Retailers in Big Trouble: Nobody Spending on Black Friday

American consumers shopped more for bargains at the start of the U.S. holiday season and spent significantly less than a year ago, according to early data released on Sunday.

Consumers said they will have spent nearly 8 percent less on average, or about $343 per person, over the weekend that includes U.S. Thanksgiving Day, Black Friday and runs through Sunday, according to the National Retail Federation.

While traffic to stores and retail websites rose to 195 million people from 172 million in 2008, the early data this weekend represents a worrisome sign for retailers, who had braced for weak sales and sought ways to protect margins.

Data released by ShopperTrak on Saturday showed that sales rose a scant 0.5 percent on Black Friday, which is often the single busiest day of the holiday shopping season.
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George Carlin on The Government and Education Rated R

George Carlin - Education and the Elite
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Potential For Fed To Hyperinflate

The following information may be the most important we have ever published. One of our Intel sources, highly placed in banking circles, tells us that on 1/1/10 all banks that have received TARP funds have been informed by the Federal Reserve that they must further restrict any commercial lending. Loans have to be 75% collateralized, 50% of which has to be in cash, which is a compensating balance.
The Fed has to do one of two things: They either have to pull $1.5 trillion out of the system by June, which would collapse the economy, or face hyperinflation. This is why the Fed has instructed banks to inform them when and how much of the TARP funds they can return. At best they can expect $300 to $400 billion plus the $200 billion the Fed already has in hand.
We believe the Fed will opt for letting the system run into hyperinflation. All signs tell us they cannot risk allowing the undertow of deflation to take over the economy. The system cannot stand such a withdrawal of funds. They also must depend on assistance from Congress in supplying a second stimulus plan. That would probably be $400 to $800 billion. A lack of such funding would send the economy and the stock market into a tailspin. Even with such funding the economy cannot expect any growth to speak of and at best a sideways movement for perhaps a year.
We have been told that the FDIC not only is $8.2 billion in the hole, but they have secretly borrowed an additional $80 billion from the Treasury. We have also been told that the FDIC is lying about the banks in trouble. The number in eminent danger are not 552, but a massive 2,035. The cost of bailing these banks out would be $800 billion to $1 trillion. That means 2,500 could be closed in 2010. Now get this, the FDIC is going to be collapsed before the end of 2010, which means no more deposit insurance. This follows the 9/18/09 end of government guarantees on money market funds. Both will force deposits into US government bonds and agency bonds in an attempt to save the system.
LINK HERE

Martin Armstong – Forced to Move to a High Security Prison to Silence Him?

Frankly, I cannot believe that I have to write the words that follow. I just learned that Martin Armstrong is being moved, possibly as early as Monday, from his current holding facility to a much higher security facility, MDC Brooklyn, which is similar to the facility he was in when he was in solitary confinement and where he was beaten nearly to death! This goes against the prison’s own rules and is against the law as he has two Habeas cases open in the Supreme Court.

Why would this be happening now with a little more than a year before he is eligible for parole? I and others contend that it is because of his recent writing activity and because of his recent interview with the New Yorker Magazine (- The New Yorker - "The Secret Cycle…"), and also because there are now several media outlets requesting to do interviews with him – the prison simply does not want, for whatever reason, the access that we have been enjoying lately to continue. I spoke directly to Martin’s younger sister, Nancy, and this is her opinion as well. She is very upset over this move as she, “fears that he may not make it out.” She claims that Martin is very much afraid of this move and for good reason…

First let’s review the facts… whatever you believe about his innocence or guilt or innocence of any crime, the facts are that he was never put on trial for any crime. He was held in contempt of court for not producing what the judge ordered him to produce, something which he claims he didn’t have. He was placed in MDC Manhattan and was basically TORTURED. According to Nancy, he was locked in solitary confinement for almost the entire duration, suffering days on end and at times was intentionally awaken every hour or so all night long, night after night, in an attempt to get him to sign a confession. He was repeatedly told that he would not get the chance to see his 91 year old mother alive again if he did not sign the confession. This took place off and on for SEVEN YEARS. Then one day a huge convict, “a known homicidal maniac” named George, was locked in his cell with him where he proceeded to beat and strangle him until he thought he was dead. Later, according to Armstrong, a fellow inmate stated that the guards watched the beating and refused to open the door to stop it. He lost most of his teeth, and now, over two years later is still missing them because the prison system only has one dentist for over 5,000 inmates. He suffered a detached retina, broken ribs and other internal injuries that left him in intensive care.
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Shocking: High School Grads Twice As Likely To Be Jobless Than College Grads

The economic meltdown has hit non-college grads much harder than the educated. And conservatives are very good at exploiting their anger and unease. Tools
You know how bad the economy is, right? Maybe your 401(k) has tanked. Perhaps you were out of work for a few months. You could have a mortgage under water. Or your health insurance has an impossibly high deductible. Yeah, we're all singing the blues.

I've gotten out my violin to play a mournful accompaniment to our collective angst.

Wait, what's that I hear in the distance? A dissonant, thundering chord someone just hammered on the piano -- a harsh interruption of my languid dirge. Now it repeats, getting louder and nearer.

It's the sound of rage, of people I don't know -- millions of them -- unable to make rent or feed their families. Why don't I know them? They don't have college degrees, and nearly everybody I know does.

The truth is, brothers and sisters, however much we the degreed are suffering, we don't know the half of it. And unless we familiarize ourselves with the other half very, very soon, what was supposed to be a new progressive era could quickly give way to the rage of the Tea Party.
LINK HERE

Kondratieff Winter: Depression Until 2020?

*The following lays out the sequence of the events following the 1929 stock market crash.

Phase 1
"A flight from questionable securities into strong securities." This occurred during the initial stock market crash in 1929. The stock market recovered 50% of its losses into April 1930. Then as the bear market resumed, all securities, except for the gold shares, were sold regardless of quality. Following the stock market peak in October 2007, this flight from questionable securities into strong securities gathered momentum into November 2008. Following a probable stock market partial recovery into April 2009, all securities, except for gold shares, will likely be sold, as the bear market resumes with a vengeance.

Phase 2
"An intense liquidation of inventories and commodities" Then, 1930-1933; now, starting in July 2008 and continuing into a deflationary bottom, perhaps by 2012.

Phase 3
"The liquidation of commercial real estate, houses and farms, both through foreclosures and sacrifice sales at a fraction of prior values." Then-1930-1939; now, houses-starting in July 2007; commercial real estate just beginning; and farms to follow.

Phase 4
"The flight from banks into cash and gold (which ultimately caused the whole US banking system to collapse.)"-Then-1930-1933; now, mid-2008, perhaps until mid-2009; by which time US T-Bills are likely to become suspect monetary investments, which would make gold the ultimate store of value.

Phase 5
"The flight from the dollar to gold."-Then, October 1931-March 1933. In 1933, President Roosevelt stopped the flight to gold by suspending gold convertibility for the dollar and confiscating all privately held gold. Thereafter, the only way Americans could own gold was by investing in gold company shares. Nevertheless, the value of Homestake Mining shares had already tripled prior to the confiscation. This 5th stage is still pending, awaiting the demise of the dollar.


The Long Depression will last until 2020

Kondratieff Cycle-Side Bar

Bob Chapman (Video): This is Very Serious

Bloomberg Reporter who Sued the Fed has Died
Mark Pittman, the award-winning investigative reporter whose fight to open the Federal Reserve to more scrutiny led Bloomberg News to sue the central bank and win, died Nov. 25 in Yonkers, New York. He was 52.
LINK HERE

Politicians Don't Want Public to Know: Britain Faces Financial Armageddon

A year ago, the world reacted with astonishment as Iceland technically went bust. It seemed inconceivable that a modern democratic nation could have such parlous finances that only an emergency $6billion bail-out from the International Monetary Fund enabled its economy to keep functioning.
This week, we witnessed a similar crisis in the Middle East but on a far, far more dangerous scale, as Dubai effectively defaulted on £48billion of loans.
Unless its more prudent and oil-rich neighbour, Abu Dhabi, launches a rescue plan then Dubai - once a gilded monument to financial success - will effectively be insolvent.
(snippets)
Which leads us to a haunting question: as the country in the world hardest hit by the credit crunch, with gross domestic product (GDP) projected to decline by almost five per cent in 2009, could Britain be next?
Let's think the unthinkable for a moment. These are the facts.
Even before the financial crisis, the British Government spent roughly £30billion more per year than it earned in tax revenues. This money, of course, had to be borrowed from international investors.
Today, the Government needs up to £200billion a year for at least the next three years in order to meet its spending commitments. But the Government's estimates invariably understate its true need, and they have to be continually revised upwards.
Before the crunch, total government debt stood at roughly 40 per cent of GDP. It is now around 60 per cent of GDP, but is projected to soar close to 100 per cent in the next few years. But again, that is not the full story.

The news is potentially so bad that politicians simply don't want the general public to know what's going on.
Given the scale of the crisis, what then do they propose? New Labour is non-committal, suggesting that cuts will be prudent, thoughtful and spare people's worst pain. The Conservatives have targeted around £7billion of spending cuts, but these won't happen immediately and are nothing like enough to rebalance the nation's books.
LINK HERE

Prepare for the Great Depression.
Survival Seeds

Economic Crisis in Eastern Europe Deepens

(snippet)
The International Monetary Fund has also issued a number of blunt warnings about developments in eastern Europe. The Austrian Standard quotes IMF economist Christoph Rosenberg, who declares that the recent recovery of financial markets in the region is almost exclusively due to the increased appetite for risk on the part of investors and has little to do with any improvements in the real economy. Rosenberg warns of a new stock market bubble, which will have dire consequences when it collapses.
Rosenberg was not prepared to commit himself when asked if conditions would improve for eastern European markets. “We can only do what we did prior to the economic crisis—warn of the dangers,” he said.
However, when one examines the state of economic conditions, one can only conclude that it is already too late for warnings. The situation is most dire in the Baltic states. In Latvia, bankers are speaking of a “dramatic development.” Despite draconian austerity measures by the government, the country is moving ever closer to bankruptcy.
The rates for credit default swaps, which reflect the perceived risk of state bankruptcy, currently lie between 500 and 600 points for the Baltic states. In comparison, the rate for credit default swaps for Austria is around 60 points.
LINK HERE

The Economic Crisis and What Must be Done

The United States does not control its own destiny. Rather it is controlled by an international financial elite, of which the American branch works out of big New York banks like J.P. Morgan Chase, Wall Street investment firms such as Goldman Sachs, and the Federal Reserve System. They in turn control the White House, Congress, the military, the mass media, the intelligence agencies, both political parties, the universities, etc. No one can rise to the top in any of these institutions without the elite’s stamp of approval.

This elite has been around since the nation began, becoming increasingly dominant as the 19thcentury progressed. A key date was passage of the National Banking Act of 1863, when the system was put into place whereby federal government debt was used to collateralize bank lending. Since then we’ve paid the freight through our taxes for bank control of the economy. The final nails in the coffin came with the passage of the Federal Reserve Act of 1913.

In 1929 the bankers plunged the nation into the Great Depression by constricting the money supply. With Franklin D. Roosevelt as president, the nation struggled through the decade of the 1930s but did not pull out of the Depression until the industrial explosion during World War II.

After the war came the Golden Age of the U.S. economy, when the working man, protected by strong labor unions, became a true partner in the prosperity of the industrial age. That era lasted a full generation. The bankers were largely spectators as Americans led the world in exports, standard of living, science and space exploration, and every measure of health, longevity, and culture.

Roosevelt had kept the bankers subservient to the interests of the economy at large. The Federal Reserve was part of the New Deal team, and interest rates were held at historic lows despite a large federal deficit. One main impact was the huge increase in home ownership. After World War II, the G.I. Bill allowed home ownership to grow further and millions of veterans to attend college. The influx of educated graduates led to productivity growth and the emergence of new high-tech industries.
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Value Added Tax Coming: US Will Have to Tax Consumers

The U.S. will need to eventually enact national value added tax in order to raise revenue and decrease its deficit, Paul Donovan, MD & deputy head of global economics at UBS, said Thursday.

"The United States is the only OECD without a national value-added tax. And I think they are going to have to go down that route at some point," Donovan told CNBC.

"It's a cheap way of raising money. It is a very effective way of raising money. It is not a very equitable way of raising money — it falls disproportionately on lower income groups. So you may have to make some other changes to the tax code to try and compensate for that. But that is actually going to be a good way of raising money," he said.
LINK HERE

Big US banks may be forced to raise more capital soon: Analyst
Most big US banks may be forced to make public offerings soon if the Treasury demands payback of the funds it issued under the Troubled Assets
Relief Program, veteran banking analyst Richard Bove said.
LINK HERE

Biden Is Right: Obama Administration Is Our Worst Nightmare

Vice President Joe Biden issued a somber warning for opponents of the Obama administration's agenda, telling party loyalists during a fundraising speech in Iowa that the naysayers "should be worried about us, for we are their worst nightmare." Duh.

Finally we can agree on something, Joe. Even the liberal New York Times reports that, at the current level of federal spending, the annual interest on the national debt will exceed $700 billion by 2019 — compared with $202 billion this year. Some forecasters predict it will be much higher. This additional half-trillion dollars a year in interest is more than our combined expenditures on education, energy, homeland security, and the wars in Afghanistan and Iraq.

Oh, and the Times isn't even factoring in the cap-and-trade nightmare you and Barack have in store for us, Joe — you know, that urgent legislation to catapult the nation back into Third World status based on hysteria generated by fraudulent science and corrupt zealots and politicians.

Nor is the Times including in its calculations the additional debt that would result from Obamacare.

Joe, when The New York Times is sounding the alarm over the exploding national debt, you and Barack Obama insist not only on not reversing your disastrous course but also on making it worse. How can reasonable people assume anything other than that you are trying to run this nation into the ground financially?
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IRS files $79,000 tax lien against Schwarzenegger
A federal tax lien would be attached to all of the governor’s properties, according to the IRS.
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Warning: Major Sovereign Default Possible

(Bloomberg) -- Dubai’s debt woes may worsen to become a “major sovereign default” that roils developing nations and cuts off capital flows to emerging markets, Bank of America Corp. said.

“One cannot rule out -- as a tail risk -- a case where this would escalate into a major sovereign default problem, which would then resonate across global emerging markets in the same way that Argentina did in the early 2000s or Russia in the late 1990s,” Bank of America strategists Benoit Anne and Daniel Tenengauzer wrote in a report.

A default would lead to a “sudden stop of capital flows into emerging markets” and be a “major step back” in the recovery from the global financial crisis,’’ they wrote.


CITIBANK USED BAILOUT MONEY FOR DUBAI
The US public will be “outraged” by Citibank’s $8 billion loan to Dubai just six weeks after the bank was bailed out, US House of Representatives domestic policy subcommittee chair-man has said. Dennis Kucinich commented on the Dubai loan and other US banking investments as a congressional panel released a report that strongly questioned Citibank’s actions. The report, shown to 7DAYS, cites the Dubai loan as the largest of the “questionable transactions” by banks after the US government bailed them out. It notes that the loan to Dubai’s public sector came on December 14, just six weeks after the US government gave Citibank a $25 billion bail-out.
LINK HERE

DUBAI DEBT IS 184 BILLION
LONDON: The United Arab Emirate (UAE) has total debt amounting to $184 billion at the end of 2009, according to estimates by Bank of America-Merrill Lynch.
LINK HERE

Parties Being Held in Vacant Houses All Over U.S.

SANDY SPRINGS, Ga. — Some of the most elegant addresses in all of Atlanta are found in this wealthy enclave. Sprawling mansions that occupy 2- to 10-acre lots are home to some of the city's most prominent residents.
They were shocked last month when a massive Halloween party exploded in their midst. More than 1,000 people jammed the streets around the brick-and-rock mansion, paying $20 apiece for admission and riding shuttle buses from the parking lot of a nearby Publix grocery, police say.

"It was one of those things, be careful what you wish for," says Sandy Springs police Lt. Steve Rose. "(The event promoter) got a lot more than he expected. It became a gridlock issue with traffic."

Police say the party had been heavily promoted at Georgia State University in Atlanta and at the University of West Georgia in Carrollton. Food and alcohol were being sold inside the six-bedroom mansion.

"It was unbelievable," says neighbor Kathy Battaglia, a user-support analyst for an accounting software firm. "The noise over there was so loud it may as well have been in our house. It sounded like the whole party was in the front yard and on the front porch."
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Case-Shiller Still Predicts Massive 45% Fall from Today’s Values

The 10 major cities in the Standard & Poor's/Case-Shiller home price index have risen 5% from their April low, but the index is still predicting a massive 45% fall from today’s values.
Tuesday's new number from the index showed a gain of just under .5% for the month of September, but the index remains 30% below the high in June 2006. Based upon a trend generated from the actual prices of 1987 to 1997, and generated forward in a linear projection, the index will fall a total of 62% before it reaches the trend norm.
A more comprehensive analysis of the 10-city index based upon a 120 years of data shows current values off 36% and a comparatively modest 20% fall ahead.
LINK HERE

Prepare for the Great Depression.
Survival Seeds

Vietnams Dollar Just Devalued

Nov. 26 (Bloomberg) -- Vietnam’s dong fell to a record low after the central bank devalued the currency to curb quickening inflation and a widening trade deficit. Stocks dropped and headed for the worst week since October 2008.

The State Bank of Vietnam yesterday set the reference rate for today’s trading 5.2 percent lower at 17,961 against the dollar, after the difference between spot and black-market rates widened to the most in a decade. The dong has fallen 5.4 percent this year, set for a second annual decline.

“The central bank is trying to regain control of the foreign-exchange market by stepping up with an aggressive approach to stop the drift in the unofficial market rate,” said Fiachra MacCana, managing director and head of research at Ho Chi Minh City Securities Co.

The dong declined 3.3 percent to 18,488 against the dollar as of 3:41 p.m. in Hanoi, according to data compiled by Bloomberg. It earlier traded as low as 18,500, 3 percent weaker than the reference rate. The central bank yesterday narrowed the daily trading band to 3 percent from 5 percent to limit moves.
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Canada's Real Debt is 2 Trillion or 131% of GDP

An eerie calm fell over Canada’s financial markets one year ago. Battered by collapsing equity markets worldwide, and further hampered by falling commodity prices, the Canadian economy ground to a screeching halt. A decade of growth fueled by expanding debt was about to be unwound. Or so it seemed. However, into the breach stepped the Canadian government with a stimulus program of mammoth proportion. Though dormant in the spring, by the summer we saw a few green shoots emerge. And by the autumn of 2009 we began to harvest debt-fueled growth in this country once again.

This post does not quibble with the growth we see. It is there for all to observe. If we dare to ask a question it is only regarding the less studied subject of the durability of a rebound built on government largesse. Simply put, does the Canadian government have the borrowing capacity to keep on priming the pump?
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Rogers Communications lays off 900 managers
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Dubai: 19 Billion Loss Coming For European Banks Investors in Shock

Note: The Dubai collapse has been mentioned many times on this blog since July 2009, so this is old news. Here AND HERE

LONDON (MarketWatch) -- Analysts at Credit Suisse estimated Thursday that European banks they cover could have exposure of around 13 billion euros ($19.6 billion) to Dubai. The broker said a 50% loss on the exposure would be equivalent to around a 5% increase in provisions in 2010 or a hit of around 5 billion euros after tax for the European banking sector as a whole. Analysts cautioned that the numbers are difficult to quantify and exposures will differ from one bank to another.
LINK HERE

Investors in Shock
LINK HERE