As Usual Main Stream Media is Only About Two Years Behind

This Sums It Up!Reuters just published an article called, More U.S. Cities Set to Enter Default Zone when I saw it all I could this was well duh, is this really a surprise to anyone, sadly it is.   From the article,

“But the next series of major cities and counties in danger of defaulting on their debt can hardly point to one single decision for their malaise. Whether it be Detroit, Miami or Providence, Rhode Island, their problems have a lot more to do with financial policies that put them on course to live well beyond their means.”

When I read stuff like this the sarcasm just pours out of me, I just want to shout “really?  really? you are telling me that government borrows money to pay for what it can’t afford and eventually the bill comes due.”  The real news here of course isn’t that cities are going broke along with counties and that states are not behind them.  If you read TRTAM and listen to The Survival Podcast you have been hearing that for two years now.  To me we are starting to entering the “point of acceleration” I have been worried about for so long.

You see what you are looking at right now is a pattern that the main stream media has repeated over and over.  Leading up to an event they will permit a few contrarians who speak the truth to come on once in a while, in this case the best example is Meredith Whitney who has been speaking about the coming defaults for even longer than I have.  In fact I must credit Meredith with being one of my main sources to uncovering this coming financial disaster.

Of course the news channels then bring out three or four so called “expert” talking heads to mock the one person who is speaking the truth.  Down the road the problem becomes more evident and while never apologizing or acknowledging the accuracy of the contrarian they begin to cover the issue while still down playing the real problem.  Not long after that the problem becomes something we hear about over and over and everyone blames everyone else and “we the people” deal with the suffering.

So to me it is important that we watch coverage of this issue closely, trust me the more main stream coverage it gets the closer we are to the point where the problem comes to its unavoidable conclusion as a raging economic storm.  When it does the politicians will showboat and blame but have no solutions.  Everyone will act shocked and tell us something completely stupid like, “no one could have seen this coming”.  In summary, there is a major global recession on the way and the municipal bond defaults that are coming may very well be the catalyst that sets it off.   One thing we can say for sure is, it certainly isn’t going to help anything.

The last line of the Reuters article says it all, “At an industry conference last month in Philadelphia, Richman said, “A lot of the easy fixes are gone.”

Indeed they are, in fact I would put it more accurately and simply state, there are no longer any easy fixes.  Austerity at the State, Country and City level is on the way and likely Federal level austerity isn’t far behind.  This is not time to let a smile be your umbrella, if you do expect that soon your ass will be soaking wet.

When Faced with the Truth the Mayor of Providence Fires the Man Who Speaks It

Telling Mayor Angel Taveras the Truth Might Get You Fired

Telling Mayor Angel Taveras the Truth Might Get You Fired

For years and years I have warned that one of the true dangers to our economic future is the fact that many cities, counties and states in America are sitting on the verge of bankruptcy.  Unlike the Federal Government cities and counties can’t “print money”, all they can do is tax and borrow to raise money.  The way they borrow is via selling bonds, these are called “municipal bonds”.   A text book explanation of a municipal bond would be,

A municipal bond is a bond issued by an American city or other local government, or their agencies for the purpose of financing the infrastructure needs of the issuing municipality. These needs vary greatly but can include schools, streets and highways, bridges, hospitals, public housing, sewer and water systems, power utilities, and various public projects.

However a more accurate way to describe a municipal bond would be - A way for a government body to borrow money in order to pay for things it can not afford so the people today can have something their children will be forced to pay for with interest added on tomorrow.  Currently there are billions upon billions of dollars in debt issued as this type of bond and many of them are propping up cities, counties or states that would have been bankrupted long ago with out them.  The problem is this is exactly like using your MasterCard to pay the Visa people, it can only go on for so long.

Currently Providence Rhode Island is sitting on the verge of bankruptcy, in fact an honest man by the name of Robert Flanders said recently that not only was bankruptcy likely for Providence but I don’t see how they can get out of it without going there.  Such honesty is rare but more rare would have been for such honesty to be rewarded, in this case it certainly wasn’t.

What the Mayor did was fire Mr. Flanders and his firm saying that, his comment was “unacceptable”.  The mayor hasn’t claimed that the city isn’t going bankrupt, simply that saying it is again, “unacceptable”.    He also said, “Providence is not Central Falls,”  along with, “We’ve already accomplished much in our work to put Providence back on firm financial ground.” Notice he doesn’t say, the city won’t go into bankruptcy?  Why?  Because the city is teetering on it right now and likely will at some point.

The key thing to take away from this is that this isn’t really about Mr. Flanders, Mayor Taveras or even Rhode Island.  No what you see here is the reality that all these cities are trying to hide and how they go about doing so.  They simply say that any talk of bankruptcy is nonsense and unacceptable right up until they end up in bankruptcy and at that point they blame someone else.  The key is they are all hiding the reality that money has been borrowed that many cities and counties will never be able to pay back or that obligations have been made in the form of pensions and entitlements that can never be met.

In short when faced with the truth they lie and continue on with business as usual and hope no one pays attention.  Keep this in mind and please have a plan for an eventual economic day of reckoning.  Between the Federal Debt, the reality that Medicare, Medicaid and Social Security are underfunded by over 100 trillion dollars in future obligations, the fact that the interest on the national debt alone is now our 4th largest expense and over 100 cities are in danger of bankruptcy can lead any honest person to one conclusion.   Some day soon the bills will come due and the people that caused the problem will be long gone by then leaving you and your children holding the bag.  We only need to look to Argentina and Greece to see where that road leads.

 

The Robbery of The American People Explained with Pennies

Today a person that listens to my daily online radio show, The Survival Podcast turned me onto the video below.  Frankly I think this may be one of the most important things for people to see to truly understand just how badly the nation has been pilfered and lied to over the last few years of economic recession.  They say a picture is worth a thousand words, well this video may be worth 16 Trillion words.

If you feel nauseous when you see the second round of pennies falling wait until the big reveal at the end of the video.  The Video is called “The 100 Million Dollar Penny”.  I have seen others use pennies before to illustrate big monetary values but nothing with this much impact and horrifying truth before.  You want the “real truth about money” as it pertains to the real “bail outs”, well friends wait until you see this one!

How Big Would a Collapse of Several US States be Based on Global Economic Realities

See the Full Interactive Map at TheEconomist.com

See the Full Interactive Map at TheEconomist.com

So I am sure you’ve heard that if Italy fails under its current debt crisis that it could be a huge problem for the entire world right?  Further with the current situations in Italy and Greece combined we could have a real mess on our hands that could have global implications.  Now I am not saying anything about the above isn’t true, but how bad do you think it would be if say the states of California and Washington collapsed in a debt crisis?

Here is a shock, according to a new resource provided by The Economist numbers wise it would be about the same as Greece and Italy going under.

The GSP (gross state product) of Washington State is about the same as the GDP (gross domestic product) of Italy, the same comparison can be made between California and Italy.  This is why I am so concerned about a domestic crisis in the municipal bond market.  Some other shocking comparisons.

  • The state of Texas is roughly equivalent to the nation of Russia
  • The state of New York is roughly equivalent to the nation of Australia
  • The state of New Jersey is roughly equivalent to the nation of Switzerland

This begs the obvious question, if the nations of Italy, Greece, Russia, Australia and Switzerland all fell at the same time how bad would it be for us and for the world as a whole?  While we can’t make a direct comparison in many ways the same crisis could be caused by just 5 US states.

All in all “The Economist” was able to create an interactive map that accurately correlated 50 different nations to each of our 50 states.  In short a US collapse would be equivalent to 50 different nations going down at once.  Again it isn’t a direct 1 for 1 comparison but it should give us pause when the talking heads on TV tell us there is nothing to worry about from a stand point of state, city and county municipal bond based debt.

You can find the map and get a better perspective of this situation on The Economist website at this link.

Creating True Wealth™ in 2012

No one can deny that the economic climate in the U.S. and the world has been in a decline for a while now.  The problem has been around long before the most recent “crisis” in the housing and banking systems.  It’s basically a two-fold problem: debt backed currency, and a lack of true value.  The first problem is not one that individuals can really do much about on a grand scale.  The second problem is one everyone can do something about even if it’s in a small way.

Many jobs end up being nothing more than pushing paper or shuffling goods.  Now I don’t mean to put anyone down at all.  What I am saying is that when the majority of the population is employed in jobs such as a retail clerk selling goods from China and other countries to fellow citizens also employed in similar positions, we start to have a problem.  Less and less is being produced and more and more being consumed.  How long can we sustain sitting in cubicles answering phones for insurance companies or selling products from other countries or just shuffling papers in an office as a means of “production?”

At the end of the day, we all have to eat, sleep in a bed, take showers, and wear clothes.  All these things relate to physical goods. Even information products are items that can be sold and add value. Services are a one off.  While services are necessary I believe that the economy has shifted to an imbalance of services versus products. Colleges seem to be breeding this to the extreme with most college positions being for services or management.  Youth unemployment shows this as it is surging and has been for the past few years. Check out this article on Global Youth Unemployment. One of the best articles I have read on the subject of youth unemployment can be found here.

As time progresses everyone, especially the youth will have to create true wealth. We will have to be the ones creating the jobs and starting businesses.  No one is going to do it for us.  Create the wealth for yourself in a sustainable manner and you will be in a much better place.  Consequently it will enable you to help others even more.

All true wealth comes from the ground in one form or another. The oldest wealthy were the land owners because of the crops that could be grown on it and the buildings that could be built on it.

So what exactly are some ways to create True Wealth™?

#1.  Grow a garden.  Even if you’re in an apartment I’d bet you could find a way to grow a little food on your patio in pots and perhaps raised beds.  Having the ability to produce your own food is a type of true wealth.  If you have more than just a few pots, all the better.  There are great resources all over the internet including on my site on how to create raised bed gardens.

#2. Provide some percentage of your own energy needs.  A great way to do that would be to install a small amount of solar panels over time if you can afford it.  If you take this rout make sure you get an inverter that can handle scaling up.  If you put a couple panels on each year, you can spread the investment out over time and still provide some of your own energy needs.  Another way to provide energy needs would be to harvest your own firewood where it is legally permitted.  Season it properly and use it in your fireplace or barbecue.

#3. Create a business or a product.  Creating a business is becoming more and more necessary as jobs (and true wealth creating jobs) decline.  If you can find a way to make your business or product generate even more true wealth for your clients, then it can truly impact them. Creating a product can be anything from something you make from other resources, to an instructional ebook or DVD on how to do something that would be useful to someone.

#4. Look into investing in land and precious metals.  Again, wealth comes from the ground.  The thing about land is you can’t print more of it, therefore it will always be valuable. Sometimes you can find great deals on land if you look for it.  It would be wise to look for land that could produce food or set up in some other way to generate income.

#5. Build social capital.  No matter how good or how wealthy you are, you can’t do it alone nor, would you want to.  Building your social network (in real life and online) can help you because you can’t do it all.  People have connections, resources, talents.  Beyond that they can just simply be your friends.

Question:

What are some other ways to build true wealth in 2012?

About the author: Jake Reed is programmer and creator of Survivalize.com and Unreasonablog.com which are sites dedicated to helping you consistently live a better life in every area.

The Video Every Member of Occupy Wall Street Needs to Watch (about 50 times)

I have been taking a lot of heat for not supporting the Occupy Wall Street movement.  My reason has been that I feel the average protestor has no idea what they are actually protesting and that they will be used a pawns and to incite riots when the elites will step in with a “solution” that will actually make the problem worse.  This is how I see it and I see it this way due to a few things…

  1. A lack of the ability of most of the protesters to articulate exactly what they want
  2. A lack of knowledge as to how the system they are protesting works
  3. The driving force behind them is simply anger because some people have more than they do

These three factors combine to create a volatile group which can be steered by guess who?

  1. People who will tell them what they want in a way that sounds good to them
  2. People that don’t just know the system they run the system
  3. People who excel at channeling their anger and blaming the working class and calling them rich

David Icke is the guy in this video, he is actually totally behind the Occupy protesters unlike me, yet his warning to them is exactly the same as mine.   Please listen to this video fully, if you really want to understand the direction things are going.  If you know people in the movement make sure they see this video, and I would do that absent of my comments here so that they will be receptive.  Again Icke is rooting for the protesters fully but please fully understand his dire warning here.

Jefferson County Alabama – Bankruptcy or Bailout?

Jefferson County has 3.2 Billion in Debt from Bonds that Funded a Sewer Upgrade.

In general I like to be right, it makes me feel good when I predict something and it comes to pass, however, the current nightmare I am watching become real is not one of those times.   Since 2009 I have been predicting a collapse of city, county and state governments.  I have also said the cities would look to the counties for a bail out and the counties to the states.  That such madness would continue until the states were forced to beg the federal government for a bail out and in the end the currency as we know it would collapse.

So far I have reported on cities like Pontiac MI, Harrisburg, PA and Central Falls, RI all on the edge of going over the bankruptcy cliff.  Well today I bring you news of the largest municipality so far to hit the wall hard enough to say the “B word” publicly.

The Huffington Post reported 4 days ago that Jefferson County Alabama has an 80% chance of going into bankruptcy.

According to the Huffington Post…

Alabama’s troubled Jefferson County faces an 80 percent chance of declaring bankruptcy, one of its commissioners said on Thursday, as U.S. experts gathered to discuss the implications of a possible Chapter 9 filing.

Another commissioner said the county has yet to hear a response from creditors over its proposal that $1.3 billion be shaved off its crippling $3.2 billion sewer bond debt as part of a settlement to avoid what would be the largest municipal bankruptcy in U.S. history.

Read the Full Article on The Huffington Post

Notice the final phrase?  “The largest municipal bankruptcy in U.S. history.“  Sadly it will pale in comparison to many future incidents but we really need to take this in.  This isn’t a tiny hamlet like Central Falls, it is the worst municipal failure to come to head in our nation’s history.  In fact Jefferson County is the most populous county in the state of Alabama and its county seat is Birmingham.  To put this in perspective Birmingham is the 97th largest city in the US.

To me though the big story isn’t that a county is about to file Chapter 9.  The bigger story is a bailout from the State of Alabama already seems to be on the way.   The Wall Street Journal now reports that the State of Alabama is seeking to help Jefferson County avoid bankruptcy.

According to the WSJ…

While it isn’t willing to offer a “cash bailout” to Jefferson County, the state is open to providing a type of “credit enhancement” that would make a deal between the county and its sewer creditors “more palatable,” Alabama Finance Director David Perry said in an interview.

That “credit enhancement” could involve making Jefferson County’s sewer system an independent entity apart from the county, which Mr. Perry said could help lower the rate that would have to be paid when billions of dollars in sewer debt are eventually refinanced. Such a move would require the passage of state legislation, he said.

“We’re willing to do whatever it takes” for the county to avoid filing bankruptcy, Mr. Perry said. But he warned, without elaborating, that Gov. Robert Bentley “wouldn’t do anything that’s not in the best interests of both the county and the state.” Mr. Bentley, a Republican, previously said he’d support a bankruptcy filing by Jefferson County if its officials chose that course of action.

Read the Full Article at WSJ.com

So the state is coming to the rescue but they are being clear that there will be no “cash bailout”.  Well, sort of, please pay close attention to where Mr. Perry states, “We’re willing to do whatever it takes”  so I would like to ask Mr. Perry what if it ends up taking a cash infusion?

The real story is simple, just as I stated as the cities and counties begin to implode the states step in and try to fix the problems.  The issue though is this isn’t just about a 3.2 billion dollar sewer bond, the county clearly has been spending money it doesn’t have this is just the particular bill they can’t pay.  For instance if a family can’t pay the MasterCard bill it isn’t unrelated to the Visa bill, the jumbo mortgage, the 3 car payments, etc.    So whether Jefferson County gets a “credit enhancement” or “cash bailout” doesn’t really matter, the net result will be reckless spending with no consequence.  Of course this will result in postponing not avoiding a bankrupt county.

Alabama is also doing exactly as I predicted!  They have set the stage for every failing city and county to line up and ask for help.  This of course can only go on for so long.  Other states of course will chart the same course as a similar comedy of errors occurs within their own borders.

The big question I have for you is do you realize why?  This is all to preserve the ability to acquire more debt!  The State of Alabama really doesn’t give a damn about county workers and retirees.  No they want to make sure that they can continue to borrow and spend beyond their means. They don’t want to have to pay higher interest rates on their own bonds.  So funding government by credit card is basically now a status quo to be maintained at all costs.

The reason I am predicting an eventual call from 25 or more of the states to the federal government for a bail out is simple.  With behavior like this, no other result is possible.  When, not if, but when it happens the only way out is a massive inflationary spike to devalue debt by devaluation of the currency.  My belief is at that point the conventional policy of printing money will be insufficient to solve the problem.  The solution will be to rebase the currency and trust me it won’t be pretty when that happens.

Fire Up The Presses for QEIII

Photo Credit to Gage Skidmore via Flickr

Back on June 23rd I reported that for the first time Ben Bernanke and I were in agreement.

At that time the good chairman had decided it was time to stop printing money, better known as quantitative easing.

If you are not exactly clear on what quantitative easing is, this simple video will explain it and both a humorous and depressing way.

The key thing though is that less than a month ago, The Federal Reserve Chairman said three things of great importance…

  • Two rounds of quantitative easing didn’t work
  • It was time to stop doing it
  • He was confused as to why it didn’t work

At this point anyone with a pulse should have drawn two conclusions

  • Bernanke is a disaster, the man who holds the nation’s credit card is confused as to why blowing 5 trillion of our dollars didn’t work.  -  Hell listen to Ron Paul eat his lunch in this video.
  • As he didn’t get why it didn’t work he was probably lying when he said it was time to stop.  The fact that he was confused should have told you he still believed that printing money was the solution and eventually he would decide that they simply didn’t do enough of it.

Of course in my first article on this subject I stated clearly, “I predict QE3 will happen down the road”, but even I am shocked here.  Bernanke how now executed an about face that would make a Marine envious with its speed and relative quickness on such an important issue.  It only took 20 days to go from, “it didn’t work, it is time to stop and I am not sure why it didn’t work” to “it may time to start doing it again because we have to get the economy going”.  Yes old helicopter Ben is at it again according to a report on CNBC old Ben now has told congress he is working on a some new ways to stimulate the economy, how you ask, from the article on CNBC…

Minutes to the central bank’s June meeting on Tuesday suggested that, while some members were pondering the possible need for additional easing amid a weak economy, the Fed is not yet ready to take any further action.

But the minutes also reflected divisions within the central bank over further easing, and Bernanke’s speech provided a further indicator that a QE3 move is far from off the table.

“Even with the federal funds rate close to zero, we have a number of ways in which we could act to ease financial conditions further,” Bernanke said.

Let me give you the nuts and bolts, Jack Spirko version of this, we have a number of ways in which we could act to ease financial conditions further” means simply, if the economy stays in the crapper for much longer we will start buying up bonds again with computer entries, gobbling up toxic assets at tax payer expense and flood the markets with money because it is the only thing we can do.

Indeed it will be the only thing they can do as city after city continues to declare bankruptcy and run to the states for bailouts.  They may talk of raising interest rates but that is the only thing you say when the interest rate is basically zero.  Yet raising rates is not really an option.  Do that and the duct tape holding the false recovery together flies apart.

Central Falls RI, Yet Another City on the Edge of Bankruptcy

Photo Credit to Purpleslog via Flickr

Two years ago I began warning listeners of The Survival Podcast that round two of the current crisis would begin with a series of city level defaults, followed by state defaults.  This would eventually cause run away inflation as the federal government attempted the impossible task of fixing the mess with the end result being a re-basing of the currency.  In short money printing has its’ limits, the coming defaults by hundreds of cities and dozens of states will be what pushes us to said limit.

Over the past year at TRTAM, I have continued to sound this alarm.  In response I have been called a loon, an alarmist and a quack.  In spite of being called those names I am beginning to wish I was nuts and the naysayers were right.  Unfortunately this catastrophe is unfolding right in front of us and just about as on schedule as it could be.  Right down to me calling the Dow at 12,500 as part of the false recovery by mid 2011, it currently sits at 12,601 as I type this.

Just two days ago Boston.com reported that Central Falls Rhode Island is now standing on the “edge of financial abyss.”  Here is a excerpt from the article on Boston.com

Central Falls, one of New England’s most distressed cities, is on the cusp of filing for bankruptcy protection – a relatively rare step for municipalities even in tough financial times. Since 1980, only about 46 cities or towns in the United States have sought such protection, according to James Spiotto, an attorney in Chicago who is an expert in municipal bankruptcies.

Last year, the state took over Central Falls – a city of 19,000 residents with an unadjusted unemployment rate of 15 percent – stripping the mayor of his keys to City Hall and the rest of his authority. That move came after every teacher was fired at the under performing high school, with most of them rehired later.

Here we see a very predictable and all to familiar drama playing out yet again.

  1. The city over spends, over commits to workers and funds shortfalls with bonds (borrowing money)
  2. Borrowing money is a temporary solution to a permanent problem in the end it makes the problem worse
  3. The city goes into receivership and the receiver and state force some cost cutting, generally some of it is political theater like canning the mayor or elimination of city council salaries.  Salaries that are not even a drop in the bucket vs. the overall problem.
  4. There is no cost cutting that can fix the issue and even the places they do cut they end up spending the money in some future stupid decision, here for instance rehiring the teachers who were under-performing.  Please consider there is a cost when you “hire” and a cost when you “fire”, to fire someone and rehire them is expensive.
  5. Eventually the city goes to the state and says “fix it” or “we want bankruptcy protection” and if you don’t bail us out we will default on our bonds and that will screw you over too.
  6. The state then must either let the city die or try to bail them out.  Of course both choices suck and bailing out the city simply sets the stage for more failing cities to get in line.

So what’s next in this unfolding chain of misery?  Just like the bank failures in 2008, we will be told not to worry and that everything is just fine until the numbers exceed the ability of the media and government to sweep things under the rug.

The goal now isn’t to prevent this crisis, simply to hide it long enough to get through the election of 2012, after that this will be another “serious crisis the government won’t want to let go to waste“.  Trust me no matter who is in the White House the play will be the same, a currency re-basement.  If the dollar in its’ current form still exists by 2016 I will be totally shocked.

The winners will be the banks, the government and the financial elite.  What can we do about it?  Sadly very little!  Your only play right now is to hedge some of your money into gold and/or silver, eliminate debt and save some cash.  Sure your cash will be devalued during a debasement but it will pale in comparison to the beating stocks and equities are going to take.  Don’t think for one moment such a re-basement equals the total end of civilization, that is a lie designed to sell you gold and other items by playing on your fears.

If you want to get a feel for what this will be like, take a time trip back to 1933 when FDR took the nation off the gold standard, gold was worth about 33 dollars an ounce in the global market at the time.  Citizens though were forced to surrender it for just a hair over 20 dollars per ounce in the new money.  Folks that was a “currency collapse”, one day you owned 50,000 dollars in gold, the next day you owned about 30,000 new “US Dollars”.  This time around we may very well move back to a new glorious “gold standard”, when we do guess what, your “dollars” will have the same numbers on them but their value will decrease overnight in the global market place.

You can call me nuts if you want to but odds are I will bring you another city on the edge of the abyss before this week ends and I bet it won’t be long before the Fed once again fires up the printing presses.

 

 

Harrisburgh PA, Threatens Bankruptcy – Pennsylvania Lawmakers Say Not So Fast

A new state law will punish cities like Harrisburg for declaring bankruptcy before July of next year.

So a few days ago I called Pontiac Michigan a “Canary in the Coal Mine“, a sign of things to come, just the beginning of city level defaults that would eventually lead to state defaults.

Today I have more news on that front for you.  Another city in a lot of trouble is Harrisburg, PA.  Harrisburg is a very different place than Pontiac but subject to the same laws of mathematics.  Basically when you spend more than you have for long enough eventually you are screwed.

Harrisburg has been teetering on financial collapse for quite a while and has been recently attempting to stave off creditors with the threat of bankruptcy.   In short asking for better payment terms, reducing debt by negotiation with the concept of “if you work with us you will get what we can give you, if you work against us you will get little or nothing if we file bankruptcy”.  To me this actually sounds reasonable, any company would do this, dealing with employees, suppliers or debt holders.

Of course the government believes they know better and wants to make bankruptcy hurt a city more than it already does, according to a report by WHTM ABC27, a new law was just passed that states…

“Small to medium-sized cities that are deemed by the state to be financially distressed would lose all state aid if they file for bankruptcy protection before July of next year.”

So basically a city like Harrisburg would loose state funding at the time when they most needed it.  This of course will embolden their creditors who will make more demands which may very well push the city into bankruptcy even more quickly.

I want to be clear Harrisburg isn’t as bad off as Pontiac, not yet anyway, but here again we see another city on the verge of economic collapse.  The collapse of Harrisburg’s finances is coming, the law MIGHT, stave it off until 2012 but you can’t prevent people from running out of money with a law, if you could we would just outlaw poverty and eliminate it as a problem.   The sad and scary thing is out there right now in the tiny brain of a politician that thought is being seriously considered!

Now for something far more sobering and concerning.  I have profiled two cities this week in different stages of bankruptcy, I could continue to profile one a week and not run out of cities to profile for over two years even if no additional cities were added to the current list.

Sooner or later this will drag us into stage to of the double dip recession that is more accurately a depression.  It may not be this year or next year but if you have money in stocks and bonds, keep a very close eye on this situation.  Protect your investments with stop losses and/or covered shorts.  Do not keep 100% of your money in stocks and bonds, do not keep 100% of your money in precious metals or US dollars.  Practice true diversity and please be prepared to move our of your exposed positions long before the sheep figure out it is time for “Slaughter House Two” to air.

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