Your Future: Economic Meltdown for Decades!
September 21, 2015
My predictions are not based on special revelation from God, just common sense and knowledge of public affairs. I also believe you can’t go wrong if you depend on sinful man being sinful man! My four-fold prediction for the next 12 months: (1) there will be major political battles in Congress that will bruise egos and destroy careers. (2) there will be very bloody racial killings in many major cities that will be considered a race war. (3) I also think that Islamic terrorists will strike the U.S. mainland with repeated, devastating blows turning most Americans against all Muslims. (4) I think the economy will meltdown with results lasting for decades! And I’m an optimist!
In the last few years the world has seen one economy grow like never in world history—China has exploded on the world scene. A few years ago China made no laptops and now makes more than 40% of them that are sold worldwide. They produce about 40% of the world’s cell phones and half the shoes of the world! The Chinese make the television sets and Americans watch them. Chinese peasants are saving 40% of their meager incomes and Americans are saving none! Of course, since we spend 10% more than we make, it is impossible to save.
China’s economy has slowed and they have sold 520 billion dollars in U.S. Treasury Bills in the past 15 months! They are dumping their U.S. debt; moreover, this month China announced that they purchased 600 tons of gold in one month! What does China know that others don’t know? Furthermore, economists believe that China is not dumping dollars because of retaliation against the U.S. but because of massive internal problems.
Millions of U.S. jobs have been lost to Mexico, India, and the rest of the world. Bankruptcies, personal and corporate, are at an all-time high. Detroit; Jefferson City, AL; Orange County, CA; Stockton, CA; and San Bernardino, CA have gone bankrupt to the tune of billions of dollars. And note that three of the five are located in California ruled by “Moonbeam” Brown.
Montgomery Ward, a solid fixture in America’s past, has been long dead and not even known by many Americans. Gone is Enron, Pacific Gas and Electric, Radio Shack and others! A & P is gasping for breath and will be dead in a few months; a sickly Kmart (who bought sickly Sears) and J.C. Penny are in their death throes; Abercrombie & Fitch is dying for which no one should mourn; even IBM is valiantly struggling to stay alive. GM and Chrysler are still breathing only because U.S. taxpayers (Obama) bailed them out of deep water. The clock is ticking and Americans are sleeping. But “after all, this is America” and “it can never be like it was during the Great Depression.” Can it?
However, financial experts like James Cook say otherwise: “In a country where savings are negligible, spoiled and pampered people are commonplace, millions of people enjoy subsidies and half the people can’t scrape a thousand bucks together, you have the formula for national bankruptcy,… and confiscatory government.”
Michael O’Higgins, Money Manager answers, “When you say it can’t be like 1929 through 1931 [when stocks lost 89 percent of their value], you’re right. It could be worse.” Fear mongering? No, just the facts.
Dr. Kurt Richebacher, financial wizard was asked: What’s the nature of this recession you predict? He answered: “It will prove unusually severe and long.”
Bill Buckler, wrote, “Asian Central Banks alone hold $US 1.4 TRILLION in liquid U.S. ‘paper.’ If just a part of this immense stock of funds lent to the U.S. were to start to run for the exits, the entire U.S. financial system would be forced up against a wall and then off a cliff.” The stampede has started. In the January 23, 2004 issue of the Asian Times they opined: "All Beijing has to do is to mention the possibility of a sell order going down the wires. It would devastate the U.S. economy more than any nuclear strike."
We are told by the talking heads on television that the stock market will bounce back, but they don’t tell viewers that the market also bounced back following the crash in 1929 only to crash later! Besides there is more to the economy than the stock market.
While I am by no means a financial expert I can read graphs and make comparisons. I would not be in the stock market except for gold and silver stocks or unless the funds I invested in had some kind of insurance guarantee. But then if the whole economy goes down the tubes, most “guarantees” would be worthless. I would use any “bounce” in the market to get out especially if I could make a profit. Then I would put that money in rental property. In most areas you can purchase doublewide mobile homes for a very reasonable amount and rent them for $600 or more per month. Before making a commitment you should check all local ordinances to make sure there are no prohibitions regarding mobile homes.
Try to scale down your lifestyle in preparation for difficult times ahead. Do you (or your adult children) really need such an expensive home? Or automobile? Why not purchase a smaller home or smaller car? It is incredible that so many homeowners are paying $1000 and $1,200 per month for a home when they can hardly make the payments. Many have second mortgages having been told to “take your cash value” in your home; however, your home isn’t a life insurance policy. It is your home. And home prices fluctuate. Very foolish people take a second mortgage on their home to purchase other items or to pay monthly bills! That is a scenario for disaster. You can’t borrow yourself into financial freedom just as you can’t fornicate your way back to virginity.
The money managers in the U.S. Government have kept interest rates down so that young couples find it difficult to resist borrowing to finance their high standard of living, but such decisions are insane. Thus far, it has worked. In fact, that has probably been what has kept our nation from going bankrupt but Ludwig von Mises was right when he advised: “Expansion of credit does lead to a boom at first, it is true, but sooner or later this boom is bound to crash and bring about a new depression.”
Those of you who are in your 60s should look very closely at your finances. If you have a choice of taking a lump sum retirement or monthly payments, I would go with the lump sum. Many pension plans are billions of dollars underfunded. I don’t mean to scare you but some funds may not survive the next two years. Washington insiders are very concerned about pension plans, and the federal insurer undergirding 31,000 U.S. pension plans confessed that there are “multi-faceted and profound challenges” ahead for Americans.
It is time to reevaluate your financial position, and make decisions to cover various contingencies whenever possible. Simplify your life, scale down your lifestyle, and get out of debt.
The party is almost over.
Dr. Don Boys is a former member of the Indiana House of Representatives; ran a large Christian school in Indianapolis, wrote columns for USA Today
for eight years; authored 15 books, which can be purchased below, and hundreds of columns and articles for Internet and print media publications; defended his beliefs on hundreds of talk shows. www.cstnews.com
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