning that a recession is coming. Rosenberg says economic growth in the United States will turn negative sooner than most investors anticipate and the Federal Reserve is powerless.

Even if the central bank lowers interest rates to zero, a recession will still grip the U.S. within 12 months, Rosenberg predicts. “There’s a recession coming in the next 12 months,” he stated with fact last Thursday on CNBC’s “Futures Now. The Fed just lowered its benchmark interest rate last Wednesday by a quarter-point and Fed Chairman Jerome Powell signaled rates would only be cut again if there’s new evidence the economy is softening.

If things really start to deteriorate in the months ahead, we could be in the midst of a horrible economic downturn by the time the U.S. presidential election rolls around.

Let us hope that is not the case, but right now things certainly do not look good for the U.S. economy or for the global economy as a whole.

About the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time. Of course the most important thing that we can share with people is the gospel of Jesus Christ, and if you would like to learn more about how you can become a Christian I would encourage you to read this article.

Goldman Sachs Has Just Issued An Ominous Warning About Stock Market Chaos In October

Are we about to see U.S. financial markets go crazy? That is what Goldman Sachs seems to think, and it certainly wouldn’t be the first time that great financial chaos has been unleashed during the month of October. When the stock market crashed in October 1929, it started the worst economic depression that we have ever witnessed. In October 1987, the largest single day percentage decline in U.S. stock market history rocked the entire planet. And the nightmarish events of October 2008 set the stage for a “Great Recession” that we still haven’t fully recovered from. So could it be possible that something similar may happen in October 2019? According to CNBC, Goldman Sachs is warning that the stock market could soon “go crazy again”…

For investors taking a breather from the chaos in August, buckle up as the market is about to go crazy again, Goldman Sachs warned.

Wall Street is now inches away from reclaiming its record highs, but a rockier ride could be around the corner as stock volatility has been 25% higher in October on average since 1928, according to Goldman. Big price swings have been seen in each major stock benchmark and sector in October over the past 30 years, with technology and health care being the most volatile groups, Goldman said.

Goldman derivatives strategist John Marshall is the man behind this new warning, and he believes that there are some fundamental reasons why the month of October is often so volatile…

“We believe high October volatility is more than just a coincidence,” John Marshall, equity derivatives strategist at Goldman, said in a note Friday. “We believe it is a critical period for many investors and companies that manage performance to calendar year-end.”

And even though October hasn’t arrived yet, we are already starting to see some things that we haven’t witnessed since the last financial crisis.

For example, the Federal Reserve had not intervened in the repo market since 2008, but this week the liquidity crunch was so bad that the Fed felt forced to conduct emergency overnight repurchase agreement operations on Tuesday, Wednesday, Thursday and Friday.

And then on Friday the Fed announced that it will continue to conduct emergency interventions “on a daily basis for the next three weeks”

The New York Federal Reserve Bank said Friday it will inject billions into the US financial plumbing on a daily basis for the next three weeks in an effort to prevent a spike in short-term interest rates.

The Fed will offer up to $75 billion a day in repurchase agreements — exchanging secure assets for cash for very short periods — through October 10, it said in a statement.

In addition, it will offer three 14-day “repo” operations of at least $30 billion each.

In essence, the “plumbing” of our financial system has gotten all jammed up, and calling out Roto-Rooter is simply not going to get the job done.

Of course Fed officials are trying to assure us that this is no big deal and that they have everything under control.

But if all this is no big deal, why haven’t they had to conduct such emergency interventions for the last 11 years?

And this comes at a time when the deterioration of the U.S. economy appears to be accelerating. In fact, on Friday St. Louis Fed President James Bullard publicly admitted that the U.S. manufacturing industry appears to already be in a recession

The US manufacturing sector “already appears in recession” and overall economic growth is expected to slow “in the near horizon,” St. Louis Federal Reserve Bank president James Bullard said on Friday, explaining why he dissented at a recent Fed meeting and wanted a deeper, half-percentage-point rate cut.

That is a stunning admission, because normally Fed officials try very hard to maintain the narrative that everything is wonderful because they are doing such a great job of manipulating the economy.

The American people as a whole are becoming increasingly pessimistic about the economy as well, and Gallup just released some very alarming numbers

Americans’ confidence in the economy has become less rosy this month as Gallup’s Economic Confidence Index fell to +17 from August’s +24 reading, marking the lowest level since the government shutdown ended in January.

At the same time, the public is evenly divided over the likelihood of a recession in the next year. The current expectation of a recession is nine points higher than it was in October 2007, just two months before the Great Recession began but slightly below a February 2001 reading, one month before that eight-month-long recession.

Every economic indicator that we have is telling us that big trouble is heading our way, but most Americans are partying instead of preparing.

U.S. financial markets have never been more primed for a crash than they are at this moment, and so many of the exact same patterns that we witnessed just prior to the last recession are happening again right now.

Over the past few months, my wife and I have felt a sense of urgency unlike anything that we have ever felt before. You may have noticed a difference in our tone and in the types of stories that we have been sharing. Everything that we have been doing has been leading up to this. The time of “the perfect storm” is here, and most Americans won’t understand what is happening.

The storm clouds are looming and disaster could strike at any time. This is one of the most critical times in the history of our nation, and most Americans are completely unprepared for what is going to happen next.

About the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Dow 27,000? I Think That We Have FINALLY Reached Peak Stock Market Absurdity

Even though everything else seems to be going wrong, the stock market just continues to soar to new record highs. In fact, the Dow Jones Industrial Average closed above 27,000 for the first time ever on Thursday. Investors continue to relentlessly believe that bright days are ahead even though we are on the brink of a war with Iran, we are in the middle of a trade war with China, California has been hit by more than 10,000 earthquakes over the past week, and all of the economic numbers are screaming that a recession is dead ahead. There has certainly been a lot of craziness on Wall Street in recent years, but the truth is that stock prices have never been as absurd as they are right now. It is inevitable that a very painful reality check is coming, but for the moment investors are celebrating another historic landmark

The 30-stock average broke above 27,000 for the first time in its history, rising 227.88 points, or 0.9% to 27,088.08. The Dow first closed above 26,000 in January of 2018, so it’s been a little more than a year-and-half trek between 1,000 point moves. The gains were largely driven by expectations the Fed will cut rates, insulating the market from a slowing economy and a trade battle with China.

But if things are so good, then why is the Federal Reserve talking about cutting interest rates?

Sadly, the truth is that the Federal Reserve is considering rate cuts because the economic numbers have been disastrous lately. Global trade has fallen to the lowest levels that we have seen since the last recession, and manufacturing activity just continues to plummet. Here in the United States, manufacturing activity just hit the “lowest level in nearly three years”

US manufacturing activity last month fell to its lowest level in nearly three years — well below the pace when President Donald Trump took office — another warning sign for the world’s largest economy as it marks the longest expansion on record.

The manufacturing slowdown was driven by weakening demand for US-made goods, with factories reluctant to produce stock they may not be able to sell, according to the Institute for Supply Management’s monthly survey.

Meanwhile, JPMorgan’s Global Manufacturing PMI just plunged to the lowest level in nearly seven years

It’s a bloodbath. No matter where you look, global manufacturing surveys are signaling growth is over (and in most cases, outright contraction is upon us).

JPMorgan’s Global Manufacturing PMI fell to its lowest level for over six-and-a-half years and posted back-to-back sub-50.0 readings for the first time since the second half of 2012.

But in the bizarro environment that we find ourselves in, investors see those absolutely horrible numbers as evidence that the Fed will soon cut interest rates, and that means it must be a good time to buy stocks.

Every bad economic number just seems to fuel the feeding frenzy, and there certainly have been a lot of bad numbers in recent days.

For example, we just learned that small business employment has been falling at a rate that we haven’t seen “in over 9 years”

The small business sector leads the cycle and employment here has plunged 61k in the past two months. Haven’t seen this in over 9 years; same decline we saw in Feb-March of 2008 when the consensus was busy calling for a soft landing.

That is terrible news, but for many investors that is a prime buying signal.

Everywhere we look we see signs of economic trouble. The auto industry is mired in the worst slump in a decade, home sales have slowed dramatically all over the nation, and we are pace to absolutely shatter the record for most retail stores closed in a single year. In fact, on Thursday we learned that another major retailer is completely liquidating

Fashion accessory retailer Charming Charlie will close all its stores after going bankrupt for the second time in less than two years. More than 3,000 full- and part-time employees could lose their jobs.

Charming Charlie Holdings Inc. filed for Chapter 11 protection in Delaware with plans for going-out-of-business sales at about 261 stores, according to court documents. The chain expects the liquidation to take about two months.

But in an environment where “bad news is good news”, that is just another indication that this is a perfect time for investors to gobble up stocks like there is no tomorrow.

For months, I have been documenting the numbers that indicate that a new economic downturn has already begun. And one of the sectors where we can see this most clearly is in the trucking industry

Freight rates have dipped year-over-year for six months straight while loads on the spot market, in which retailers and manufacturers buy trucking capacity as they need it, rather than through a contract, fell by 50.3% in June year-over-year. Truckers have also continued to warn of a “bloodbath” as they slash their profit expectations and companies file for bankruptcy.

Yet no matter how bad things get for the real economy, the euphoria on Wall Street never seems to end.

Investors just continue to relentlessly pour more money into stocks when everything is telling them to stop.

In fact, even the bond market is flashing warning sign after warning sign. The following example comes from CNN

Something happened in the bond market last week that has occurred before five of the past six major market meltdowns.

The yield on the benchmark 30-year US Treasury bond — the lesser-known but still important fixed income cousin to the 10-year — briefly dipped below 2.5%. In other words, the 30-year was yielding less than the Federal Reserve’s short-term federal funds rate.

But until the next market meltdown actually happens, the irrational optimists on Wall Street are just going to continue to mock those of us that are warning that the party cannot continue indefinitely. Sadly, when the party on Wall Street finally ends it is likely to happen very suddenly, and the pain will be off the charts.

Let me say this one more time. You only make money in the stock market if you get out in time. If you are still holding on to your stocks after the big crash happens, it is not going to matter that the Dow once hit 27,000, because you will never see any of the money that you could have made if you had gotten out at the top of the market.

About the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Trump Just Poked The Dragon In The Eye, And U.S.-China Relations Just Took An Ominous Turn For The Worse

After what President Trump just did, the odds of the U.S. and China being able to reach a trade agreement this year officially just went from slim to none. For China, there is no issue more sensitive than the status of Taiwan. For the Chinese, it is unthinkable for anyone to even suggest that Taiwan is not a part of China, and the Chinese are prepared to defend their “one China” policy to the death if necessary. On the other hand, most Americans are entirely clueless about Taiwan. In fact, if you gave them a blank map of the world the vast majority of Americans wouldn’t even be able to find Taiwan thanks to our exceedingly poor system of public education. So for most Americans, a news story about how President Trump plans to sell 2 billion dollars worth of arms to Taiwan is completely and utterly meaningless. But for the Chinese, such news is a deep national insult

The United States is pursuing the sale of more than $2 billion worth of tanks and weapons to Taiwan, four people familiar with the negotiations said, in a move likely to anger China as a trade war between the world’s two biggest economies escalates.

An informal notification of the proposed sale has been sent to the U.S. Congress, the four sources said on condition of anonymity because they were not authorized to speak about the possible deal.

This arms sale barely made a blip in the U.S. news cycle, but over in China they are officially freaking out about this. According to one report, this deal would send “over 100 tanks and almost 2,000 missiles” to Taiwan…

The US, which is the main weapons dealer to Taiwan, would send over 100 tanks and almost 2,000 missiles to the island. There was outrage in China, who said they were seriously concerned after Taiwan’s defence ministry confirmed the sale. The move is believed to further heighten tensions between Beijing and Washington.

It comes days after Chinese defence minister Wei Fenghe said: “If anyone dares to split Taiwan from China, the Chinese military has no choice but to fight at all costs.”

You can do quite a bit of damage with 2,000 missiles.

Most Americans may not realize this, but the truth is that U.S.-China relations just took a really ominous turn for the worse.

And in addition to announcing this arms sale to Taiwan, President Trump also just threatened China with even more tariffs

DONALD Trump threatened to hit China with tariffs on “at least” another $300bn worth of goods today – as a Beijing propaganda campaign painted the US as evil bullies.

Tensions between the world’s two largest economies have soared sharply since talks aimed at ending a festering trade war broke down in early May.

But trust me, the announcement of the arms sale to Taiwan was far, far more insulting to China than the tariff threat was.

On the Chinese side, they have decided to hit the U.S. right in the farm belt by “putting purchases of U.S. soybeans on hold”

China is reportedly putting purchases of U.S. soybeans on hold amid the growing trade war with the U.S., according to a report from Bloomberg News. As the world’s largest soybean buyer, China’s move could ramp up the economic pressure on American farmers.

This has already been the worst year for U.S. farmers in decades, and this move by the Chinese is going to make things even worse. For much more on this, please see an article that I posted earlier today entitled “U.S. Farms Are Facing Their Worst Crisis In A Generation – And Now Here Comes Another Monster Storm”.

Also, anti-American rhetoric in China has now reached a fever pitch. According to CNN, the Chinese just issued an official alert warning Chinese travelers of “shooting, robbery and theft” in major U.S. cities…

On Tuesday, China’s Culture and Tourism Ministry warned its citizens of the risks of traveling to the US in an alert, citing frequent recent cases of “shooting, robbery and theft.”

On the same day, the country’s Foreign Ministry — along with China’s embassy and consulates in the US — issued a security alert for Chinese citizens, alleging “repeated harassment” of Chinese nationals in the US by local law enforcement officials.

Of course the Chinese are correct when they warn about the violence in our cities. For example, more than 50 people were shot in the city of Chicago last weekend alone.

In addition to the travel warnings, Chinese state media is doing all that it can to put the U.S. in a bad light. In fact, one major Chinese paper just called the United States the “enemy of the world”

The new travel advice did not come in isolation.

China’s ruling Communist Party has launched a trade war propaganda campaign, with recent efforts — delivered via state media — focusing on US “trade bullying” and “hegemony.” In one noteworthy article, published Tuesday in party mouthpiece the People’s Daily, the US was labeled the “enemy of the world.”

Does it sound to you like the Chinese are ready to surrender and head back to the negotiating table?

No, the truth is that they are just getting angrier with every week that goes by. Most Americans don’t even know that we fought against the Chinese during the latter stages of the Korean War, but right now over in China those old battles against “the evil American invaders” are being publicly celebrated

President Xi Jinping’s state media has even begun to refer to a very bloody battle between America and Chinese forces during the Korean War.

The 1952 battle of Triangle Hill – or Shangganling in Chinese – has been glorified in China for decades as a turning point in the war.

School children are told how the sacrifice of Chinese soldiers eventually led to the “defeat of the evil American invaders”.

At this point, most Americans may be vaguely aware that some sort of a trade war is going on, but over in China they are taking this deadly seriously. And without a doubt, the stage is being set for a full-fledged global showdown between the two superpowers.

This is not a game, and if things go badly we could potentially be facing apocalyptic consequences.

So hopefully Trump knows what he is doing, because right now things appear to be starting to spiral out of control very rapidly.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Economic Chaos Erupts! – Global Manufacturing Plunges, The Trade War Expands And The Nasdaq Enters Correction Territory

The global economic slowdown is really starting to accelerate. Just within the past few days, we have gotten more really awful global manufacturing numbers, the trade war has expanded to more nations, and the Nasdaq has officially entered correction territory. We have not witnessed this sort of global economic environment since the Great Recession, and if the economic chaos continues to escalate it won’t take too much to spark a brand new financial crisis. Of course the global financial system is far more vulnerable than it was back in 2008, and so if we stay on the path that we are currently on we could be facing a nightmare scenario very rapidly.

Let’s talk about the manufacturing numbers first. The numbers coming out of Germany are already at a crisis level, and manufacturing is also now contracting in Japan, South Korea and China as well.

Overall, global manufacturing as a whole has now fallen into contraction territory for the first time in seven years

Global manufacturing was the weakest since 2012 last month, a victim of mounting trade tensions and further reason to worry that the world economy is weakening.

With softness in Germany, Japan, the U.K. — as well as the lowest U.S. result in a decade — IHS Markit’s global Purchasing Managers Index fell to 49.8 in May, below the 50 level that divides expansion from contraction.

The reports underscore the growing threat posed by the escalating U.S.-China trade war, and they coincided with a fresh warning from Wall Street about recession risks.

The reason why so many people are freaking out about these numbers is because this is exactly what we would expect to see if we were entering a global recession.

Meanwhile, global financial markets are looking increasingly shaky. On Monday, the Nasdaq fell another 120 points and it has now officially entered correction territory

Stocks ended mostly lower Monday, June’s first day of trading, amid reports that the U.S. government is planning to target a host of big tech companies with antitrust and business practice probes. Shares of Alphabet, Amazon, Facebook and Apple all weighed on the market during Monday’s session.

The Nasdaq dropped 1.6% to enter correction territory, closing more than 10% below its record high set in late April.

The term “correction territory” might not mean a lot to many of you, so let me put what is happening in terms you may understand.

On Monday alone, America’s most prominent tech stocks lost approximately 150 billion dollars in value. It looks like the Trump administration is getting ready to go to war with the big tech companies, and that is really, really bad news for tech investors. The following comes from Breitbart

The Masters of the Universe got hit hard by investors on Monday. Like $150 billion hard.

Shares of the top tech giants fell sharply on Monday after reports that U.S. antitrust regulators had divided up oversight of the sector, with the Department of Justice assuming responsibility for Alphabet and Apple and the Federal Trade Commission taking on Facebook and Amazon. This triggered fears that the government could mount challenges to the business models of the companies.

Shares of Alphabet dived 6.1 percent on Monday after the Wall Street Journal reported that the Justice Department is in the early stage of preparing an antitrust probe of the company. Reuters reported that the Department of Justice is also looking into Apple’s business for possible antitrust violations.

Speaking of war, our trade conflict with China continues to escalate. The mainstream media hasn’t been talking much about it, but apparently the Chinese have decided to put purchases of U.S. soybeans “on hold” until a trade agreement is reached…

China, the world’s largest soybean buyer, has put purchases of American supplies on hold after the trade war between Washington and Beijing escalated, according to people familiar with the matter.

State-grain buyers haven’t received any further orders to continue with the so-called goodwill buying and don’t expect that to happen given the lack of agreement in trade negotiations, said the people, who asked not to be named because the information is private.

U.S. soybean farmers have been sitting on unprecedented amounts of soybeans in hopes that an end to the trade war would raise prices.

But instead, demand for U.S. soybeans is going to go through the floor, and this could potentially force thousands of soybean farmers into bankruptcy.

And in addition to our trade war with China, the Trump administration has apparently decided that now is a good time to start a trade war with Mexico

From produce to cars, a wide variety of Mexican goods could become more expensive if Trump follows through on his threat to hit Mexican imports with tariffs that soon could climb to 25%. Trump wants to pressure Mexico into doing more to halt the flow of Central American migrants to the U.S. via the Mexican border.

The tariffs, set to begin June 10, would gradually climb to 25% on Oct. 1 if Mexico doesn’t take steps “to dramatically reduce or eliminate” the number of migrants, Trump said Thursday. Such a strategy would hurt American shoppers, the economy and stocks, experts say, just as U.S. growth is slowing and the threat of more tariffs on Chinese imports looms larger.

At least in this case the U.S. and Mexico are still talking, and so perhaps some kind of resolution can be reached.

On top of everything else, the Trump administration has also just decided to add India to the trade war as well

Mr. Trump on Friday said India would be removed from the U.S.’s privileged-trading program called the Generalized System of Preferences on Wednesday. Under the decadeslong program meant for some developing economies, the U.S. had allowed India to avoid tariffs on certain exports to the U.S. in the interest of promoting tighter trade ties and development.

India, the U.S.’s ninth-largest trading partner, is a top beneficiary of the GSP program. Mr. Trump’s move will add tariffs of as much as 7% on Indian exports of goods like chemicals, auto parts and tableware to the U.S., which in 2018 accounted for more than 11%, or $6.3 billion, of India’s total exports of goods valued at $54.4 billion, according to the Congressional Research Service, a research agency for the U.S. Congress.

A global trade war is going to be incredibly painful for everyone, and this is all happening at a time when the global economy was already starting to slow down substantially.

Here in the United States, a lot of businesses are really starting to notice a big decline in economic activity. Here is just one example that was published on Zero Hedge earlier today…

Down here, in Texas, I am seeing a big drop in economic activity over the last 6 months. Our healthcare businesses’ volume over this period is at 629, down from 770, year-on-year, almost a 20% decline, and the worst six month decline in our 15 year history. We have been pulling out all of the stops for business development, cutting overhead, and running all the QC traps to determine if it is something within our business, within our local market, within our industry, or having to do with the economy in general.

In this period, we have seen seven competitors go out of business in our city. We have recently confirmed similar experiences with colleagues in Kentucky, Colorado, and elsewhere in Texas. One of them asked me, “If this is not temporary, what would the strategy be?” My response was, “Hunker in the bunker and wait for everyone else to die.”

This is what we have all been preparing for, and things are going to get progressively tougher in the months ahead.

Unfortunately, most Americans are completely and totally clueless about what is ahead. Today, 59 percent of all Americans are living paycheck to paycheck, and the truth is that the vast majority of us are entirely unprepared to go through another recession.

And of course many believe that what we are facing is going to be much worse than just a “recession”. A perfect storm is rapidly coming together, and the chaos that we have seen so far is nothing compared to what is rapidly approaching.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

All Of The Economic Momentum Is Moving In Just One Direction Now

Earlier today, I was greeted by this jarring headline when I visited the Drudge Report: “BONDS FLASH RECESSION WARNING”. These days, it seems like the “R word” is being thrown around constantly, but at this time last year everyone was celebrating how well the economy was doing. Unfortunately, we have witnessed a dramatic shift in recent months, and we just got some more really bad economic numbers. Thanks to those bad numbers and an increasing amount of anxiety about the trade war, the Dow Jones Industrial Average fell another 237 points on Monday. That means that we are on pace to potentially see the Dow fall for a sixth week in a row, and that is something that hasn’t happened since the last recession.

But right now investors are far more spooked about what is going on in the bond market. According to Mish Shedlock, we haven’t seen this many yield curve inversions “since the start of the Great Recession”…

On Friday, US Treasury yields plunged at the mid to long end of the curve providing the most inversions since the start of the Great Recession. This is the biggest recession warning since 2007.

In so many ways, what we are witnessing at this moment is very reminiscent of the conditions that prevailed just prior to the last financial crisis.

Back then, the economic numbers were definitely starting to slide, but most Americans didn’t think that we were heading toward big trouble. But those that understood what was happening were sounding the alarm, and the same thing is happening today. For example, the following comes from a CNBC article entitled “Morgan Stanley says economy is on ‘recession watch’ as bond market flashes warning”

“Recent data points suggest US earnings and economic risk is greater than most investors may think,” wrote Michael Wilson, the firm’s chief U.S. equity strategist.

Specifically, the stock strategist highlighted a recent survey from financial data firm IHS Markit that showed manufacturing activity fell to a nine-year low in May. That report also revealed a “notable slowdown” in the U.S. services sector, a key area for an American economy characterized by huge job gains in health care and business services.

In addition to disappointing manufacturing numbers, we also just learned that orders for capital goods were down significantly during the month of April…

The Commerce Department said on Friday orders for non-defense capital goods excluding aircraft, a closely watched proxy for business spending plans, dropped 0.9% last month as demand weakened almost across the board. Data for March was revised down to show these so-called core capital goods orders rising 0.3% instead of increasing 1.0% as previously reported.

Also, we just found out that U.S. home price gains have now fallen for 12 months in a row.

When you add those numbers to all of the other depressing economic numbers that have been rolling in lately, a very clear picture emerges.

The U.S. economy is heading in the wrong direction, and things are steadily getting worse.

A resolution to our trade war with China would be a huge economic boost in the short-term, but that is not likely to happen for the foreseeable future. In fact, on Monday President Trump stated that he is “not ready” to make a deal with China

Bank shares fell broadly amid the lower interest rates. Goldman Sachs dropped 1.8% while Citigroup and J.P. Morgan Chase fell 0.9% and 1.1%, respectively. Morgan Stanley and Wells Fargo also slipped.

The drop in bank shares and rates come after President Donald Trump said on Monday the U.S. was “not ready” to make a deal with China, before adding he expected one in the future. Trump also said tariffs on Chinese imports could go up “substantially.”

And the Chinese are clearly digging in as well. The chief editor of the Global Times, Hu Xijin, has a very close relationship with top Chinese officials, and he just warned that China “is seriously considering restricting rare earth exports” to the United States…

While the official at China’s national planning body did not directly answer whether Beijing would restrict rare earth exports to the United States, Global Times Editor-in-chief Hu Xijin wrote on Twitter: ‘Based on what I know, China is seriously considering restricting rare earth exports to the U.S. China may also take other countermeasures in the future.’

Although the tabloid Global Times is not one of China’s official media, it is widely read and is published by the ruling Communist Party’s People’s Party newspaper.

Just a few days ago I published an entire article about the impact that such a move would have on the U.S. economy, and I won’t reproduce all of that information here.

But the bottom line is this – the U.S. economy would be in a massive amount of trouble if that happened.

A deteriorating relationship with China is part of the scenario that we have been anticipating, and events are definitely starting to accelerate now.

For most Americans, however, there is no reason to be concerned. Most of us simply trust that our leaders in Washington have things under control and that everything will work out just fine somehow.

But if we do plunge into another deep economic crisis, many Americans will be in enormous trouble right away. According to one recent survey, 45 percent of us rate our financial situations as either “fair” or “poor”

Nearly 30% of respondents rate their financial situation as “only fair” and 15% say it’s “poor.” Meanwhile, 25% worry “all” or “most” of the time that their household income won’t be enough to cover their expenses.

Their biggest concerns: Saving enough for retirement and unplanned medical costs, with 54% and 51%, respectively, saying they’re “very” or “moderately” worried about each prospect.

In addition, another recent survey discovered that 59 percent of all Americans are currently living paycheck to paycheck.

Just like last time around, most Americans are living on the edge financially.

And just like last time around, millions of Americans will be completely blind-sided by an economic train wreck that they didn’t see coming.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

U.S. Stocks Have Now Fallen For 5 Weeks In A Row – That Is The Worst Stock Market Streak In Almost 8 Years

We haven’t seen stock prices slide like this in a long time, and if this keeps up we could soon be looking at an avalanche. Our rapidly escalating trade war with China and more bad U.S. economic numbers pushed stocks down once again this week, and at this point the Dow Industrial Average has now fallen for five weeks in a row. We haven’t seen a losing streak this long since June 2011, and it is yet another indication that we have reached a major turning point. Some positive comments about China from President Trump on Friday helped to lift stocks a little, but it wasn’t enough to put stocks into the green for the week. Of course the S&P 500 and the Nasdaq are both working on losing streaks as well. According to CNBC, both of them have now declined for three weeks in a row…

But Friday’s gains were not enough to offset this week’s losses. The Dow dropped 0.7% this week to post its fifth consecutive weekly decline, its longest streak since 2011. The S&P 500 and Nasdaq fell a third straight week of losses, their longest slide since December 2018. The weekly losses come at a time when investors are growing more convinced that the trade war will take longer than expected to conclude and could hurt the economy.

Unfortunately, things are not likely to turn around any time soon. As I discussed yesterday, there is not much optimism that a trade deal with China will happen any time in the foreseeable future, and that is going to continually weigh on the economy.

Meanwhile, we continue to get more numbers that indicate that the U.S. economy is starting to slow down significantly. On Friday, a key survey of U.S. manufacturing activity plunged to the lowest level in more than 9 years

An IHS Markit “flash” survey of U.S. manufacturers fell to a nine-and-a-half-year low of 50.6 this month from 52.6 in April. Manufacturing conditions have been soft for months.

Even more ominous, was the firm’s survey of U.S. service-oriented companies such as banks and retailers. These slipped to a 39-month low of 50.8 from 52.7.

Lately you have heard me talk about a lot of things that haven’t happened in “8 years” or “9 years”. In so many areas, we are seeing numbers that we have not seen since the last recession, and many believe that the worst is yet to come.

And actually things are even worse for the retail industry than they were at any point during the last recession. We are already on pace to absolutely shatter the all-time record for store closings in a single year, and on Friday we learned that yet another retail chain is shutting down all of their stores

In another sign of traditional retailers’ struggles, Topshop plans to close all 11 of its US stores as its parent company seeks to restructure after filing for bankruptcy protection.

Arcadia Group, the London-based owner of fast-fashion chain Topshop Topman, said it was facing “unprecedented” market conditions in the retail sector.

Day after day we just continue to get more numbers that tell us that the U.S. economy is heading in the wrong direction.

And we received more confirmation of that fact when J.P. Morgan economists dramatically slashed their U.S. GDP forecast for the second quarter of this year…

J.P. Morgan economists said they now see much slower second-quarter growth of just 1%, down from their prior forecast of 2.25% and way off the 3.2% reported in the first quarter.

“The April durable goods report was bad, particularly the details relating to capital goods orders and shipments. Coming on the heels of last week’s crummy April retail sales report, it suggests second quarter activity growth is sharply downshifting from the first quarter pace, ” the economists wrote.

Meanwhile, more troubling economic news continues to come in from all over the globe. We just learned that Mexico’s economy is officially shrinking, and the Chinese government was just forced to take over an insolvent bank for the first time ever

China’s financial regulators said on Friday the country’s banking and insurance regulator and the central bank, will take control of the small, troubled inner Mongolia-based Baoshang Bank due to the serious credit risks it poses. The regulator’s control of Baoshang will last for a year starting on Friday, the People’s Bank of China (PBOC) and China Banking and Insurance Regulatory Commission (CBIRC) said on their websites.

The stage is being set for the sort of global economic meltdown that we have been anticipating. Of course if the U.S. and China were able to pull off a miracle and agree to a trade deal, that would be a tremendous boost to both the financial markets and the entire global economy. But the only way that is going to happen is if one side or the other totally caves in. The Chinese government has made a really big deal about the fact that they are not going to move from their current positions, and so the only way that a deal will happen at this point is if Donald Trump decides to wave a white flag and completely surrender to the Chinese.

What do you think the odds are of that happening?

But as the U.S. economy continues to deteriorate, the pressure on Trump to “do something” is going to be immense.

So we shall see what happens. For now global financial markets are slowly sliding downhill, but eventually patience is going to run out and at that point we could see a mad dash for the exits.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

There Is An Increasing Amount Of Buzz That China Could Invoke The Rare Earth “Nuclear Option” In The Trade War

If China wants to cause a massive amount of pain for the U.S. economy in this trade war, they certainly have the firepower to do so. Today, China accounts for more than 80 percent of the world’s rare earth element production, and approximately 80 percent of the rare earth elements that are used by U.S. companies are imported from China. The U.S. does have one facility that mines rare earth elements in California, but everything that is mined there has to be shipped to China for processing. So at this point we do not have the ability to supply our own rare earth element needs, and that gives the Chinese a tremendous amount of leverage.

Without rare earth elements, modern society as we have come to know it would not be able to function.

Today, rare earth elements are used in the production of cell phones, televisions, computers, DVD players, speakers, cameras, electric car motors, jet engines, satellites, lasers, wind turbines and superconductors.

In other words, without rare earth elements we would not be able to produce any of those things. And since the Chinese have such a dominant position in the global marketplace, that gives them an incredible amount of power.

Of course the Chinese understand this very well, and shortly after trade talks with the U.S. completely collapsed Chinese President Xi Jinping made it a point to visit one of the most important rare earth production facilities in China. Needless to say, the purpose of that visit was to send a very clear message to the United States. And once the Trump administration moved to cripple Chinese telecommunications giant Huawei, there was a lot of speculation in the mainstream media that China may consider cutting off rare earth exports to the U.S. in response

The United States last week threatened to cut supplies of US technology needed by Chinese telecom champion Huawei, which Washington suspects is in bed with China’s military.

The US move has fanned speculation that Xi could impose retaliatory measures and in an indication of the importance of rare earths to the US, Washington did not include them in a tariffs increase on Chinese goods this month.

If China made such a move, it would take the trade war to an entirely different level. Some are referring to this as China’s “nuclear option”, and they will not use it lightly.

But if they do decide to go there, it will be absolutely devastating

“China could shut down nearly every automobile, computer, smartphone and aircraft assembly line outside of China if they chose to embargo these materials,” James Kennedy, president of ThREE Consulting, wrote Tuesday in National Defense, a US industry publication.

Just consider the implications of that statement for a moment.

If China wants to do so, they could essentially shut down all auto, phone, computer and aircraft manufacturers in the United States once their existing supplies of rare earth elements run out.

If I was an executive at one of those companies, I would be hoarding rare earth elements like crazy right now.

Unfortunately, the rhetoric on both sides of this trade war just continues to intensify. This week, Chinese President Xi Jinping referred to this trade war as “the new Long March”

“Today, on the new Long March, we must overcome various major risks and challenges from home and abroad,” state news agency Xinhua paraphrased Xi as saying, referring to the 1934-36 trek of Communist Party members fleeing a civil war to a remote rural base, from where they re-grouped and eventually took power in 1949.

“Our country is still in a period of important strategic opportunities for development, but the international situation is increasingly complicated,” he said.

And the Trump administration decided to make China even more upset by sailing two warships through the Taiwan Strait

Just in case the “world tech and trade war I” was not enough to send US-China relations back decades, on Wednesday the US military sent two Navy destroyers through the Taiwan Strait in its latest transit through the sensitive waterway, “angering China” at a time of tense relations between the world’s two biggest economies.

While trade war between the two superpowers is raging, so far at least there have been no shooting incidents, and yet the US seems eager to provide just the right “excuse” for a trade war to become a “kinetic” one, as Taiwan is one of a growing number of flashpoints in the U.S.-China relationship, where in addition to the increasingly bitter trade war, China’s increasingly muscular military posture in the South China Sea has prompted the United States to conducts frequent freedom-of-navigation patrols.

The longer this trade war lasts, the angrier that the Chinese are going to become.

Sadly, most Americans don’t even seem to realize that a trade war is happening, but over in China this is what everyone is talking about right now. In fact, a new song entitled “Trade War” has just gone viral on one of their biggest social media platforms

A song titled “Trade War,” (video below) has gone viral on one the largest Chinese social media platforms, WeChat, generating more than 100,000 views amid a deepening trade war between the US and China. The song begins with a chorus singing “Trade war! Trade war! Not afraid of the outrageous challenge! Not afraid of the outrageous challenge! A trade war is happening over the Pacific Ocean!” reports Bloomberg.

You can listen to the song for yourself on YouTube right here.

If we stay on this path, relations with China are going to continue to deteriorate, and that has ominous implications for our future.

The two largest economies on the entire planet are now locked in a great struggle, and both sides are absolutely determined to emerge victorious.

It may not happen immediately, but at some point the Chinese will be very tempted to cut off all exports of rare earth elements to the United States, and if that happens we will immediately start hearing squeals of panic from many of the largest U.S. corporations.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Stocks And Bonds Are Both Sending The Exact Same Message As Wall Street Braces For A Very Uncertain Future

Slowly but surely, Wall Street is starting to understand that the good times are over. For months, most investors were absolutely convinced that the U.S. and China would be able to work out a trade deal because the alternative would simply be too painful for both sides. But now trade talks are completely dead, and Wall Street is starting to come to grips with the reality that we really are facing a very long trade war. Unless there is a major miracle, this trade war with China is likely to last until the presidential election in 2020, and if Trump wins it could go a lot longer than that. And of course this comes at a time when the U.S. economy is already slowing down dramatically. The economic optimism of the last couple of years is being replaced by a deep sense of gloom, and we are starting to see this reflected in the behavior of the markets.

For example, on Thursday we witnessed “dramatic” moves in the bond market as investors engaged in a rush to safety…

Investors rushed into the safety of bonds Thursday and dumped stocks, as it appeared the trade war could be prolonged and more painful for the world economy than expected.

The moves in the bond market were dramatic, with the 10-year Treasury yield dropping about 8 basis points in its biggest one-day move since April 1. At the same, traders in fed funds futures bet on the Fed making two quarter-point rate cuts by the middle of next year and possibly a third in the second half of 2020.

Meanwhile, stocks continued to fall as well, although some positive remarks from President Trump caused a bump late in the day…

Wall Street is coming to grips with the idea that the US-China trade war will get worse before it gets better.

The Dow dropped 286 points, or 1.1%, on Thursday on fears about the tariff battle slowing global growth and dinging corporate profits. The index recovered somewhat toward the end of the day — at one point it was down nearly 450 points.

Unfortunately, stocks and bonds are both telling us the exact same thing.

According to the head of short U.S. rate strategy at Bank of America Merrill Lynch, U.S. financial markets are indicating that “we’re moving toward a worst case scenario, and that could persist for quite some time”

“The market is obviously telling you that it’s quite worried about some of the incoming data, including the PMIs this morning, the ongoing trade rhetoric and the move in risk assets,” said Mark Cabana, head of short U.S. rate strategy at Bank of America Merrill Lynch. Cabana said the market now believes a full blown trade war is coming, with taxes on all of China’s products.

“The concern the market has right now is that we’re moving toward a worst case scenario, and that could persist for quite some time. If that’s the case, then the market is believing the [weak] economic data, and the Fed will likely need to respond to that by trying to offset and prevent a recession,” he said.

Of course there is still enough hope in the marketplace to keep the floor from completely falling out from underneath investors, but at this point even CNBC’s Jim Cramer is admitting that “banking on hope” is not a good strategy…

“If you buy right now on anything other than a slammed, super-growth stock down on a general market pullback, well you’re banking on hope, and hope should never be a part of the equation,” the “Mad Money” host said.

From this point forward, we should start to see things escalate pretty quickly.

Relations with China are going to continue to deteriorate, and problems between the United States and China are going to expand well beyond the economic sphere.

But for the immediate future, most of the focus will be on the economic consequences of the trade war, and most of the “experts” are starting to openly admit that those consequences are going to be quite painful. The following comes from CNN

“You can’t have the world’s two largest economies in a long, drawn-out mutually destructive trade war and not slow the global economy,” said Art Hogan, chief market strategist at National Securities Corporation.

Of course Hogan is 100 percent correct. The trade war is going to hurt all of us economically, and very disturbing numbers are rolling in on a daily basis now. For example, we just learned that new manufacturing orders just fell for the first time since the last recession

American business activity tumbled to a three-year low in May due in large part to concerns about tariffs, according to a report released on Thursday by IHS Markit. New manufacturing orders declined for the first time since August 2009.

And as I pointed out the other day, global exports have also fallen to the lowest level that we have seen since 2009.

Once the dominoes start falling, all of our economic and financial bubbles could start bursting at the same time, and that could potentially create a crisis unlike anything that any of us have ever seen before.

My wife and I are both feeling a tremendous sense of urgency right now. So many of the things that we have been waiting and watching for are starting to unfold.

Many believed that 2019 was going to represent a major turning point, and that appears to be exactly what is happening.

So hold on to your hats, because the remainder of this year is likely to be extremely “interesting”.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Trade Talks Are Dead, And So U.S. Consumers Should Brace For A Long, Bitter, Painful Trade War With China

There is not going to be a trade deal between the United States and China any time soon, and that is going to mean a tremendous amount of pain for the U.S. economy. For months, hope that the U.S. and China would soon reach a trade deal helped to elevate global financial markets, but now that hope has disappeared. In order for a trade deal to happen, the two sides have to talk, and at this point no negotiations are scheduled. And unless one side or the other decides that they are willing to move dramatically from their current positions, there really isn’t any reason to talk. In fact, the Chinese government is openly saying that it is in “no rush” to negotiate with the United States…

Beijing is in “no rush” to resume trade talks between the U.S. and China, the according to the South China Morning Post.

After CNBC’s Kayla Tausche reported on Friday that trade talks between the U.S. and China have stalled, Chinese analysts said China is prepared to suspend meeting if President Donald Trump wasn’t “prepared to be realistic,” the Chinese newspaper said Saturday.

If Trump was willing to back way down and give the Chinese everything that they want, of course China would be more than happy to resume negotiations.

But that isn’t going to happen. Instead, the Trump administration demonstrated their resolve by sailing a U.S. Navy vessel into disputed waters in the South China Sea on Sunday. The following comes from Zero Hedge

Once again risking a confrontation with the Chinese Navy (at a particularly sensitive time, given where we are with the trade war) the Navy carried out another “freeop” in the South China Sea over the weekend.

A US Navy Arleigh Burke-class destroyer sailed within 12 miles of a disputed shoal, ignoring Beijing’s repeated warnings to stay away.

On Sunday, the USS Preble, a destroyer armed with Tomahawk missiles, sailed along the Scarborough Shoal, directly challenging China’s disputed claim to the area.

Every time we send a warship into the South China Sea, it drives China up a wall, and the Trump administration understands this very well.

Such a move definitely “sends a message” to China, but it also makes a trade deal much less likely.

Subsequently, Chinese President Xi Jinping just happened to decide to tour a rare earth production facility on Monday. Here is why that was so important

As Bloomberg reported overnight, shares in JL MAG Rare-Earth surged by the daily limit on Monday after Xinhua said the Chinese president had stopped by the company in Jiangxi, a scripted move designed to telegraph what China could do next.

The reason for the dramatic market response is that the presidential visit flags policy priorities, and “rare earths have featured in the escalating trade spat between the U.S. and China.” Specifically, as Bloomberg notes, China raised tariffs to 25% from 10% on American imports, while the U.S. excluded rare earths from its own list of prospective tariffs on roughly $300 billion worth of Chinese goods to be targeted in the next wave of measures. And just in case the White House missed the message, Xi was accompanied on the trip to JL MAG by Liu He, the vice premier who has led the Chinese side in the trade negotiations.

Why does China have a clear advantage in this area? Simple: the U.S. relies on China, the dominant global supplier, for about 80% of its rare earths imports.

If the Chinese cut off our rare earth imports, we would be in a world of hurt, and the Chinese know it.

But even if things don’t escalate any further, this trade war is quickly going to become exceedingly painful. According to a couple of recent studies, millions of U.S. jobs could soon be lost if this trade war is not resolved for an extended period of time…

About 2.1 million workers in aircraft manufacturing, beer brewing, tobacco and dozens of other industries stand to be affected by the trade war, according to an April study by the Brookings Institution. The impact would be evenly distributed between red and blue counties, Brookings found.

But a similar study by Axios last week found that Trump’s recent escalations could wind up affecting more than five times as many workers. The hardest hits will affect industries based in “rural, deeply red, already-struggling parts of the country,” including miners in Texas, furniture makers in North Carolina and sawmills in Alabama.

In addition, U.S. consumers are about to experience a significant case of sticker shock. Major retailers all over the country are going to have to raise prices due to these new tariffs on China, and that is going to mean a lower standard of living for many Americans…

By now, it is likely no surprise to American families that tariffs raise the cost of living. Walmart said last week that new import duties would lead to higher prices on a wide variety of consumer goods newly targeted by the latest promised round of tariffs. Retail trade groups warn that higher prices will be the norm, as China provided about 41% of all apparel, 72% of all footwear and 84% of all travel goods imported into the United States in 2017. Given the likely timeline for this latest escalation, these price hikes should hit American parents just in time for back-to-school shopping.

And if this trade war lasts long enough, many retailers are going to have to close their doors completely. The following comes from USA Today

The trade war with China could cause prices to rise on everything from toys to clothing, but it also could lead to “widespread store closures,” according to a report by UBS.

The investment bank’s analysis said tariffs on Chinese imports could put $40 billion of sales and 12,000 stores at risk.

“The market is not realizing how much brick & mortar retail is incrementally struggling and how new 25% tariffs could force widespread store closures,” UBS analyst Jay Sole wrote in the report. “We think potential 25% tariffs on Chinese imports could accelerate pressure on these company’s profit margins to the point where major store closures become a real possibility.”

We are already on pace to absolutely shatter the all-time record for store closings in a single year, and this trade war could make our ongoing “retail apocalypse” much, much worse.

On top of everything else, analysts at Morgan Stanley are warning that a complete collapse of trade talks “would push the world economy toward recession”. Of course the reality of the matter is that they have already collapsed and both sides are not pushing to schedule any more negotiations because there really isn’t anything to talk about.

So what this means is that things are about to get really hard, and it is time to prepare for an extended economic downturn.

The Chinese are desperately hoping that a Democrat can beat Trump in 2020 so that they will have someone more “reasonable” to deal with in the future.

But the 2020 election is a year and a half away.

Trump is going to continue to stand strong because he can’t afford to look weak on China with an election coming up, and the Chinese are not going to throw in the towel when they may only have to wait 18 months for Trump to be out of the picture.

So for now we have a trade war to deal with, and with each passing day it is going to become increasingly painful.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Wal-Mart Executive Warns: “Higher Tariffs Will Lead To Higher Prices For Customers”

Wal-Mart gets approximately one-fourth of all the merchandise that it sells from China, and Wal-Mart’s CFO is warning that “higher tariffs will lead to higher prices for customers”. In other words, U.S. consumers will soon be feeling a lot of pain. Over the last several decades, major retailers such as Wal-Mart have become increasingly dependent on exports from China, and U.S. consumers have loved the “low, low prices” because those rock bottom prices enabled our society to enjoy a greatly inflated standard of living. Of course in the process we were mortgaging our own economic future, because we have lost more than 60,000 manufacturing facilities and millions of good paying jobs since China first joined the WTO in 2001. But we didn’t care because ultra-low prices felt good, and so our economy became increasingly integrated with China’s economy. Well, now a trade war has begun and people all over America are demanding that we get tough with China. And without a doubt something needs to be done about China, but the process of decoupling from the Chinese economy is going to be exceedingly painful. We should have never allowed ourselves to become so dependent on China in the first place, and now the consequences for our past foolishness are going to be very bitter indeed.

Previously, I have warned that this trade war will be particularly painful for those on the bottom of the economic food chain, and now the CFO of Wal-Mart has confirmed that higher tariffs “will lead to higher prices for customers”

Walmart has said that prices for shoppers will rise due to higher tariffs on goods from China, joining other retailers in warning consumers of cost hikes for imports.

‘Higher tariffs will lead to higher prices for customers,’ Walmart Chief Financial Officer Brett Biggs said on Thursday following the company’s report on its first quarter results.

So what this means is that a hundred dollars will not go nearly as far as it once did when you are shopping at Wal-Mart.

And some of Wal-Mart’s biggest vendors are also sounding the alarm. For example, just consider what Del Monte CEO Greg Longstreet just said

Also, Walmart’s vendors have started to raise prices, among them Del Monte Foods, which supplies fresh and packaged goods to Walmart, including mandarin oranges imported from China. Prices will go up again with tariffs rising.

‘It´s not just tariffs. Transportation costs are up, labor costs are up. It´s an inflationary environment,’ Del Monte CEO Greg Longstreet told Reuters on the sidelines of a conference. ‘A lot of that’s going to have to be passed on. The consumer is going to have to pay more for a lot of critical goods.’

Unfortunately, Longstreet is 100% correct.

The price of everything is going to go up in the months ahead, and this is particularly true when it comes to food prices.

Meanwhile, the trade war is really starting to hit hard in other parts of the economy as well. At this point, the largest producer of farm tractors in the world is no longer “cautiously optimistic”

Deere & Co. is no longer “cautiously optimistic” as it has been for so long. The machinery giant reported lower-than-expected earnings and cut its annual guidance as its farmer customers shun major purchases amid uncertainty about demand for their products.

“Ongoing concerns about export-market access, near-term demand for commodities such as soybeans, and a delayed planting season in much of North America are causing farmers to become much more cautious about making major purchases,” Chief Executive Officer Sam Allen said in a statement Friday.

If the U.S. and China are able to come to a trade agreement soon, that would greatly help things.

But at this juncture no new talks have even been scheduled because there really isn’t anything to talk about

Scheduling for the next round of negotiations is “in flux” because it is unclear what the two sides would negotiate, two sources briefed on the status of the talks said. China has not signaled it is willing to revisit past promises on which it reneged earlier this month, despite showing up for talks in Washington last week.

Both sides have dug in on their positions this week. China propped up its currency and cut U.S. pork orders, while state media took on an increasingly nationalistic message. The Trump administration, meanwhile, put Chinese telecommunications company Huawei and its affiliates on a business blacklist and banned it from the supply chain, actions it had shelved earlier in the trade talks to smooth relations.

When President Trump decided to use the “nuclear option” on Chinese telecommunications giant Huawei, that was a major turning point.

At this moment, it would be difficult to overstate how angry the Chinese are at the Trump administration. The Global Times is a mouthpiece for the Chinese government, and they just published a scathing editorial in which they accused Trump of “a declaration of war on China in the economic and technological fields”. The following excerpt from that editorial comes from Zero Hedge

Huawei is the symbol of China’s ability to do independent research. As a private company, it is the forerunner of China’s reform and opening-up. It has been deeply engaged in the development of global communications and become the leader of 5G technology. That Huawei will not lose to the US is significant for China’s response to the US’ strategic suppression.

The US has completely abandoned commercial principles and disregarded law. Its barbaric behavior against Huawei by resorting to administrative power can be viewed as a declaration of war on China in the economic and technological fields. It is time that the Chinese people throw away their illusions. Compromise will not lead to US goodwill.

A breakdown in relations with China is part of the long-term scenario that we have been anticipating. But we had hoped that it would be put off for as long as possible, because what is coming next is going to be very painful.

This isn’t going to be just a trade war.

And in the long run, it isn’t going to be just an “economic war” either.

Unless somebody can pull off a miracle, things between are two nations are likely to start spiraling downhill rather quickly. As the trade war escalates, the U.S. and China will take turns retaliating back and forth, and the entire globe is going to suffer as a result.

So let us hope for a miracle, because at this point the outlook for the months ahead is definitely quite bleak.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Here Are 15 Numbers That Show How The Global Economy Is Performing, And All Of Them Are Bad

Global economic activity has already been slowing down dramatically, and the U.S. trade war with China is just going to make things worse. In so many ways, what we are witnessing in 2019 is quite reminiscent of what we witnessed as the last recession was beginning. Global exports are absolutely plummeting, auto sales are way down all over the globe, debt delinquencies are way up, and retailers are closing stores at a record pace. Even if the U.S. and China were getting along, things would be rough for the global economy in the months ahead, but a full-blown trade war between the two largest economies on the entire planet has the potential to be absolutely disastrous. We are truly in uncharted waters, and many believe that events are going to start accelerating very rapidly now.

Even though I write about this stuff on a daily basis, I have been surprised by how poor the global economic numbers have been lately.

And remember, earlier this month the global media were convinced that the U.S. and China were about to finalize a trade deal. Now that negotiations have completely broken down, we should expect that these numbers will soon get even worse.

The following are 15 numbers that show how the global economy is currently performing…

#1 Global exports are absolutely crashing and have now fallen to the lowest level since 2009.

#2 U.S. auto dealers are dealing with a backlog of 4.2 million unsold vehicles.

#3 Auto sales in Europe have fallen for seven months in a row.

#4 Chinese auto sales fell a whopping 16.6 percent in the month of April.

#5 Overall, Chinese auto sales have now fallen for 11 months in a row. That is a new all-time record.

#6 U.S. auto loan delinquencies have reached the highest level since the last recession.

#7 U.S. credit card delinquencies have hit the highest level in eight years.

#8 In April, U.S. manufacturing activity unexpectedly declined 0.5 percent.

#9 Thanks to the trade war, the price of soybeans just dropped to the lowest level since 2008.

#10 Party City just announced that it will be closing 45 stores.

#11 Fred’s just announced that they will be closing 104 more stores.

#12 In April, U.S. retail sales declined for the second time in three months.

#13 According to the Atlanta Fed’s latest forecast, U.S. GDP growth is expected to fall to just 1.2 percent in the second quarter of 2019.

#14 According to a new study just released by the Urban Institute, 40 percent of all Americans “sometimes struggle to afford housing, utilities, food or health care”.

#15 Overall, 59 percent of all Americans are currently living paycheck to paycheck according to a survey that was just conducted by Charles Schwab.

Leaders from both the U.S. and China are trying to act tough and say the right things, but everyone knows that this trade war is going to hurt both countries.

Economic numbers from both nations have been troubling lately, and one expert that was just interviewed by CNBC says that “it could get a lot worse”

Consumer and industrial activity in both the U.S. and China slowed in April, even before the world’s two biggest economies entered the latest phase of an escalating trade war that could take a bite out of global growth.

“The real message today is that both the economic data from the U.S. and China have disappointed. They’re like two boys in the sandbox that are spitting on each other, and it could get a lot worse,” said Marc Chandler, global market strategist at Bannockburn Global Forex.

In the short-term, it would greatly help if the U.S. and China could find a way to agree to a trade deal.

Unfortunately, the events of the past 48 hours have made that a lot less likely.

As I discussed yesterday, President Trump essentially took a sledgehammer to Chinese telecommunications giant Huawei. When the Commerce Department put Huawei on the “Entity List”, it essentially banned the company from buying much needed parts and components from U.S. firms. Some have described this as “the nuclear option”, and I think that description is quite accurate. In the end, this move is going to be absolutely devastating for Huawei.

Of course the Chinese are absolutely furious about this. Huawei is viewed with great national pride in China, and this move is considered to be a direct insult to Chinese national honor. Most Americans are not paying too much attention to the details of the trade war, but in China this is a really big deal and people are extremely angry. In fact, there has apparently been a run on “Donald Trump toilet brushes” in China in recent days because the Chinese are so angry.

Following my recent article about Huawei, a number of readers complained that I was being too soft on China. Of course that is not true at all. Long before Donald Trump ran for president, I was writing about how China was lying, cheating, stealing our technology and robbing us blind. I was literally begging for our politicians to stand up and do something, and I was thrilled when Trump started talking tough about China because I knew that he really understood these issues.

But I also want everyone to understand that trying to decouple from the Chinese economy would be extremely painful even in the most optimistic scenario. Our two economies have become extremely integrated, and we have become very dependent on China in many different ways. They buy our soybeans, they provide us with rare earth elements, and they own more than a trillion dollars of our debt. Looking at it from the Chinese perspective, they have countless ways that they can hurt us, and the angrier we make them the more likely it will be that they will lash out at us.

When negotiating with China, you need to be tough but you also need a lot of finesse. Taking a baseball bat and slamming it into their kneecaps is not going to work.

If we destroy our relationship with China, that is going to result in us going down a very dark path. Yes, China is an evil empire that has no respect for human rights at all. There is no freedom of speech in China, over the past year they have been shutting down lots of churches and burning lots of Bibles, and they have been systematically throwing members of other religious minorities into concentration camps.

So I don’t have any sympathy for the communist Chinese government at all. I just want all of you to understand that they are a very dangerous adversary, and a protracted trade war could be truly disastrous for the entire global economy.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

If The Chinese Were Upset Before, Now They Are Going To Be Absolutely Furious After Trump’s Latest Move

President Trump is doubling down on his tough approach with China, and apparently he has decided that now is the time to cripple their most important tech company. Huawei Technologies sells more telecommunications equipment than anyone else in the entire world, and it was anticipated that they would be one of the global leaders in the rollout of 5G networks all over the planet. The company ranks 72nd on the Fortune Global 500 list, and at this point they sell more phones than Apple does. Essentially, Huawei is China’s version of Apple, and the company is greatly loved by the communist government in China. So if President Trump really wanted to piss off China, taking a sledgehammer to Huawei would be a great way to do it, and that is precisely what he just did.

On Wednesday, Trump’s Commerce Department officially added Huawei to their “Entity List”

The U.S. Commerce Department said on Wednesday it is adding Huawei Technologies Co Ltd and 70 affiliates to its so-called “Entity List” – a move that bans the telecom giant from buying parts and components from U.S. companies without U.S. government approval.

U.S. officials told Reuters the decision would also make it difficult if not impossible for Huawei, the largest telecommunications equipment producer in the world, to sell some products because of its reliance on U.S. suppliers.

Basically, this is the equivalent of taking a baseball bat and slamming it into the company’s knees.

There have been allegations that “Huawei’s infrastructure equipment contains backdoors that may enable surveillance by the Chinese government“, and those allegations are almost certainly true.

But this sure is going to make the Chinese angry.

The following is the full statement about this move from Commerce Secretary Wilbur Ross…

Today, the Bureau of Industry and Security (BIS) of the U.S. Department of Commerce announced that it will be adding Huawei Technologies Co. Ltd. and its affiliates to the Bureau’s Entity List. This action stems from information available to the Department that provides a reasonable basis to conclude that Huawei is engaged in activities that are contrary to U.S. national security or foreign policy interest. This information includes the activities alleged in the Department of Justice’s public superseding indictment of Huawei, including alleged violations of the International Emergency Economic Powers Act (IEEPA), conspiracy to violate IEEPA by providing prohibited financial services to Iran, and obstruction of justice in connection with the investigation of those alleged violations of U.S. sanctions.

The sale or transfer of American technology to a company or person on the Entity List requires a license issued by BIS, and a license may be denied if the sale or transfer would harm U.S. national security or foreign policy interests. The listing will be effective when published in the Federal Register.

“This action by the Commerce Department’s Bureau of Industry and Security, with the support of the President of the United States, places Huawei, a Chinese owned company that is the largest telecommunications equipment producer in the world, on the Entity List. This will prevent American technology from being used by foreign owned entities in ways that potentially undermine U.S. national security or foreign policy interests,” said Secretary of Commerce Wilbur Ross. “President Trump has directed the Commerce Department to be vigilant in its protection of national security activities. Since the beginning of the Administration, the Department has added 190 persons or organizations to the Entity List, as well as instituted five investigations of the effect of imports on national security under Section 232 of the Trade Act of 1962.” Additions to the Entity List are decided by the End-User Review Committee which is comprised of officials from the Department of Commerce, Department of Defense, State Department, and Department of Energy. Under § 744.11(b) of the Export Administration Regulations, persons or organizations for whom there is reasonable cause to believe that they are involved, were involved, or pose a significant risk of becoming involved in activities that are contrary to the national security or foreign policy interests of the United States, and those acting on behalf of such persons, may be added to the Entity List.

The Bureau of Industry and Security’s mission is to advance U.S. national security and foreign policy objectives by ensuring an effective export control and treaty compliance system and promoting continued U.S. strategic technology leadership. BIS is committed to preventing U.S.-origin items from supporting Weapons of Mass Destruction (WMD) projects, terrorism, or destabilizing military modernization programs.

If the Chinese have been using Huawei equipment to spy on us, then this move is certainly justified.

But timing is everything in life, and this comes at a time when negotiations on a new trade deal have just broken down.

Trump may be thinking that tough moves like this could force China back to the negotiating table, but there is also the possibility that this extremely aggressive approach could completely destroy our relations with the Chinese.

One hopeful sign is the fact that Huawei immediately released a statement after they were put on the “Entity List” which stated that they are willing to work with the U.S. government to “come up with effective measures to ensure product security”

“Huawei is the unparalleled leader in 5G. We are ready and willing to engage with the US government and come up with effective measures to ensure product security. Restricting Huawei from doing business in the US will not make the US more secure or stronger; instead, this will only serve to limit the US to inferior yet more expensive alternatives, leaving the US lagging behind in 5G deployment, and eventually harming the interests of US companies and consumers. In addition, unreasonable restrictions will infringe upon Huawei’s rights and raise other serious legal issues.”

Huawei executives understand how crippling this move will be to their business, and so a little groveling is understandable.

But overall, the Chinese public is going to be extremely angry when they hear this news.

And let us not forget that there is still simmering anger over the arrest of Huawei CFO Meng Wanzhou as she was changing planes in Canada. She was grabbed at the request of U.S. officials, and now they are trying to extradite her to the United States so that she can go on trial. Meng Wanzhou is a national hero in China, and the Chinese consider what we are doing to her to be a grave national insult.

Relations with China will never return to “normal” until we release Meng Wanzhou, but U.S. officials don’t seem to understand this.

Most Americans don’t spend too much time thinking about China, but right now anger toward the United States is rising to frightening levels among the Chinese. They are already talking about a “people’s war” against our country, but so far we don’t seem to be taking that very seriously.

In the end, bullying China is not going to work. Instead, our relations with China are likely to get a lot worse, and that would be absolutely catastrophic for both countries.

We will see what happens, but right now we sure seem to be headed down a very ominous path.

And after this latest move, the Trump administration can pretty much forget about a trade deal with China any time in the foreseeable future.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Investors May Be Laughing At China’s “People’s War” Now, But Here Is Why They Won’t Be Laughing For Long…

Wall Street is still treating this crisis as a temporary trade dispute, but the Chinese see things completely differently. At this point, the narrative in China is that the U.S. has deeply insulted their national honor, and every angry statement from U.S. officials is just digging the knife in a little bit deeper. The Chinese began their retaliation to Trump’s new tariffs with some new tariffs of their own, but they won’t be stopping there. As I stated yesterday, China literally has hundreds of different ways that they can hurt us, and the longer this crisis goes the more likely it is that they will utilize all of those weapons.

And we got a hint of what might be coming on Tuesday. An editorial published in government-run media outlets boldly proclaimed that the conflict between the United States and China was now a “people’s war”

In a series of opinion pieces and on-air editorials, the country’s government-controlled media used strong and nationalistic language to reassure a shaky domestic audience that China’s economy can weather the higher tariffs imposed last Friday by US President Donald Trump.

One strongly worded editorial published by both the Xinhua News Agency and the People’s Daily, the Communist Party mouthpiece, said that while the US was fighting for “greed and arrogance,” China fought to defend “its legitimate rights and interests.”

“The trade war in the United States is the creation of one person and his administration who have swept along the entire population of the country. Whereas the entire country and all the people of China are being threatened. For us, this is a real ‘people’s war,'” the editorial said.

And similar sentiments were expressed on state-owned television during a prime time broadcast

During a prime time broadcast on Monday, CNN reported that the state broadcaster CCTV also aired a statement saying that China would “fight for a new world.”

“As President Xi Jinping pointed out, the Chinese economy is a sea, not a small pond,” anchor Kang Hui said on his 7 p.m. news show. “A rainstorm can destroy a small pond, but it cannot harm the sea. After numerous storms, the sea is still there.” Hui concluded echoing a popular refrain, that “China…doesn’t want to fight, but it is not afraid to fight.”

Amazingly, U.S. stocks actually went up on Tuesday following these remarks. Apparently investors think that China’s new “people’s war” is pretty funny.

But they won’t be laughing when China starts playing hardball with us.

For example, how much pressure do you think that President Trump will feel when the Chinese suddenly announce a national boycott of U.S. goods in the middle of Trump’s re-election campaign?

As CNBC has pointed out, China has implemented such boycotts numerous times before…

At the height of the South China Sea conflict in 2016, China administered an unofficial boycott of mangoes and bananas from the Philippines. The region is still in dispute.

Years before that, China boycotted salmon from Norway during a hotly contested human rights issue, and Norway eventually relented.

Five years back, the world’s second largest economy also boycotted Japanese cars and minerals over a territorial dispute in the East China Sea.

In addition, a massive Chinese boycott of South Korean goods in 2017 turned out to be an immense blow to the South Korean economy.

What do you think that it would do to the U.S. economy and to U.S. financial markets if China suddenly did the same thing to us?

It would be absolute chaos, and Trump would feel an unbelievable amount of pressure to cave in because his re-election prospects would be diminishing with each passing day.

This is a strategic advantage that the Chinese have over Trump. They don’t have to worry about the calendar, but Trump does.

And Trump could not hit back by declaring a national boycott of Chinese goods because he does not have that authority. He could ask his supporters to conduct such a boycott, and undoubtedly some of them would go along, but most Americans would just continue to shop the way that they are shopping right now.

If large U.S. corporations lose all access to the second largest economy in the world, it would be a complete and utter disaster for them. As Matt Egan has pointed out, the Chinese market has become “a critical growth engine” for some of the largest U.S. brands…

China’s booming middle class is a critical growth engine for Boeing (BA), Apple, Nike (NKE) and other American brands. China is expected to keep growing in importance as a buyer. And America’s insatiable appetite for cheap goods has created a Chinese factory juggernaut that employs millions of workers.

The world’s two largest economies are each other’s biggest trading partners. Nearly $700 billion in goods were sent between China and the United States in 2018 alone. And with $1.1 trillion of Treasuries, China is America’s largest foreign creditor.

In 2018, Apple reported total revenue of 265.6 billion dollars.

51 billion dollars of that total came from China.

Apple is extremely vulnerable, and so are dozens of other large U.S. corporations.

Out in the middle of the country, many farmers are already almost mad enough to pick up their pitchforks and march on Washington because of this trade war.

As a result of our deteriorating trade relationship, soybean exports from the U.S. to China have fallen from $14 billion in 2016 to $12 billion in 2017 to just 3.1 billion in 2018.

Desperately hoping that things would turn around, U.S. soybean farmers have stockpiled an all-time record of almost 1 billion bushels of soybeans

Since December, when U.S. and China negotiators called a truce to tariffs and began signaling that an agreement might be reached, soybean farmers had been holding out hope that sales to China would resume, said Todd Hultman, an Omaha-based grain market analyst with agriculture market data provider DTN. In the meantime, the farmers had been storing a record stockpile of nearly 1 billion bushels.

The latest news of a new round of tariffs, with no agreement in sight, spooked the financial markets and some farmers who had been tentatively optimistic.

And now that trade negotiations have completely fallen apart, the price of soybeans is falling like a rock. In fact, we just saw it hit the lowest level in a decade.

Needless to say, the American Soybean Association is not at all pleased with the latest developments…

In a statement Monday, the American Soybean Association reacted with frustration edged with anxiety.

“The sentiment out in farm country is getting grimmer by the day,” said John Heisdorffer, a soybean farmer in Keota, Iowa, who is chairman of the ASA. “Our patience is waning, our finances are suffering and the stress from months of living with the consequences of these tariffs is mounting.”

Of course soybean farmers are far from alone. Thousands upon thousands of farmers all over America are on the brink of financial ruin, and one J.P. Morgan analyst is describing it as a “perfect storm” for U.S. farmers…

The state of American agriculture is “rapidly deteriorating” into crisis, J.P. Morgan said Tuesday, due to three factors: declining exports, a poor crop of corn and soybeans and the trade war with China.

“Overall, this is a perfect storm for US farmers,” J.P. Morgan analyst Ann Duignan said in a note to investors.

It is funny how that term keeps popping up. Without a doubt, a perfect storm is rapidly coming together for the entire U.S. economy, but most Americans are still in denial about what is happening.

As for this “trade dispute”, the truth is that it isn’t going to go away any time soon.

In fact, a senior official in the Trump administration just told Axios that “he can’t see the fight getting resolved before the end of the year”…

A senior administration official said the differences between the two sides are so profound that, based on his read of the situation, he can’t see the fight getting resolved before the end of the year.

The longer this trade war lasts, the more painful it will become for the U.S. economy.

And as we move toward a presidential election year, the Chinese will increasingly be the ones with the strategic leverage.

So Wall Street can laugh for now, but the Chinese are fully convinced that they will be having the last laugh in this matter.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Stocks Crater – 3.5 Trillion Dollars In Global Market Cap Wiped Out – China Considers “Dumping U.S. Treasuries”

Wall Street responded to our escalating trade war with China by throwing a bit of a temper tantrum. On Monday the Dow Jones Industrial Average was down 617 points, and that was the worst day for the Dow since January 3rd. But things were even worse for the Nasdaq. It had its worst day since December 4th, and overall the Nasdaq is now down 6.3 percent in just the last six trading sessions. Of course it isn’t just in the United States that stocks are declining. Since last Monday, a total of approximately $3.5 trillion in market cap has been wiped out on global stock markets. And since it doesn’t look like we are going to get any sort of a trade deal any time soon, this could potentially be just the beginning of our problems.

China fired a shot that was heard around the world on Monday when they announced that they would be dramatically raising tariffs on U.S. goods

China will raise tariffs on $60 billion in U.S. goods in retaliation for the U.S. decision to hike duties on Chinese goods, the Chinese Finance Ministry said Monday.

Beijing will increase tariffs on more than 5,000 products to as high as 25%. Duties on some other goods will increase to 20%. Those rates will rise from either 10% or 5% previously.

According to CNBC, these new tariffs are going to be particularly damaging for U.S. farmers…

The duties in large part target U.S. farmers, who largely supported Trump in 2016 but suffered from previous shots in the Trump administration’s trade war with China. The thousands of products include peanuts, sugar, wheat, chicken and turkey.

When you combine the impact of these Chinese tariffs with the unprecedented flooding that we have seen in the middle of the country, the result is that thousands upon thousands of U.S. farmers are going to be pushed into bankruptcy before the end of 2019.

But China might not stop with just increasing tariffs. According to Global Times Editor in Chief Hu Xijin, China “may stop purchasing US agricultural products” entirely, and the Chinese are also examining “the possibility of dumping US Treasuries”…

China may stop purchasing US agricultural products and energy, reduce Boeing orders and restrict US service trade with China. Many Chinese scholars are discussing the possibility of dumping US Treasuries and how to do it specifically.

As I mentioned yesterday, China literally has hundreds of different ways that they can hurt us.

So the truth is that those that are suggesting that the U.S. will not be hurt by this trade war are just being delusional.

In an article that was posted on Monday, CNBC referred to dumping Treasuries as “China’s nuclear option”…

Consider it China’s nuclear option in the trade war with the U.S. — the ability to start dumping its massive pile of Treasury bonds that could trigger a surge in interest rates and substantially damage the American economy.

As the two sides engage in a tit-for-tat tariff exchange, the possibility that China might raise the stakes and stop being the world’s biggest consumer of U.S. debt again reared its imposing head Monday.

The longer this trade war lasts, the angrier the Chinese will become, and the more damage they will inflict upon our economy.

And without a doubt, this trade war could be more than enough to push us into a new recession. On Monday, Michael Wilson of banking giant Morgan Stanley authored this ominous forecast

“Given other cost pressures and stubbornly low inflation, we are unconvinced that companies will generally be able to fully offset tariff costs through raising prices or through cost efficiencies elsewhere, meaning tariffs will press on margins,” Wilson wrote. “In the case of 25% tariffs on all of China’s exports to the US, we are inclined to think this has the potential to tip the US economy into recession given the cost issues companies are already dealing with.”

Before I end this article, there are two more points that I would like to make. Firstly, the price of soybeans is absolutely tanking right now, and this is going to be absolutely catastrophic for soybean farmers

With the most recent news of the intensifying tensions between the U.S. and China, the price of soybeans has dropped below $8 a bushel for the first time since 2008, which comes as many Midwest farmers are facing rampant flooding on their land during the planting season.

At this point in the year, around 60 to 70 percent of crops should be planted, John Newton, the chief economist of the Farm Bureau, said. Most expect the USDA to soon announce that, because of flooding and other difficulties, American farmers are only 35 percent planted so far.

I put that last paragraph in bold for a reason. It is the middle of May, and U.S. farmers have only planted about half the crops that they would normally have planted by this time of the year.

That is a national crisis, and it also means that U.S. food production is going to be way down this year.

This is a theme that I have been hammering on over and over again, and hopefully people are getting prepared for much, much higher prices at the grocery store.

Secondly, financial markets got a boost on Monday evening when President Trump indicated that the next “three or four weeks” will determine the success of trade talks with China…

Speaking at a White House event on Monday evening, U.S. President Donald Trump offered a projection about how much longer Washington and Beijing could be locked in heated trade negotiations.

“We’ll let you know in three or four weeks if it’s successful,” he said, according to NBC News.

Trump is expected to meet with the Chinese president some time in June, and the hope that they will be able to work out a deal will probably keep global financial markets from completely tanking in the next few weeks.

Of course there is still likely to be quite a bit of volatility for global stocks in the short-term, but if there is no trade agreement by the end of next month, July could potentially be an absolutely pivotal month for global financial markets.

So stay tuned, because it looks like things could soon be getting very, very interesting…

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Economic Doom: China Says That There Will NEVER Be A Trade Deal Until The U.S. Agrees To Their Demands

Unless someone backs down in a major way, this trade war is going to last for a very long time, and the Chinese have made it exceedingly clear that they are never going to back down on the core issues. So that means that the only way out is for President Trump to back down, and with an election looming in 2020, his advisers are telling him that now is the time to be very tough with China. Bernie Sanders and other top Democrats have staked out positions that are just as tough on China as Trump is being, and so if Trump backs down now he will be absolutely hammered by the other side for being weak. But if investors become fully convinced that a protracted trade war is in our future, that could be enough to set off a new financial crisis and throw the global economy into a tailspin. It definitely looked like we were headed for a major economic downturn anyway, and so this trade crisis could certainly be more than enough to push us over the edge.

In a very rare move, the Chinese have publicly revealed what it is going to take for a trade deal to happen.

According to Vice Premier Liu He, China has three key demands that must be met

In a wide-ranging interview with Chinese media after talks in Washington ended Friday, Vice Premier Liu He said that in order to reach an agreement the U.S. must remove all extra tariffs, set targets for Chinese purchases of goods in line with real demand, and ensure that the text of the deal is “balanced” to ensure the “dignity” of both nations.

Liu’s three conditions underscore the work still to be done if an accord is to be reached between the world’s two largest economies. President Donald Trump’s administration told China it has a month to seal a trade deal or face tariffs on all its exports to the U.S.

That first demand is definitely “a sticking point” for the Trump administration.

In fact, the Trump administration has been adamant that the removal of current tariffs will not happen until the Chinese show that they are following through on their commitments

By insisting that it wouldn’t remove any tariffs upon closing a deal, the U.S. gave Beijing little incentive to accept tough conditions. The U.S. position remained firm: no tariff removal until Beijing showed it would carry through on the commitments it made under the deal. On top of that, the U.S. wanted China to pledge not to retaliate if the U.S. were to reimpose tariffs if it found China in violation of some provisions.

In essence, the U.S. wants a trade agreement with very tough enforcement provisions, and the Chinese feel like such an agreement would be a slap in the face.

Responding to these developments, the main government-run newspaper in China struck a defiant tone

“At no time will China forfeit the country’s respect, and no one should expect China to swallow bitter fruit that harms its core interests,” the People’s Daily, a newspaper controlled by the Chinese ruling Communist Party, said in a commentary on Monday.

And an editorial in the Global Times made it quite clear that China will be willing to fight a trade war if that is what is necessary

China’s nationalist Global Times tabloid said in an editorial on Monday that the country had no reasons to fear a trade war.

“The perception that China cannot bear it is a fantasy and misjudgment,” the commentary said.

“If they weren’t being seriously provoked, the Chinese people would not favor any trade war. However, once the country is strategically coerced, nothing is unbearable for China in order to safeguard its sovereignty and dignity as well as the long-term development rights of the Chinese people.”

The Editor in Chief at the Global Times, Hu Xijin, insists that the position of the Chinese government will not change no matter how high Trump raises tariffs

China has made public 3 core concerns that must be addressed & it won’t make concessions on. From perspective of China’s politics, there is little room for compromises. They will insist. This political logic won’t be changed no matter how much additional tariffs the US will impose.

Of course Trump is not exactly being conciliatory either. For example, check out what he just posted on his Twitter account

China is DREAMING that Sleepy Joe Biden, or any of the others, gets elected in 2020. They LOVE ripping off America!

It’s true, but that is not the sort of thing that you say if you hope to make a deal.

And earlier, Trump insisted that we “are right where we want to be with China”

We are right where we want to be with China. Remember, they broke the deal with us & tried to renegotiate. We will be taking in Tens of Billions of Dollars in Tariffs from China. Buyers of product can make it themselves in the USA (ideal), or buy it from non-Tariffed countries…

….We will then spend (match or better) the money that China may no longer be spending with our Great Patriot Farmers (Agriculture), which is a small percentage of total Tariffs received, and distribute the food to starving people in nations around the world! GREAT!

Without a doubt, previous administrations allowed the Chinese to walk all over us, and we must either stand up for ourselves or we are going to continue to get abused.

As one U.S. official put it, “sometimes you need to say ‘stop screwing me.’”

But now that a trade war has begun, the conflict could get quite dirty.

Most analysts seem to assume that tariffs will be the only weapon of choice, but what if China decides to cut off our access to rare earth elements? The U.S. rare earth industry is greatly underdeveloped because we assumed that we could always get all that we wanted from China.

Well, if they cut us off we will be in a world of hurt.

And that is just one example. The Chinese can literally hurt us in hundreds of different ways, and they will not hesitate to exert pressure where needed.

A trade war is going to hurt the U.S., it is going to hurt China, and it is going to hurt everyone else too. In fact, this could be what triggers the next great economic meltdown.

Doing nothing about China was not an option, because they have been robbing us blind. But a cataclysmic trade war is not a good option either.

In the end, getting a trade agreement with China that addressed our core concerns without throwing the entire global economic system into chaos would have been preferable.

But that didn’t happen, and now everyone should be bracing for disaster as we enter a very uncertain future.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

How The Trade War Is Going To Affect You And Your Family

As expected, trade negotiations with China concluded on Friday with no trade deal in sight. Treasury Secretary Steven Mnuchin called the negotiations “constructive”, and that helped calm the financial markets, but there really isn’t any reason to be optimistic at this point. The negotiations that happened this week did not even come close to producing a deal, and neither side is attempting to claim that there will be an agreement in the near future. Instead, it appears that moves are being made that could lead to a protracted trade war. In fact, according to Bloomberg the Trump administration has just given the Chinese another ominous deadline…

The U.S. gave its bottom line during the talks in Washington, saying Beijing had three to four weeks more to reach an agreement before the Trump administration enacts additional tariffs on $325 billion of Chinese imports not currently covered by punitive duties, according to two people familiar with the talks.

These tariffs would be in addition to the ones that President Trump just hammered China with. And Trump is not waiting to see how future talks with China turn out either. According to a statement from U.S. Trade Representative Robert Lighthizer, Trump has already initiated the process for implementing these new tariffs

In an unexpected Friday development – President Trump began the process of raising tariffs on all remaining imports from China, valued at approximately $300 billion. The move follows a Friday tariff increase on Chinese imports from 10% to 25% effective just after midnight.

US Trade Representative Robert Lighthizer issued a Friday statement – after market hours of course – which reads:

“Earlier today, at the direction of the President, the United States increased the level of tariffs from 10 percent to 25 percent on approximately $200 billion worth of Chinese imports. The President also ordered us to begin the process of raising tariffs on essentially all remaining imports from China, which are valued at approximately $300 billion.”

This is a very clear sign that negotiations with China did not go well.

If they had gone well, Trump would not be threatening China like this.

So it looks like we should all get prepared for an extended trade war, and this trade war is going to affect you and your family in a number of different ways.

First of all, we should all expect significantly higher prices at major retailers…

American retailers and manufacturers were largely able to absorb the 10% tariff — narrowing their profit margins — negotiate offsetting price cuts with Chinese suppliers, import a big stockpile of goods before the tariff took effect, and spread the added cost across many products. But a 25% duty is too much to camouflage with such tactics and a big chunk of it is expected to be passed to U.S. shoppers.

In particular, price increases will be felt most acutely at large retail chains such as Wal-Mart that purchase goods in massive quantities from China. Needless to say, this will hurt those at the bottom of the economic food chain the most.

Secondly, this trade war will potentially result in a loss of jobs and income for many Americans. In fact, the Trade Partnership estimates that 2.1 million U.S. jobs will be lost if Trump’s next round of tariffs is imposed

If Trump slapped a 25% tariff on the remaining $325 billion in goods the U.S. imports from China, it would cost the U.S. 2.1 million jobs and the average family of four more than $2,000 a year, according to the Trade Partnership analysis.

Thirdly, economic growth would definitely be impacted by an extended trade war. The following bit of analysis comes from CNN

And then there’s the “extreme scenario” of full-blown, multilateral trade war. In this scenario, Oxford Economics modeled the impact of the U.S. putting 35% tariffs on all Chinese imports and 25% auto tariffs globally, plus 10% blanket tariffs on all other goods imported from the EU, Taiwan and Japan — with all countries retaliating in kind.

The firm calculated this would result in a 2.1% hit to U.S. GDP in 2020, pushing the economy into recession later this year. China’s economy would contract by 2.5%, while Europe and Japan would see average GDP losses of 1.5% and world GDP would be reduced by 1.7%.

Unfortunately, the truth is that the projections from Oxford Economics are way too optimistic. As I detailed yesterday, our trade war in the 1930s was absolutely catastrophic for the U.S. economy

On June 17th, 1930 President Hoover signed the Smoot-Hawley Act which imposed tariffs on more than 20,000 imported goods.

This coincided with the worst economic downturn of the 20th century. U.S. GDP declined 8.5 percent in 1930, 6.4 percent in 1931 and 12.9 percent in 1932.

Fourthly, an extended trade war would mean big trouble for global financial markets. Over 2 trillion dollars of global stock market wealth has been wiped out so far, but that is nothing compared to what could be coming

The trade war between the United States and China is back on. So far, markets haven’t sustained huge losses. That will change if tensions continue to escalate.

With higher tariffs coming into effect, the next risk analysts see is a complete breakdown in negotiations between Washington and Beijing.

“If the deal totally falls apart, we think there’s a pretty big chance of a market correction,” said Ryan Detrick, senior market strategist at LPL Financial. US stocks could fall as much as 5% over the next month, he added.

But the Trump administration can’t back down now, or else it would lose all credibility.

According to the latest numbers, we bought 539.5 billion dollars worth of goods from China last year but they only purchased 120.3 billion dollars worth of goods from us. For years they have been slapping enormous tariffs on us, stealing our intellectual property and making it exceedingly difficult for U.S. businesses to do business over there.

Meanwhile, they have been flooding our shores with cheap goods produced by government-subsidized businesses, and they have been getting exceedingly wealthy as a result.

So we can either allow them to keep taking advantage of us, or we can stand up for ourselves.

But let there be no doubt – standing up to China will be extremely painful economically. And at this stage of our society, Americans are not even equipped to handle a low level of economic pain.

A perfect storm is brewing, and this trade war is just a small part of it.

Sometimes you can try to do the right thing, but it turns out badly anyway. Standing up to China definitely needs to be done, but it is very difficult to see how this is going to end pleasantly. In fact, many believe that our relations with China are about to take a major turn for the worse.

We shall see what happens. As always, let us hope for the best, but let us also prepare for the worst.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

The Deadline Passes And Trump Brings Down The Tariff Hammer – China Immediately Promises To Retaliate

At 12:01 AM eastern time on Friday, President Trump followed through on his threats and hit China with a massive tariff increase. As you will see below, China immediately pledged to retaliate. U.S. and Chinese officials will continue to negotiate throughout the day on Friday, but if U.S. officials were optimistic that a deal was imminent the trigger never would have been pulled on these tariffs. At this point the gap between the negotiating positions of the two sides is still enormous, and that does not seem likely to change. The Chinese have been taking advantage of the United States for decades, and they wish to continue doing so. Meanwhile, President Trump and his advisers are absolutely determined to level the playing field. Unless one of the parties backs down in a major way, there is not going to be a trade agreement and this trade war is about to get very real, and that is extremely bad news for the global economy.

Just minutes ago, the deadline that the whole world was watching passed, and as expected Trump’s tariffs were imposed. The following comes from Bloomberg

The U.S. hiked tariffs on more than $200 billion in goods from China on Friday in the most dramatic step yet of Donald Trump’s push to extract trade concessions, deepening a conflict that has roiled financial markets and cast a shadow over the global economy.

China immediately said in a statement it is forced to retaliate, but didn’t specify how.

On Thursday evening, global markets were tentatively hopeful as U.S. and Chinese officials met to negotiate. According to White House Deputy Press Secretary Judd Deere, negotiations will continue in the morning

“This evening, (United States Trade Representative Robert Lighthizer) and (Treasury Secretary Steven Mnuchin) met with President Trump to discuss the ongoing trade negotiations with China. The Ambassador and Secretary then had a working dinner with Vice Premier Liu He, and agreed to continue discussions tomorrow morning at USTR,” Judd Deere, White House Deputy Press Secretary, said in a Thursday evening statement.

But the negotiations did not go well enough to even delay the implementation of the tariffs.

Trump followed through on what he promised he would do, and the Chinese say that they have “already prepared a response for all kinds of outcomes”

At the same time the Chinese side has already prepared a response for all kinds of outcomes, Gao Feng, commerce ministry spokesperson, said in Mandarin, according to a CNBC translation. He was speaking at Thursday’s weekly press conference.

It is likely that the Chinese did not immediately respond with new tariffs of their own because they would like to see how negotiations go on Friday.

In the end, the Chinese would love to get Trump to put a hold on tariffs yet again without giving him the trade agreement that he desperately wants. Throughout this process, the Chinese tactic has been to delay, delay, delay and they will undoubtedly do their best to try to kick the can down the road once again.

But Trump has figured out that they have been trying to run out the clock on his administration, and this time he is putting his foot down.

And without a doubt, it is definitely good to see a presidential administration finally standing up to the Chinese. They have been ruthlessly taking advantage of us and ripping us off blind for years, and that must stop.

Here is just one example of this that Trump often likes to share

“When a car is sent to the United States from China, there is a Tariff to be paid of 2 1/2%. When a car is sent to China from the United States, there is a Tariff to be paid of 25%,” Trump tweeted April 9. “Does that sound like free or fair trade. No, it sounds like STUPID TRADE – going on for years!”

Of course Trump is exactly correct. It is not “free trade” and it is definitely not “fair trade”. If they want to impose 25 percent tariffs on our auto industry, they should expect the same treatment for their key industries in return.

All along, Trump has insisted that if China wants to remove all their tariffs that we would be willing to do the same thing, but the Chinese would never agree to do that.

So Trump is standing up to China, and that is a good thing.

Unfortunately, upsetting the status quo will also be exceedingly painful.

A full-blown trade war with China will be really, really bad for the global economy. If Trump understood how bad things could potentially get, he probably never would have gone down this road, because it is going to be exceedingly difficult to get re-elected if the economy tanks.

I think that a little review of what happened during our last trade war will help us get a little perspective on what could be ahead.

On June 17th, 1930 President Hoover signed the Smoot-Hawley Act which imposed tariffs on more than 20,000 imported goods.

This coincided with the worst economic downturn of the 20th century. U.S. GDP declined 8.5 percent in 1930, 6.4 percent in 1931 and 12.9 percent in 1932.

On June 12th, 1934 President Roosevelt signed the Reciprocal Tariff Act which essentially ended the trade war.

So what happened?

The U.S. economy grew 10.8 percent in 1934, 8.9 percent in 1935 and 12.9 percent in 1936.

Today, the global economy is far more interconnected than it was in the 1930s, and so the impact of a global trade war could potentially be much greater.

We need trade with China to be fair and balanced, but are we willing to go through an extraordinary amount of economic pain to get to that end result?

And once relations with China break down, will they ever be able to be repaired?

We are at a critical turning point in U.S. history, and nobody is going to be able to turn back time once the dominoes begin to fall.

In the end, we are all going to have to live with the decisions that the Trump administration is making right now, and so let us hope that wisdom prevails.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Trump Spooks Global Markets: China “Broke The Deal. They Can’t Do That, So They’ll Be Paying.”

It sure looks like nothing can stop the trade war now, and that could potentially be absolutely disastrous for the global economy. The last major trade war began in 1930, and it turned an economic downturn into the Great Depression of the 1930s. But without a doubt something needed to be done about China. They have been lying, cheating and stealing our technology for a very long time, and previous administrations simply allowed them to walk all over us. President Trump had hoped that a new trade agreement would put trade between our two nations on a fair and equitable course from now on, but at this point it appears that isn’t going to happen.

On Wednesday evening, Trump commented on negotiations during a rally in northern Florida, and he greatly shook up global markets by stating that the Chinese “broke the deal” and that “they’ll be paying”

Speaking at a rally in Florida, the president attributed his recent threat of increased tariffs to Beijing’s negotiating position.

“By the way, you see the tariffs we’re doing? Because they broke the deal. They broke the deal,” Trump said. “So they’re flying in, the vice premier tomorrow is flying in — good man — but they broke the deal. They can’t do that, so they’ll be paying.”

In other words, Trump fully believes that the tariffs that he threatened China with on Sunday are going to go into effect on Friday.

All over the world stocks immediately began to fall following these comments, and one economist interviewed by CNBC said that Trump “is sure scaring the daylights out of the financial markets”…

Chris Rupkey, managing director and chief financial economist at global financial group MUFG, wrote in a note responding to Trump’s Wednesday evening speech that markets may continue to be roiled by that sort of rhetoric: “We are not sure who the president is addressing tonight in a campaign rally, but he is sure scaring the daylights out of the financial markets.”

For most of the year, global markets had been lifted by hopes of a trade deal, and now that it appears to be dead nobody is quite sure what is going to happen next.

Earlier on Wednesday, in a two part tweet Trump accused China of trying to drag out negotiations until after the 2020 election…

The reason for the China pullback & attempted renegotiation of the Trade Deal is the sincere HOPE that they will be able to “negotiate” with Joe Biden or one of the very weak Democrats, and thereby continue to ripoff the United States (($500 Billion a year)) for years to come….

….Guess what, that’s not going to happen! China has just informed us that they (Vice-Premier) are now coming to the U.S. to make a deal. We’ll see, but I am very happy with over $100 Billion a year in Tariffs filling U.S. coffers…great for U.S., not good for China!

Trump definitely nailed this one.

As I detailed on Monday and Tuesday, the Chinese had been hoping to run out the clock on the Trump administration and deal with whoever follows Trump in the White House. The mainstream media was absolutely shocked that Trump would say such a thing, but it is the truth.

U.S. negotiators truly believed that they were getting close to a deal in recent weeks, but a diplomatic cable which arrived from China late last Friday changed all that. The following comes from Reuters

The diplomatic cable from Beijing arrived in Washington late on Friday night, with systematic edits to a nearly 150-page draft trade agreement that would blow up months of negotiations between the world’s two largest economies, according to three U.S. government sources and three private sector sources briefed on the talks.

The document was riddled with reversals by China that undermined core U.S. demands, the sources told Reuters.

In essence, the Chinese had totally gutted the deal that the Trump administration had been working so hard on.

So now we know that Trump’s angry tweets on Sunday didn’t just come out of nowhere. He was greatly upset because “China got greedy”

One private-sector source briefed on the talks said the last round of negotiations had gone very poorly because “China got greedy.”

“China reneged on a dozen things, if not more … The talks were so bad that the real surprise is that it took Trump until Sunday to blow up,” the source said.

“After 20 years of having their way with the U.S., China still appears to be miscalculating with this administration.”

The only way that a trade deal will be possible now is if somebody backs way down, and that does not seem likely to happen.

In fact, the Chinese are already threatening to implement “necessary countermeasures” once Trump hits them with tariffs on Sunday…

China’s Commerce Ministry said Wednesday that Beijing will retaliate if U.S. tariffs on $200 billion of Chinese goods are hiked to 25% from 10% as threatened by President Donald Trump on Sunday.

“The escalation of trade friction is not in the interests of the people of the two countries and the people of the world,” the ministry said. “The Chinese side deeply regrets that if the US tariff measures are implemented, China will have to take necessary countermeasures.”

And even if by some miracle a trade agreement happens, the truth is that relations between the U.S. and China have already deteriorated so dramatically that there is no way we will be returning to “business as usual”. The following comes from a Bloomberg opinion piece

U.S. Secretary of State Mike Pompeo has been traveling the world warning allies that getting too close to China will harm relations with Washington. Buying telecom equipment from Huawei Technologies Co. would compel the U.S. to curtail intelligence-sharing, Pompeo has said, while participating in Beijing’s Belt and Road infrastructure bonanza was sanctioning “debt traps” and predatory business practices.

Add in fresh curbs on U.S. visas for Chinese scholars and heightened rhetoric over Beijing’s disputed territorial claims in the South China Sea, and the points of conflict now run well beyond tariffs and soybeans.

No matter what happens over the next few days, relations with China are going to get worse.

A lot worse.

Even though most Americans don’t realize it, this is a major turning point.

Begun, the trade war has, and the pain will ultimately be felt by every man, woman and child on the entire planet.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

If The Stock Market Is Falling This Much Already, What Is Going To Happen If There Is No Trade Deal With China By Friday?

If negotiations between the Trump administration and the Chinese government do not produce a trade deal by Friday, it is going to be absolutely catastrophic for Wall Street. On Tuesday, trade fears pushed the Dow Jones Industrial Average down 473 points. It was the second-worst trading day of 2019 so far, and at one point during the trading session the Dow had fallen as much as 648 points. But most of the experts are assuring investors that a trade deal with China will be finalized before Trump’s new tariffs go into effect on Friday. We are being told that the Chinese will almost certainly cave in on some of their most important demands and that Trump will get the favorable trade deal with China that he has been seeking.

But what if it doesn’t happen after all?

If the Chinese give in now, they will look exceedingly weak, and any trade deal will be hailed as a great victory for the Trump administration.

To me, it seems exceedingly unlikely that the Chinese would want to make any sort of a deal under such circumstances.

The Trump administration has essentially pointed a loaded gun at their heads and has told them that they better agree to a trade deal by Friday or else.

There are some countries with which such an approach would work, but China is definitely not one of them.

And I may not have as much “foreign policy experience” as John Bolton, but even I know that if you want to make a deal with China it is probably not a good idea to antagonize them with warships in the South China Sea at the same time you are trying to negotiate with them.

Perhaps I will be proven wrong, but it seems to me that trying to bully China could backfire spectacularly.

And at this point, the Trump administration better deliver a trade deal with China by Friday, because if they don’t there are going to be very serious consequences.

First of all, once investors realize that a trade deal with China is dead we are going to see a violent downturn in the stock market. According to one expert quoted by USA Today, “the market could go down another 10% plus”…

“The biggest threat to this market is the U.S.-China trade issues,” Ives said. “If China and the U.S. dig in on trade, it’s time to put on the hard hat because the market could go down another 10% plus.”

And in a CNBC article entitled “WORST CASE SCENARIO: Here’s what it looks like if Trump starts a trade war with China”, a figure of “10%” was also thrown around…

The worst-case outcome there, say experts, is a fight that sends the S&P 500 into a correction — which would be 10% off that key indicator. The companies likely to be hardest hit, say the experts, are likely Boeing, Apple and Caterpillar. They are all down about 5% this week already.

Then the pain ripples into the metals, mining and automobiles sectors.

Unfortunately, a decline of 10 percent is definitely not the “worst case scenario” that we could be facing.

As I have explained repeatedly, stock prices would need to decline by 40 or 50 percent just to get key valuation ratios back to their long-term averages.

And valuation ratios always return to their long-term averages eventually.

At this moment, we are still in the greatest stock market bubble of all time. Companies that have been losing mountains of money for years are supposedly worth billions of dollars, and it is just a matter of time before this giant charade ends.

Just consider the case of a company called Beyond Meat. The following comes from Wolf Richter

Just how silly this market has gotten is exemplified by Beyond Meat, a 10-year old company whose fake burgers – combining the worst of terrible burgers and unrecognizable industrially processed plant substances – have been sold for years, and whose shares following the IPO have skyrocketed to give the company a market capitalization of $4.6 billion though it has persistently lost money on its fake burgers and had sales in 2018 of only $56 million.

It’s apparently easier to sell stocks in this environment than it is to sell fake burgers. So the company is now valued at 83 times revenues. This is nuts.

We are so ripe for a major stock market crash, and a full-blown trade war with China could potentially be the trigger.

In addition, a full-blown trade war with China would be absolutely crippling for companies all across America. Here is just one example

Phil Page, the CEO of Missouri-based Cap America, estimates that his company has more than $1 million worth of baseball hats already ordered that will now be hit with the higher tariff.

“It’s very difficult to understand what the President is going to do by a business perspective. To spring it on us all at once like this is a very poor judgment on his part,” Page said.

“I thought this thing was going to be worked out this week,” he added.

Overall, one survey found that approximately 75 percent of all good-producing companies in the entire country would be negatively impacted by tariffs

About 75% of good-producing firms recently surveyed by the National Association for Business Economics said the tariffs have had a negative impact on their business.

Yes, China has been taking unfair advantage of us for a very long time, and this is something that I have written about extensively.

But these things must be handled with great diplomacy.

If there is no trade deal, this could be the moment when our relations with the Chinese enter a tailspin from which they never recover. A trade war would be extremely destructive for the U.S. economy, and history has shown us that trade wars have a tendency to eventually turn into shooting wars.

We will see what happens the rest of the week.

This is a critical turning point, and the Trump administration cannot afford to fail.

In closing, let me share with you this quote which I found earlier today in a CNBC article

“To paraphrase Lenin: there are decades where nothing happens and there are weeks when decades happen…and then there is a single week in the Trump Presidency. What a time to be alive.”

This is a make or break moment for the Trump administration, and it is a make or break moment for the entire U.S. economy.

By Friday, we shall know the outcome.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

The Dow Made A Miraculous 400 Point Recovery, But Now Renewed Trade Fears Are Sending Markets Plunging Once Again

If your head is spinning from the wild fluctuations that have shaken global financial markets, you are definitely not alone. On Sunday, President Trump angrily threatened to hit China with enormous new tariffs, and it looked like hopes for a trade deal between the United States and China had collapsed. Overnight, Chinese stocks had their worst session in three years, and many expected U.S. stocks to experience a similar plunge. But then on Monday we learned that the Chinese had decided to move forward with trade talks this week anyway, and global financial markets started rebounding in a major way. In fact, the Dow Jones Industrial Average rebounded more than 400 points

The Dow closed just 66 points lower on Monday, recovering from a plunge of as much as 471 points. The S&P 500 and Nasdaq also erased their sharp losses, ending just 0.5% lower.

The comeback signals investors don’t believe President Donald Trump’s surprise threat to impose higher tariffs on China will spark a painful deepening of the trade war. Optimists are even hoping an historic trade deal will still be reached.

Crisis averted, right?

Well, it certainly looked like smooth sailing was ahead until U.S. Trade Representative Robert Lighthizer told the press that new tariffs will still be imposed on Chinese goods on Friday. The following comes from Zero Hedge

While a Chinese delegation is still scheduled to visit Washington as planned this week, with talks to take place Thursday and Friday, U.S. Trade Representative Robert Lighthizer told reporters Monday that the Trump administration plans to increase duties on Chinese imports at 12:01 a.m. on Friday, accusing Beijing of backpedaling on commitments it made during negotiations.

U.S. and China had been making substantial progress on a trade deal, but in the past week China has reneged on some of its promises:

“We felt we were on track to get somewhere. Over the course of last week we have seen an erosion of commitments by China,” Lighthizer said, adding that significant issues remain unresolved, including whether tariffs will remain in place.

The result, more than half of the intraday gains have been erased already…

This is a huge gamble by the Trump administration.

As I explained yesterday, the Chinese have been dragging their feet because they really don’t want a trade deal with Trump unless somehow they were able to miraculously get everything that they wanted. They would very much prefer to negotiate with whoever follows Trump in the White House, and they have been using trade negotiations as a delaying tactic to keep Trump from imposing more tariffs on them.

Of course eventually Trump was going to figure out that he was being played, and so now Trump is going to impose new tariffs anyway, and he is hoping that this will be enough leverage to force the Chinese into an agreement.

But there is also the possibility that the entire process could blow up and the Chinese could walk away from negotiations permanently.

And if the Chinese do walk away, it is going to be a disaster for global financial markets.

To me, it seems quite foolish to try to push China around. The Chinese are very, very proud people, and they don’t take threats very well at all. If they feel like they have been disrespected, it is something that they will remember for a very, very long time.

But many in Congress seem to approve of Trump’s approach. In fact, Democrat Chuck Schumer is encouraging Trump to “hang tough on China”

Hang tough on China, President . Don’t back down. Strength is the only way to win with China.

Schumer absolutely hates Trump and would love to see him removed from office, so why the encouraging words?

To me, this smells like a trap. Schumer understands that if negotiations fail it will be a huge blow to the U.S. economy, and if the economy tanks that will be a huge plus for Democrats in 2020.

Over in China, they are officially freaking out over the Trump administration’s latest moves. In fact, an article in the South China Morning Post just compared Trump to Thanos…

The tweets roiled markets in China and Hong Kong, leading one analyst to compare Trump to Thanos – the character from the box office smash Avengers who wiped out half of all life in the universe with a snap of his fingers.

“He snapped his fingers and rattled the market,” said Sheng Liugang, director of the trade and development research programme at the Chinese University of Hong Kong, adding that the move would add to pressure on the Chinese economy, which outperformed expectations in the first quarter of the year, largely due to stimulus measures from Beijing.

We’ll see what happens when U.S. and Chinese officials meet this week.

If the Trump administration is able to strong-arm the Chinese into a deal, Trump will be hailed as a master negotiator and global financial markets will rejoice.

But if a deal is not reached and the Chinese walk away, global financial markets will tank and it could push us into the next economic crisis. According to Warren Buffett, a full-fledged trade war between the United States and China “would be bad for the whole world”…

If we actually have a trade war, it would be bad for the whole world. It could be very bad depending on the extent of it,” Buffett told CNBC.

He added that China and the United States are playing a “dangerous game.”

The stakes are exceedingly high, and the outcome of these negotiations could go either way.

By the end of the week things should be much clearer, and if a deal is not reached we could see events start to spiral out of control pretty rapidly.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Trade talks with China collapse: “This has all the makings of a complete disaster that could lead the stock market to crater this week”

Chaos has returned to global financial markets, and it does not appear that there will be an easy fix this time. For the first four months of 2019, the mainstream media told us over and over again that a great deal of progress was being made on a trade deal with China and that negotiations would soon reach a final conclusion, but now it has become clear that those news reports were fake news. For a variety of reasons, the Chinese have been slow playing negotiations all along. Once they got the Trump administration to suspend the implementation of any new tariffs while negotiations were ongoing, the Chinese no longer had any urgency to reach an agreement. In fact, if the Chinese could have run out the clock all the way to the 2020 election, they surely would have done so. They would very much prefer to negotiate with someone else, and I think that President Trump has finally figured out that he was being played. On Sunday, in a very angry two part tweet Trump announced that he is going to slap China with huge new tariffs

For 10 months, China has been paying Tariffs to the USA of 25% on 50 Billion Dollars of High Tech, and 10% on 200 Billion Dollars of other goods. These payments are partially responsible for our great economic results. The 10% will go up to 25% on Friday. 325 Billions Dollars….

…of additional goods sent to us by China remain untaxed, but will be shortly, at a rate of 25%. The Tariffs paid to the USA have had little impact on product cost, mostly borne by China. The Trade Deal with China continues, but too slowly, as they attempt to renegotiate. No!

In response to Trump’s angry tweets, the Chinese suggested that they may cancel this week’s negotiations

Chinese Vice Premier Liu He had planned to bring a large delegation to Washington on Wednesday to hash out a trade deal — and there’d been talk in recent days that something resembling a deal could result. Instead, two sources briefed on the talks said the Chinese side may back out of this week’s negotiations.

That was pegged to Trump’s new threats, they said, which abandon a six-month truce after Beijing waffled on some previously discussed commitments.

And according to reporter Edward Lawrence, the negotiations have now officially been canceled…

Chinese Vice Premier Liu He has cancelled his trip to Washington this week for trade talks following a tweet by President Donald Trump threatening more tariffs because the talks have moved too slowly.

Needless to say, global financial markets did not respond well to this news. For most of the year, hope that a trade agreement was imminent had lifted stocks, but now that hope appears to be gone.

In Asia, the major Chinese markets were all down more than 5 percent overnight

Asia Pacific stocks tumbled in Monday morning trade following a re-escalation in U.S.-China trade tensions as President Donald Trump declared an impending increase in tariffs rates on $200 billion of Chinese goods.

The mainland Chinese markets plunged in morning trade. The Shanghai composite, Shenzhen composite and Shenzhen component all plunged more than 5% each.

And oil prices immediately began falling as well

Oil prices also saw sharp declines in the morning of Asian trading hours, with U.S. crude futures dropping 2.34% to $60.49 per barrel. For its part, international benchmark Brent crude futures also declined 2.09% to $69.37 per barrel.

Unfortunately, this is likely to be far more than just a temporary setback for the markets. Unless a trade deal can be salvaged somehow, things are likely to get very “interesting” quite rapidly.

According to one top expert quoted by CNBC, this “has all the makings of a complete disaster that could lead the stock market to crater this week and send those external risks to the US economic outlook soaring”…

“Another turn of the screw tighter Sunday from the President’s hard-ball tactics with the China trade talks, and his pair of tweets look like they could unleash a sharp stock market correction,” said Chris Rupkey, chief financial economist at MUFG Union Bank, in a note. “For weeks now markets have been lulled to sleep on the US trade war with China thinking an agreement was imminent. No more.”

“This has all the makings of a complete disaster that could lead the stock market to crater this week and send those external risks to the US economic outlook soaring,” he added.

Could this be one of the triggers that pushes us over the edge and into the economic abyss?

Even without the collapse of trade talks with China, we were definitely heading toward a recession anyway. I really like how economist John Williams made this point during a recent interview with Greg Hunter

“We have a recession in place. It’s just a matter of playing out in some of these other funny numbers. The reality is on the downside, where you have mixed pressures right now. People who are really concerned about the economy right now, and that includes President Trump looking at re-election, he’s been arguing that the Fed should lower rates, and I am with him. The Fed created this circumstance. They are pushing for the economy on the upside because they want to continue to keep raising rates. Banks make more money with higher rates, and they are still trying to liquidate the problems they created when they bailed out the banking system back in 2008.”

The first few months of 2019 have been surprisingly quiet, but now events appear to be accelerating in a major way.

So hold on tight, because it appears that a very bumpy ride is ahead.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Give This Stock Market Bubble A Round Of Applause – The S&P 500 And The Nasdaq Just Hit Brand New Record Highs

Stocks just closed at a brand new all-time record high, ‘Avengers: Endgame’ is coming to theaters, and a 24-year-old man from Wisconsin just won the 768 million dollar Powerball jackpot. If those are the top headlines today, then everything must be good in ‘Murica at the moment, right? Of course that is not true at all, but as far as the stock market is concerned we must give credit where credit is due. Our financial engineers have created the largest stock market bubble in all of U.S. history, and we should all be hoping that it lasts for as long as possible. Because once this financial bubble is destroyed, the aftermath is going to be truly horrible for the entire country.

Up to this point in the year, the stock market is off to the best start that we have seen since 1987.

Of course we all remember what happened toward the end of 1987.

But for now everything is rainbows and unicorns on Wall Street. The following comes from Fox Business

The benchmark S&P 500 index is up 17%, its best start to a year since 1987, while the Nasdaq has gained 22%, its best start since 1991. The Dow Jones Industrial Average remains about half a percentage point from its record last October.

Tuesday’s move to a record high for the benchmark S&P 500 index and the Nasdaq index comes less than six months after a sharp decline in late December, which led the S&P 500 to its worst annual performance since 2008.

Last December, stocks were plunging dramatically, and it looked like a brand new financial crisis was potentially beginning.

But stocks pulled out of their nosedive, and most investors are feeling really happy for the moment.

If we could just freeze this moment in time somehow, we would be in pretty good shape. Unfortunately, time inevitably rolls on, and many believe that there is a lot of pain ahead for investors.

Of course there are other “experts” that believe the best is yet to come. For instance, Kevin Barry just told CNBC that the stock market turmoil that we witnessed late last year “actually prevented a recession”…

“These market levels are justified,” said Kevin Barry, chief investment officer at Captrust Advisors. “The fourth-quarter sell-off actually prevented a recession because policymakers responded extremely quickly. Both President Xi and President Trump cooled off the rhetoric and Fed Chairman Jerome Powell came out and reversed course.”

I have read that paragraph over and over, and I still can’t believe that someone actually had the gall to say such a thing.

According to Barry, the coming recession has been postponed indefinitely and everybody can start partying like its 1999 all over again!

If only life were so simple.

Look, the reality is that even Fox Business is admitting that stock buybacks are one of the major factors driving this latest rally…

However, the rally this year has been despite outflows from equity funds, according to Bank of America data, suggesting some of the gains have been driven by corporate buybacks of stocks.

Our largest corporations are going hundreds of billions of dollars in debt to pump up their own stock prices. It is a Ponzi scheme of epic proportions, and when things start to go bad there is going to be a race to bankruptcy court.

But for the moment the Ponzi scheme continues, and a lot of people are becoming exceedingly wealthy as a result.

For average Americans, it is absolutely imperative to remember that the stock market is not the economy. Yes, the stock market has been soaring, but the U.S. economy has not had a full year of 3 percent growth since the middle of the Bush administration. This has been the longest stretch of sub-three percent economic growth in our history by a very wide margin, and now all of the numbers are telling us that economic activity is slowing down once again.

Instead of partying, most people should be using this time to prepare for what is ahead, but we know that is simply not going to happen.

And when the end of this bubble finally comes, it is likely to come very quickly. As I always stress to my regular readers, markets tend to go down a whole lot faster than they go up, and that is especially true during times of crisis.

In 2008, enormous amounts of money were lost in the blink of an eye. The following comes from an outstanding article by Bob Henderson entitled “What I Learned From Losing $200 Million”

The day after Lehman fell I lost $20 million, and the day after that $30 million—enough in two days to wipe out all the profits I’d made the previous year. (And that had been a pretty good year.)

But worse was that I felt trapped. My models showed I was destined to lose far more money in the coming weeks, no matter what I did. All roads seemed to lead to an unavoidable abyss. I could practically feel that hot hole breathing under my desk. I actually got dizzy, and lost my ability to think. When my boss stopped by to warn me that Goldman Sachs and Morgan Stanley looked likely to fall next, he seemed almost amused when he told me that I looked green.

I stumbled home early that day, mentally incapacitated for the first time in my career.

Someday we will see similar things happen again, but we should all want that day to be put off for as long as possible.

For the moment, happy times are here again on Wall Street, and we should enjoy them while we still can.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Wall Street Red Flag: A Bond Market Indicator That Has Predicted Every Recession In The Last 50 Years Just Got Triggered

If the bond market is correct, the U.S. economy is definitely heading into a recession. Over the past 50 years, there have been six previous occasions when the yield on three-month Treasury bonds has risen above the yield on ten-year Treasury bonds, and in each of those instances a recession has followed. Now it has happened again, and this comes at a time when a whole host of other economic indicators are screaming that a recession is coming. Of course we have seen recession indicators triggered at other times in recent years, and the Federal Reserve was able to intervene and successfully extend this cycle on multiple occasions. But now that the global economy is clearly the weakest it has been since the last recession, have we finally reached a breaking point?

Many on Wall Street are taking what happened at the end of last week extremely seriously. According to CNBC, we have not seen a yield curve inversion of this nature in 3,009 trading days…

Short-term government fixed income yields are now ahead of the longer part of the curve, delivering a strong recession indication that hasn’t happened since 2007.

The spread, or yield curve, between the 3-month and 10-year Treasury notes just broke the longest streak ever of being above 10 basis points, or 0.1 percentage point. The two maturities were last below that level in September 2007, a run of 3,009 trading days, according to Bespoke Investment Group.

3,009 trading days is a very, very long time.

And now we will see how inverted the curve becomes, because as Zero Hedge has aptly pointed out, the more inverted the curve become the “higher the odds of a recession”…

Why is the inversion of the 3 Month-10 Year curve – the first since 2007 – such a momentous occasion? Because not only is said inversion the most accurate recession leading indicator, having correctly “predicted” the last 6 recessions with no false positives, most recently inverting in 1989, in 2000 and in 2006, with recessions prompting starting in 1990, 2001 and 2008….

… it also feeds directly into every Wall Street recession model: the more inverted it is, the higher the odds of a recession.

To get an idea of what the models are currently showing, just check out this chart. At this moment, the odds of another recession are the highest they have been since the last one.

Many investors were hoping that the bond market would have better news for us on Monday, but instead things got even worse

On Friday, markets were spooked when the yield curve inverted, a reliable recession signal though usually not an immediate one. That means the rate on a lower duration instrument rose above a longer duration security’s yield. In this case, it was the yield on the 3-month bill, at 2.44 percent Monday, moving above the 10-year yield, which sank as low as 2.38 percent, a more than 2-year low.

I know that just about everybody in America is writing about the Mueller Report right now, and I just posted an article about it too, but the outcome of that investigation is not going to change the trajectory of the global economy. It has been slowing down for quite some time, and that is the primary reason why we have seen an inversion of the yield curve

“Yield curves are responding to what they see, to what I believe is a global economic slowdown,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group. “You don’t see this kind of move in curves, not just here but everywhere, unless you get one.”

Global central banks are already jumping into action, and I expect a tremendous amount of intervention as global economic conditions continue to deteriorate.

But there is only so much that they can do, and even though they have pulled a few rabbits out of the hat in recent years, at some point they are going to completely lose control.

Already, we are starting to see things happen that are very reminiscent of the last recession. For example, we are on pace for the worst year for store closings in all of U.S. history, and another major retailer just announced that they will be closing all their stores

LifeWay Christian Resources announced Wednesday that it will be closing all remaining 170 stores this year and focusing on online sales. Carol Pipes, director of corporate communications for LifeWay, posted the announcement on the company’s website, explaining that it was “a strategic shift of resources to a dynamic digital strategy.”

Communities all over America, especially the more economically-depressed ones, are going to start looking really bleak as the number of empty buildings continues to rise. This is something that I have warned about for a long time, and now it is happening on a massive scale.

As I end this article, I once again want to mention a factor that is going to have an enormous impact on our economy throughout the rest of this year. The flooding in the middle portion of the nation has destroyed thousands of farms, and the National Weather Service is warning that the flooding that we have seen so far is just “a preview of what we expect throughout the rest of the spring”. This is already the worst flooding disaster for U.S. farmers in modern American history, and it is going to get much, much worse.

We are going to see another huge surge in farm bankruptcies, thousands of farmers will not be able to plant crops at all this year, food prices are going to rise dramatically, and a lot of families all over America are going to have a real problem making their food budgets stretch far enough.

There are so many factors hammering our economy right now. If the Federal Reserve is able to pull another rabbit out of the hat this time, it will be nothing short of a major miracle.

We are literally at a critical tipping point, and it is not going to be easy to pull us back from the brink this time.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

Investors Brace For Impact As The Cancer That Is Ravaging “The Real Economy” Starts To Spread

2019 sure has been a weird year so far. On Wall Street, everything has been coming up roses for investors up to this point. Stock prices have risen more than 10 percent year-to-date, and the horrible crashes of late last year are quickly fading from memory. Meanwhile, the real economy is literally falling to pieces right in front of our eyes. Debt delinquencies are at unprecedented levels, bankruptcies are soaring, retail stores are closing at a record pace, this is the worst economy for farmers since the early 1980s, exports are plummeting and a brand new real estate crisis has now begun. Economic cancer is rapidly spreading throughout our country, and the U.S. economy is deteriorating at the fastest pace that we have seen since the last recession. So how long will it be before Wall Street catches up with economic reality?

The retail industry is being hit particularly hard. At the end of last week, major retailers announced 465 store closings in a single 48 hour period…

The ‘retail apocalypse’ is alive and well this week with major chains such as Gap, JCPenney, Victoria’s Secret and Foot Locker all announcing massive closures, totalling the death of more than 465 stores over the last 48 hours.

And those closings already bring the grand total for 2019 to “a whopping 4,309 store closures”

That builds on recent store closure announcements by Gymboree, Payless ShoeSource, Charlotte Russe and Ann Taylor parent company Ascena Retail, to name a few. A whopping 4,309 store closures were announced by retailers just in the first two months of this year, Coresight Research said in a research note on Friday. That’s well ahead of the number of announcements the market research firm was tracking this same time a year ago, it said.

The term “retail apocalypse” is being thrown around so frequently these days that it has almost lost its meaning, but the worst is yet to come.

Meanwhile, layoffs are starting to come fast and furious now. For example, I was recently made aware of major job cuts that just happened in North Carolina

Duke Energy Corp. eliminated 1,900 positions in its latest round of job reductions, largely through voluntary buyouts but with some involuntary layoffs included.

For the first time since the last recession, I think that it is time to start visiting sites like Daily Job Cuts on a regular basis once again. Millions of Americans lost their jobs in 2008 and 2009, and a lot of you can still remember how painful that was.

In the middle of the country, the big news is “the farm apocalypse”. Last week, we learned that farm debt has now jumped 30 percent since 2013…

“Farm debt has been rising more rapidly over the last five years, increasing by 30% since 2013 – up from $315 billion to $409 billion, according to USDA data, and up from $385 billion in just the last year – to levels seen in the 1980s,” Perdue said in his testimony to the House Agriculture Committee.

As a result of this giant mountain of debt, a ton of small and mid-size farms are going under. As I noted the other day, farm debt delinquencies have now reached the highest level that we have witnessed in 9 years.

I really, really don’t understand the people that are telling us that everything is going to be okay.

Everything is not okay, and things are getting worse with each passing day. ISM’s manufacturing survey just hit the lowest level in 26 months, and for a whole bunch more extremely ominous economic numbers please see my previous article entitled “18 Really Big Numbers That Show That The U.S. Economy Is Starting To Fall Apart Very Rapidly”.

Of course it isn’t just the U.S. that is hurting. Up north, Canada is literally teetering on the brink of recession

The Canadian government shocked the professional financial and economic media with their latest fourth quarter GDP release showing the economy has essentially come to a grinding halt at 0.1% growth.

And over in Europe, things are arguably even worse. Germany is supposed to have the strongest economy in the entire region, but they are also right on the brink of recession

The country’s economy just escaped entering recession territory last month, with GDP growing at just zero percent following a 0.4 percent contraction in the previous three-month period. But Germany could be just weeks away from a recession-threatening double whammy as a potential no-deal Brexit and Donald Trump’s warning to hike car tariffs by up to 25 percent could send the economy tumbling. Chancellor Angela Merkel’s ministers have entered into a frantic plan to avert an economic catastrophe which could end Europe’s biggest economy’s golden growth for a decade.

This is a global economic slowdown, and many believe that it will be even worse than what we experienced in 2008.

But as I have previously warned, we aren’t just heading toward an economic storm. Everything that can be shaken will be shaken, and that includes our governmental institutions.

On Sunday, we learned that the House Judiciary Committee is opening an investigation into obstruction of justice by President Trump. The following comes from Reuters

The House Judiciary Committee will seek documents from more than 60 people and organizations as it begins investigations into possible obstruction of justice and abuse of power by President Donald Trump, the panel’s chairman said on Sunday.

Committee Chairman Jerrold Nadler told ABC’s “This Week” the panel wanted documents from the Department of Justice, the president’s son Donald Trump Jr. and Trump Organization chief financial officer Allen Weisselberg, among others.

This is going to be a year of great governmental shaking. And no matter which side emerges victorious from the legal struggles and from the election of 2020, the truth is that our governmental institutions will never be the same again.

From 2016 through 2018, America experienced a time of relative peace and prosperity, and a lot of people out there were convinced that this bubble of unsustainable false prosperity could continue indefinitely.

Now it is becoming very clear what is ahead of us, and a lot of people are starting to freak out.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

18 Really Big Numbers That Show That The U.S. Economy Is Starting To Fall Apart Very Rapidly

Virtually every piece of hard economic data is telling us that the U.S. economy is slowing down dramatically. Many of the pundits have been warning that we could officially enter recession territory later this year or next year, but these numbers seem to indicate that it could happen a whole lot sooner than that. But the stock market has been surging over the last two months, and at this point stocks are off to their best start to a year since 1987, and as long as stock prices are rising a lot of people are simply not going to pay much attention to the economic alarm bells that are ringing. But everyone should be paying attention, because things are really starting to get bad out there. The following are 18 really big numbers that show that the U.S. economy is starting to fall apart very rapidly…

#1 Farm loan delinquencies just hit the highest level that we have seen in 9 years.

#2 We just learned that U.S. exports declined by 4 billion dollars during the month of December.

#3 J.C. Penney just announced that they will be closing another 24 stores.

#4 Victoria’s Secret has just announced plans to close 53 stores.

#5 On Thursday, Gap announced that it will be closing 230 stores over the next two years.

#6 Payless ShoeSource has declared bankruptcy and is closing all 2,100 stores.

#7 Tesla is also closing all of their physical sales locations and will now only sell vehicles online.

#8 PepsiCo has started laying off workers and has committed to “millions of dollars in severance pay”.

#9 The Baltic Dry Index has dropped to the lowest level in more than two years.

#10 This is the worst slump for core U.S. factory orders in three years.

#11 We just witnessed the largest decline in the Philly Fed Business Index in more than 7 years.

#12 In January, sales of existing homes fell 8.9 percent from a year earlier. That was the third month in a row that we have seen a decline of at least 8 percent. This is an absolutely catastrophic trend for the real estate industry.

#13 U.S. housing starts were down 11.2 percent in December compared to the previous month.

#14 Compared to a year earlier, home sales in southern California were down 17 percent in January.

#15 In December, home sales in Sacramento County fell a whopping 22.5 percent compared to a year earlier.

#16 Pending home sales in the United States have now fallen on a year over year basis for 13 months in a row.

#17 More than 166 billion dollars in student loan debt is now “seriously delinquent”. That is an all-time record.

#18 More than 7 million Americans are behind on their auto loan payments. That is also a new all-time record, and it is far higher than anything that we witnessed during the last recession.

It appears that “the recovery” has finally come to an end. After seeing all of those numbers, there is no way that anyone can possibly claim that economic conditions are “getting better”.

And even though the official government numbers are highly manipulated, we never even had one “boom year” throughout the entire “recovery”.

The final numbers for 2018 are now in, and last year was the 13th year in a row when U.S. GDP growth was below 3 percent.

The last time we had a “boom year” when economic growth was above 3 percent was all the way back in 2005. That was in the middle of the Bush administration.

We have never seen a bad streak like this before in modern American history. The following comes from CNS News

But prior to the current 13-year period when real GDP has failed to grow by 3.0 percent in any year, there has been no stretch (in the years since 1930) when the United States went as long as five straight years with real GDP failing to grow by at least 3 percent.

Even though the Federal Reserve pumped trillions of dollars into the financial system over the last decade, and even though we added nearly 12 trillion dollars to the national debt, the best that the authorities have been able to do is to stabilize the system for a while. Now it is starting to sputter once again, and many believe that the next crisis will be far worse than the last one.

By contrast, the Great Depression of the 1930s featured some really bad years, but following those bad years the U.S. experienced a tremendous economic boom

By contrast, after the stock market crash in 1929, the United States saw four years of negative annual GDP—1930 (-8.5), 1931 (-6.4), 1932 (-12.9) and 1933 (-1.2). But then in the nine full years from 1934 through 1942, real GDP grew by an average of 9.75 percent.

We should have had some boom years too, but we didn’t, and now things are going to get bad again.

The Democrats are going to blame the Republicans and the Republicans are going to blame the Democrats, but all of that arguing isn’t going to solve anything.

What is coming next has been a central focus of my work for a very long time. The last recession was very painful, but it did not fundamentally alter life in America.

This next crisis will.

The “Everything Bubble” is bursting, the “Perfect Storm” is coming, and all of our lives will never be the same again.

But that doesn’t mean that there isn’t hope. In fact, once things really start getting crazy hope is going to be one of the major themes in my work because people are really going to need it.

There will be great challenges, and life will be very different, but that doesn’t mean that life is over.

America is about to experience the consequences of decades of exceedingly foolish decisions, and the pain will be extreme. But difficult times also offer an opportunity for dramatic change, and that is something that we will need to embrace.

Get Prepared NowAbout the author: Michael Snyder is a nationally-syndicated writer, media personality and political activist. He is the author of four books including Get Prepared Now, The Beginning Of The End and Living A Life That Really Matters. His articles are originally published on The Economic Collapse Blog, End Of The American Dream and The Most Important News. From there, his articles are republished on dozens of other prominent websites. If you would like to republish his articles, please feel free to do so. The more people that see this information the better, and we need to wake more people up while there is still time.

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