Are You Kidding Me!

The big recession ended in 2009, right?  Ask anyone on the street and see if they agree.  I read a CNS News article this last week where the Democratic National Committee Chair (DNC) said that “…anyone can see the economy is improving.”

Are you kidding me?

Robert Kiyosaki, the author of “Rich Dad, Poor Dad” and other titles, is even warning of a possible economic collapse.  I heard an interview with him the other day where he said the situation is dire and  estimates about a 20% chance of collapse.  Sure we’ve handled dire economic struggles in the past and survived, but the issue is that we are so much more “global” now with technology, that even if we were doing ok, the economic downfall of other nations affects us now.  Add in that we are NOT OK, well we all are feeling it.  High unemployment, rising taxes, higher food prices, home foreclosures, and more.

1. The 2010 census shows the housing bust is the worst since the Great Depression, with home ownership falling to 65.1% last year. (AP article on 10/6/2011 by Hope Yen)

2. The Governor of the Bank of England, Mervyn King, says that the “World is facing the worst financial crisis since at least the 1930’s ‘if not ever.'” (The Telegraph article on 10/6/2011 by James Krikup)

3. Moody’s cut the rating on 12 UK financial institutions this last week.  (CNBC article on 10/7/2011 by Antonia van de Velde)

4. Credit rater Fitch downgrades Italy and Spain – again. (Reuters article, 10/8/2011)

5. Per person debt is now $44,980 up higher in the last 2 1/2 years than that from all presidents combined. (CNSNews.com article 10/5/2011 by Terence Jeffrey)

6. Bank managers surveyed don’t believe home prices will recover before the year 2020. (CNBC article 10/1/2011 by Karina Frayter.)

7. The Biggest quarterly drop in the stock market since the 2008 financial crisis.

 

Anyone still think we’re in recovery??

New York, Tomato Soup, and Berries

What do New York City, Tomatoes and berries have in common?  I can think of a few things off the top of my head like: each have a “seedier” part, and some people like them, some don’t.  But what I really had in mind was that they are all things my husband and I enjoyed this last week.

New York City

Why is New York City called “The Big Apple” anyway.  I didn’t see a single apple tree growing – anywhere.   I had to find out so I turned to my favorite source of information: Wikipedia.  It turns out that a writer for the New York Morning Telegraph, John J. Fitz Gerald, coined it in the 20’s and continued to use it repeatedly in articles.  Other writers joined in over time and, there you have it. (See the Wikipedia article on it here).

I managed to find a great airfare sale and got tickets for New York for $450 round trip for both of us. We had visited back in 1999 and James had always wanted to go back.  So, when the sale popped up, I snagged it.  I really needed a break from a busy work schedule, so the short trip was just what I needed.  We spent the first day with a car and headed south into New Jersey to visit the beaches. 

We picked Sandy Hook to visit and weren’t disappointed.  What an amazing place.  It has the oldest working lighthouse in the United States.  It also used to be a huge fort that protected the waters going into New York. The spit of land is very strategic as it juts into the lower New York Bay.  All boats pass it as they head into the large city.    There were quite a few bunkers, guns, and buildings all still intact.  There is still a row of  large officer homes, most in disrepair, that face the west and have lovely views of the water and beach.  Some of the homes and buildings are now museums.  We climbed up to the top of the lighthouse and even with a muggy, grey day, we had great views of Staten Island and Brooklyn which was directly north. You could faintly see Manhattan beyond that.  Sandy Hook is part of a large park system called Gateway National Recreation area that is one of the largest on the East Coast.  It covers three separate large areas of Brooklyn, Staten Island and Sandy Hook which contain a total of eleven parks. The vast bay separates all three areas.

The following day we took a shuttle into New York and found our hotel. We spent the next few days riding the “Hop on Hop Off” bus and catching the history and memorable areas of the city.  We visited Times Square the most.  We found out that advertisers are required to keep those signs lit up 24x7.  There are serious consequences if they don’t stay lit, fines and repeat offenses can result in the ads being booted off the famous square.

Tomato Soup

My garden has been producing a LOT of tomatoes.  Even with giving many away, I have way too many to eat, so I made home made tomato soup.  Now that is a comfort food.  Sautee some onions, garlic, add in a lot of chopped tomatoes, broth, basil (also from my garden), simmer, add in some cream and then blend up in the blender.  As Rachael Ray says “Yummo!”

I still have more tomatoes, so I think I’ll make some spaghetti sauce next.

Berries

I live near a walking path that is rarely used and is LOADED with blackberries (with no sprays or intervention by man).  We picked some about two weeks ago and made a home made cobbler.  It was hot out of the oven and oh so tasty!  I’ve decided that I need a lot more so I can make some jam.  That sounds like a great way to store up fresh, organic preserves that will last the winter.  I’ll probably do that today.

So I’m prepping for winter by getting myself rested on a nice vacation, putting up my tomatoes, picking berries, and oh yes, I almost forgot – I bought two big sweaters in New York.

Fall – bring it on.

I Told You So

The news is so bad these last few weeks, I struggle with where to start.  Some have poo-pooed my warnings and urgings to prepare and store for what I believed was sure-to-come financial upheaval.  Since I started blogging about this in November of 2010, gold is now up from $1375 to now hitting $1700 an ounce.  Silver was just under $28 an ounce and is now bumping $40.

Food supplies are in danger due to drought and natural disasters, not only in the U.S., but in other parts of the world where we get some of our foods.  I was in Walmart the other day and was shocked to see multiple signs around the produce department stating that the supply was impacted due to drought conditions and prices certainly reflected that. The prices were over double what I normally see for Walmart produce.

Our country’s credit rating was dropped by Standard and Poor’s and more credit rating agencies are threatening to drop their ratings as well.  The chairman of the Chinese rating agency, that has also downgraded the U.S., says that the world is discarding the U.S. dollar.  Standard and Poor’s says it may even downgrade the dollar further!  The stock market is melting on the awful downgrade news. All the while, former Fed chairman Alan Greenspan says there isn’t a problem because we can always print more money. Guess where that will take us?  Straight to inflation, or possibly even hyperinflation.  That sounds like a good move – NOT.

So if you’ve been paying attention to the news and politics at all in the last few months, you should have shaken yourself out of any apathy that might have been resident in you and started to think about your future.  Take this as a huge wake-up knock on the head to get out of debt before interest rates rise.  Buy extra food and save up money and even some silver or gold to help you weather the probable downturn our country’s financial “machine”.  The machine isn’t working so well and it looks like it is going to break.  I personally don’t believe the “machine” is repairable with our existing Congress and their inability to cut our deficit and spending by any significant amount. 

Wake up. Smell the coffee.  Things are not same-old-same-old anymore.  The landscape is changing right in front of our eyes.

Image: scottchan / FreeDigitalPhotos.net

It’s All Greek to Me

Greece’s economy has been floundering for quite some time and as the government scrambles to stay afloat, the citizens are protesting those moves in sometimes violent uprisings.  What’s scary is the impact this all has outside of Greece.  In a Reuters article (6/24/2011), “European banks and insurers are scrambling” and “stocks continued to decline and credit default swaps for Greece, Italy and Portugal widened on the renewed concerns about a potential default. The Euro also declined against the US dollar for the third straight day.”

James Neuger (6/22/2011) of Bloomberg writes that,  “…European leaders’ failure to tame a crisis that is entering its 21st month and has world leaders growing anxious over the prospect of a new financial tsunami as they shake off the effects of the last one.”  He quotes Andrew Balls, the head of Pacific Investment Management Company European portfolio management, “The 256 billion euros in aid committed to Greece, Ireland and Portugal have done little more than buy time against a looming default.”  He goes on to say, “If you quarantine Greece, Ireland, and Portugal, take these countries out of the market, have them do their adjustments, then you can buy time for Spain, buy time for banks to recapitalize.”

Greece’s Papandreou and his new government is trying hard to restructure the spending and bring in austerity measures. The people don’t like it.  Protesters line the streets and police are called out to break up the mobs with tear gas.  Neuger writes about “Reform Fatigue” that is now in the streets; support of these floundering economies is fading as well. Some see a split coming for the euro.  The split is between the wealthier northern countries and the poorer ones of the south.  It is now being reported that Italy is facing serious financial difficulties after supposedly healing up from economic wounds in 2009 and 2010.  Moody’s is threatening to downgrade Italy’s credit rating.  A USA Today article (6/24/2011)  says that this “Italy’s  financial system has come under further scrutiny on fears of contagion from the Greek crisis.” The article states that, “The move comes after Moody’s put Italy’s public debt on review for possible downgrade over concerns about low growth and high public debt, which is around 120% of GDP is one of the biggest in Europe.”

It seems that, in today’s global economy, the impacts of one country stumbling are significant.  The investments of banks all over the world which hold the debt of these governments become unstable.  Countries that are stronger and hold investments in many of these powerful banks have to throw their good money after bad. Everyone suffers. An article from TheTrumpet.com (6/22/2011) noted Jean-Claude Juncker, head of Eurogroup – the eurozone’s finance minister, said, “…that the Greece crisis could affect Italy and Belgium, saying that “We’re playing with fire.”” The article went on to state that “The crisis could now be spreading beyond Europe’s most vulnerable nations.  If it continues, even France’s credit worthiness could be in danger.”

So what does this upheaval in European economies mean to us? The U.S. is not far behind.  We’ve been warned about our credit rating.  We have no money left.  We spend more than we bring in.  Our debt is unsustainable.  When (and I do hope it happens) they do initiate the necessary spending cuts needed to get our budget under control, I suspect we’ll see protesters, not unlike what is happening in Europe, hit the streets.  People like the idea of fixing our budget woes but hate it when those cuts hit them.  The alarming thing is that many cities have had to cut police and fire in order to meet their budgets.  That means the cities may have trouble keeping up with the potential issues that could arise.
What do you do?  Here are just a few things to think about:

• Pay off your own personal debt so you don’t get caught up in any interest rate hikes that are likely to come.  Live within your means.
• Become independent: don’t rely on government hand outs in any way shape or form – they likely will go away
• Be prepared for higher taxes, even on your 401k’s (yes, our government has even talked of that)
• Be prepared for angry citizens who don’t like the cuts that will be required

I know I haven’t even come close to covering everything you should do to steel yourself for the economic upheaval I believe is coming our way.  These are just a few things to think about.
Feel free to comment on other good ideas.

And They Said the Recession Was Over…

I remember hearing reports in 2010 that the recession was officially over in 2009. The National Bureau of Economic Research (NBER), an independent group of economists, reported that the recession started in December of 2007 and ended in June of 2009.  Well, I didn’t buy it.  Things still looked pretty bad to me.  My gas cost more, my food cost more, many friends and acquaintances were losing jobs and homes.  And it hasn’t seemed to get any better.  In fact, since 2009, my food bill has gone up for staples like milk, eggs, sugar, and fresh produce.

A May 25th article in Bloomberg by Alan Bjerga and Leslie Patton explain that U.S food-price inflation may top the government’s forecast because higher prices for meat, dairy and energy hit large corporations like Nestle, the largest food company in the world, McDonald'’s and Whole Foods (the world’s largest natural foods grocer).

Another Bloomberg article on June 8, 2011 by Sungwoo Park said “Gold May Gain as Rallies in Corn, Oil Fan Concern Inflation May Accelerate.”

The Daily Caller posted an article by Neil Munro (June 8, 2011) with the headline, “Federal Data Shows Troubling Unemployment, Underemployment Trends.”  That article states that, “Less than half of African-American men now have full-time jobs, and less than half of all white men will have full-time jobs in 2018…”

A recent CNN poll was written about in the left-wing site Huffington Post (June 6, 2011) by James Sunshine, stating that nearly half of all Americans believe we are nearing a great depression.

Time Magazine’s June 8th cover story: “What Recovery? The Five Myths About the U.S. Economy.” 

• Myth 1: This is a temporary blip, and then it’s full steam ahead
• Myth 2: WE can buy our way out of all this (Kat’s note: QE/stimulus packages don’t work)
• Myth 3: The private sector will make it all better
• Myth 4: We’ll pack up and move for new jobs
• Myth 5: Entrepreneurs are the foundation of the economy (Kat’s note: our current Administration’s policies have made entrepreneurship a complicated and difficult.  This suppresses that inherent entrepreneurial spirit that has long been the back-bone of the U.S. economy.)

So are you better off now than you were 2 years ago in 2009 when the recession ended?