FedUpUSA

Archive for the ‘Christmas’ Category

Naw, really?

U.S. holiday sales growth slowed by more than half this year after gridlock in Washington soured consumers’ moods and Hurricane Sandy disrupted shopping, MasterCard Advisors SpendingPulse said.

Retail sales grew by 0.7 percent from Oct. 28 through Dec. 24, the Purchase, New York, research firm said today, without providing a dollar figure in the billions. Sales grew at a 2 percent pace in the same period a year ago. SpendingPulse tracks total U.S. sales at stores and online via all payment forms.

Sandy?  Really?

Give me a break.  I’ve been watching the data all season and saying that I didn’t buy the “strong” or even “reasonably strong” predictions.  This is actually a net-negative report when you include price changes; the data reported is not inflation-adjusted.

One of the amusing parts of this report is that it’s real-time data from retailer card-processing terminals.  This contrasts with the government “personal income and spending” numbers, along with the retail sales “reports” from various self-interested groups like the National Retail Federation, which are estimates.

Those numbers showed material growth.

The real world says they lied.

Don’t believe the folks like the NRF and other folks who refuse to cite their sources and claim to run “surveys.”  This is the real deal as it’s off real data coming from real check stands.

It was Grinchmas.

It’s time we freed ourselves from needless stuff, needless calories, needless spending, needless guilt and needless derangement.

My Mom, bless her heart, drove a stake through the guilt-ridden, retail-riot needless-gift Christmas madness: ”Let’s not exchange gifts this year–none of us need more stuff or calories.” Done! We are having a gift-free party, where the “gifts” will be the experience of conviviality and the memories.

No matter how “small” the gifts may be, the guilt-soaked onus to buy something, anything for everyone in the family/enterprise is deranging. What most households need is not more stuff but someone to haul stuff away.

Is Anybody Else Tired of Buying and Owning Stuff? (September 7, 2012). The real gift to loved ones would be freeing them of stuff they no longer use.

We as a nation are awash in stuff. Dumpsters are crammed with perfectly good food (an estimated 40% of food in America is thrown out), perfectly good electronics, still usable furniture, and on and on.

As for candy, confections, cakes, etc.–as Mom said, none of us need more sugar-fat calories. If we do give sweets this year, they will be homemade so we can use real ingredients and cut the sugar used in the recipe. We can also trim the portion sizes. Less is better in so many ways.

Part of the guilt of Christmas is the constantly repeated message that our economy will collapse if people don’t buy more stuff on credit, even if the stuff is needless. Please, Santa, Let This Be the Last Christmas in America (that’s supposed to “save” the U.S. economy) (November 23, 2010). Recall that holiday retail sales are a mere 3.4% of the U.S. GDP.

Well guess what, America–if your economy is based on buying useless stuff on credit, then it shouldcollapse, and the sooner the better, because there is another, better way to live: without credit, and without needless stuff.

In a largely loveless, technology-distracted, burned-out society, then the guilt of self-absorbed emotional miserliness drives us to salvage an expression of caring from a needless gift. Too busy to actually listen to your kids? Lavish them with a gift. Ditto your parents, colleagues, etc.

If time is the ultimate gift, then what better gift than time spent together enjoying a home-cooked meal or other conviviality?

Yes, children expect multiple gifts, even if their rooms are already warehouses of consumerism, and a gift may be expected in certain business settings. But is there no other way to express caring than a frantically purchased retail-riot gift? How about sharing some item that is somebody else’s surplus? This is now a business model: yerdle – why shop when you can share? “Sharing is more fun than shopping.”

If you are in a position of responsibility, then how about ending the gift-exchange charade in your enterprise/division? Or if you face a full-blown rebellion in the family or company, then why not place a $5 limit on all gifts? Or require the gifts be home-made, or consumable?

If you must give gifts, then how about making them useful tools? This is the idea behind our list of practical kitchen tools: Favorite Practical Kitchen Tools (All Under $23, many under $10, most made in U.S.A.): if you feel you must give a gift, or want to help stock a new household’s kitchen, then for goodness sakes, give something that is useful on a daily basis, not an electric pasta maker (or equivalent) that collects dust in a closet until the owner moves or has a garage/jumble sale.

Yes, we will give a few gifts to children, friends and key clients; but the gifts will be small, handmade or consumable. It’s time we freed ourselves from needless stuff, needless calories, needless spending, needless guilt and needless derangement.

Charles Hugh Smith – Of Two Minds

The end of debt-based affluence: welcome to The Last Christmas in America (TLCIA).

Almost 35 years ago, as unemployment rose toward 10%, the January 1975 cover of Ramparts  magazine blared: The End of Affluence: The Last Christmas in America.(TLCIA)

The article wasn’t referring to the religious celebration; it was referring to the postwar concept of Christmas as the frenzied, exhausting  year-end pinnacle of our one true secular faith, Consumption, a final orgy of   buying and binging.

It is instructive to recall how the Federal government responded  to unemployment, high inflation and rising  budget deficits in the early 1970s: it began fudging numbers, manipulating data to mask the politically inconvenient realities of rising inflation, unemployment and deficits by playing switcheroo with Social Security Trust Funds, inflation data, etc.–games it continues to play in 2011 to cloak reality from the media-numbed public.

The market was not so easily fooled. The Bear market, reflecting the “real”  recession, lasted 16 years, from 1967 to 1982. Now statistics are echoing that last great recession: rising prices for essentials, systemically high unemployment and stagnant wages while the corporate media and the organs of statistical manipulation (a.k.a. the sprawling, putrid public-private cesspool of the Ministry of Propaganda) trumpet “the return of growth” and skyrocketing corporate profits.

(Today’s propaganda:housing starts blip up due to statistical noise, and though starts are less than half pre-recession levels, this is heralded as “evidence” that “strong growth is back.”)

The difference between the postwar boom of 1946 and the boom that followed 1982 is the last boom was based on the explosive expansion of debt.People didn’t save and invest in productive assets; they went into debt to consume more and to become a “bigger” persona via the miracle of credit.

I often use this chart to make this point: if credit had expanded along with GDP, then we’d be considerably less indebted.  Instead, it required a vast expansion of debt–some $30 trillion more than the rise in GDP–to fuel the 1982-2000 boom.

A funny thing happens when you depend on expanding debt to fund your consumption:eventually the cost of servicing your rising debt reaches the limit of your income, and you can’t borrow any more, unless interest rates decline so you can leverage your income into higher debt.

Here’s a chart of household debt: that little reversal in debt expansion sent the economy into a tailspin.

Lowering interest rates extends the era of debt-based consumption, but it only puts off the inevitable crash when the ability to borrow runs out. Eventually the cost of servicing this lower-interest debt absorbs all your disposable income, and the borrowing skids to an abrupt stop.

Two other bad things can make this dominance of debt servicing worse:your income can decline, and the value of your assets can decline.  In this unfortunate situation, you’re ability to service your existing debts is crimped by a loss of disposable income, and you’re paying for assets whose worth has fallen below the  debt taken on to buy the assets.

Income has declined significantly in the wake of the 2008 crisis/recession:

And here’s the key asset of the middle class, housing:

This double-whammy of lower income and lower asset valuations is exactly where we are now.This is why the Fed’s campaign to lower interest rates to zero and make it easy to borrow more have been as successful as pushing on a string; the economy is choking on over-indebtedness and overleveraging of stagnating income. There is no escape from this vortex except refusing more debt and writing off existing debt, wiping it off the balance sheets as an asset, driving lenders, banks and those holding debt as assets into insolvency.

As we saw yesterday, the velocityof money–that is, money actually being borrowed and spent or invested in the real economy–has plummeted to zero.

We all know the 16-year recession/malaise back in 1967-1982 had a “happy ending”:  huge new oil fields were discovered in Alaska, the North Sea, West Africa and elsewhere, ushering in a renewed era of cheap, abundant petroleum. President Reagan “saved” Social Security for a generation by raising contributions paid by employer and employees, and he heralded a “lower taxes, higher permanent deficits” ideology that is now accepted as the norm: deficits don’t matter, even when they reach the trillions, because our good friends the Gulf Oil Exporters and Asian exporters will buy all our debt forever, keeping interest low forever.

(And if they drop the ball, then the Federal Reserve will print money and buy the Treasury bonds. Sweet! We don’t need any external buyers, just the  Federal Reserve.)

Then the U.S. created and launched two revolutionary technologies which both created new wealth around the globe: the personal computer (microprocessor and cheap RAM) and the Internet (TCP/IP, Ethernet, and the commercialization of Tim Berners-Lee’s World Wide Web with free browsers) spawning the generation-long boom of the 1980s and 90s.

Beneath the surface of this innovation-driven boom, however, the real engine of growth was debt and the financialization and globalization of the economy.

But when the wheels fell off that debt-fueled boom in 2000, the U.S. did not create a new engine of wealth: it opted instead for a devilishly insidious simulacrum of wealth: debt which rose at an exponential rate throughout the economy.

Borrowed money and phony financial legerdemain (mortgage-backed securities, derivatives based on the MBS, etc. etc.) from 2000-2007 created what I have  termed a “bogus prosperity”: no actual new wealth was created, only a brief and doomed bubble of debt-based housing valuations was inflated which followed the classic model set down by the Tulip Craze in Holland hundreds of years ago: insane boom, crushing bust.

We have to revisit the early 1970s for a reality check.  In post-industrial America circa 1970, a huge surplus of food was grown by a mere 2%  of the workforce. The cornucopia of manufactured goods was produced by about 20% of  the workforce (hence the phrase “post-industrial”), and other than essential government services like the Armed Forces, police and the courts, the rest of society’s work was either service-oriented paper-pushing relating to affluence (insurance), do-good selfless work (Peace Corps, churches) or leisure-related: entertainment, films, travel, amusement parks, stereos, etc.

This was not all fantasy.A friend of mine supported an entire  house of hippies in  late-60s Pittsburgh on his union steelworker job, and had plenty of money left to save for his trip to San Francisco. (As I recall, the rent for the big old house was less than $200 per month.) Hippies were the first ardent dumpster-divers/scavengers, driven not by poverty but by the idea that since that our society generated so much waste and surplus, why bother working?

As noted here many times before, the purchasing power of American wage-earners reached a plateau around 1973 and has been declining ever since.

One key point which is usually overlooked when comparing “The Last Christmas in America” circa 1974 and TLCIA circa 2011: the wealth distribution in the U.S. was much flatter then.CEOs of financial institutions did not earn $10 million each; there were no hedge funds with chiefs pulling down $600 million each (yes, that was the average “compensation” for the top ten fund managers at the hedgies’ glorious peak), and even minimum wage ($1.60/hour in the late 60s, I know because my wage stub recorded it) bought far more goods (purchasing power) then than minimum wage does now.

Not only was gasoline cheap, but housing was far and away cheaper than it is today. Just about any G.I./Vet could buy a house with his/her V.A. benefits (3% down), and anyone else could scrimp and save for a few years and then buy a house for 2 or 3 times their annual wage at an interest rate around 6%.

Meanwhile, in TLCIA circa 2011, obscene “compensation packages” are defended as “free enterprise.” Well, what did we have in 1973? Unfree enterprise?Amidst all the ideologically convenient defenses of heavily skewed “compensation,” we have to admit that the dream of affluence combined with leisure was based on the presumption of society’s wealth being distributed somewhat evenly, not by a Communist central state but by the “free enterprise” system and modest common-sense government regulation  (limited work hours,  minimum wage, etc.) which protected employees from the excessive exploitation of the late 19th century and early 20th century Monopoly Capitalists.

That dream seemed at hand in 1970. Now, after “the limits to growth” were mocked by those expecting ever larger oil fields to provide endless abundant cheap oil, we find that Peak Oil was merely put off a generation; there have been no new discoveries of super-massive oil fields since the early 1970s, and the supposedly abundant alternative petroleum sources like shale oil are horrendously costly to exploit, for they require vast quantities of energy (mostly natural gas at the moment) to be consumed to extract the oil.

Now we face a future which might well be called the End of Work for up to a third of the current workforce.Since agriculture employs about 2% of the workforce, industrial/factory production about 11%, essential transportation and essential government each a bit more, we have to ask: in an economy in which 70% of GDP is consumer spending, how many jobs are actually essential? How much actual wealth is being created/produced in the U.S. and sold overseas? Is giving people with Medicare coverage handfuls of costly and often ineffective medications and endless MRI  tests actually creating wealth, or it mostly squandering it?

We might also ask: how much of the consumer economy is superfluous if wage-earners shift values and decide saving is more important than consuming? How many malls, storefronts, internet retailers, restaurants, fast-food joints, etc. can a newly-frugal economy support?  How many dog-walkers, derivative salespeople, nail shops, carpenters, financial planners, realtors, etc. does an economy need if the FIRE economy (finance, insurance and real estate) is shrinking?

Based on the tremendous size of the service economy, construction, finance and government, I have estimated that 30 million jobs out of the current 139 million-strong workforce are superfluous.  Many government positions are essential: police, meat inspectors, rangers, tax collectors, meter maids, etc., but as Mish so thoroughly illustrated in his detailed analysis of the California state budget ($120 billion or so), dozens of State agencies could be eliminated without any visible effect on the economy except to the wage-earners who lost their jobs.

If 20 million jobs disappear (7 million have already vanished since 2008), so do all the taxes  those wage-earners paid; if 5 million homes go through foreclosure, the inflated property taxes the owners once paid will disappear, too. Once businesses close, it’s not just wages which disappear: all the junk-fees governments levy disappear, too: the business taxes, the licensing fees, the permits, transaction fees, etc.

Does anyone think all these taxes and levies can fall and government employment will be funded by some other source?  Yes, the Federal government can borrow apparently limitless sums  at low interest rates; but soon, the surplus money which has piled up in exporters’ accounts will be gone, and the  endless borrowed trillions will actually start costing real money–money that will be diverted from government employment to pay the interest on all that wonderful debt everyone loved when they got a piece of it.

So how does a society deal with the End of Debt-Driven Consumerism, the End of Cheap Oil  and the End of Work when it also means The End of Affluence, even for many of those with jobs?  How does government deal with declining tax revenues and rising interest rates?

The death throes of the debt-based consumerist lifestyle are already visible beneath the glossy propaganda of “rising revenues this Christmas season.” Those revenues were obtained by selling goods at below cost, in the absurd hope that income-strapped, over-indebted consumers would make profitable “impulse buys.” As Mish has documented, the “impulse buys” are being returned even before Christmas to the tune of hundreds of millions of dollars.

The Fed is desperately attempting to re-inflate the debt bubble by lowering interest and mortgage rates and buying up all sorts of semi-toxic/impaired  debt. What the Fed dreads is the reality we all feel and see: fear of the future  due to diminished wealth and insecure incomes.If your assets have fallen in value,  you feel poorer because you are poorer. Borrowing more at any interest rate will not make anyone feel wealthier.

People who fear their income may plummet due to layoffs or their hours being cut are not in the euphoric mood to borrow more, and banks which cannot dare to lose more money loaning to people who will default have cut off credit to millions of  previously rabid consumers of debt.

Ask yourself this simple question: how much stuff could people buy if they could only spend surplus cash, after all their expenses and debt servicing payments were paid in full?

And let’s not forget that much of what is purchased in this consumerist frenzy is needless, superfluous crap.  My wife saves the most egregiously gift-buying-frenzy advertising circulars, and one from Bed, Bath & Beyond caught my eye.

There is no difference between this “1001 Best Gifts” from BB&B and a parody of consumerist excess.Hmm, how about an “executive standing valet” rack of wood and plastic for $99.99?

To make this poor-quality contraption, a forest somewhere in a Third-World kleptocracy  was cut down and precious, irreplaceable oil was burned shipping the lumber to China and from that factory to the U.S. across 6,000 miles of Pacific Ocean.

We know this spindly piece of garbage will break in a matter of days, weeks or maybe if the owner is especially careful, months; then the legs will break loose of the base, the towel bar will pull out, etc. and the “we cut down a priceless rain forest to make this” piece of human handiwork will be put on the curb where a diesel-burning garbage truck will haul it to the landfill along with all the spoiled food Americans throw out.

The 16-bottle wine cellar/cooler from China (labeled Cuisinart for your consuming pleasure) for $199.99 might come in handy storing something once it’s unplugged–but a cardboard box will probably do just as well.

I for one will not mourn the last debt-consumerist Christmas in America. Good riddance to the flaunting of borrowed money and the heedless, desperate purchase of valueless “goods” as gifts for an insolvent nation awash in too much of everything but common sense, integrity, gratitude, accountability and healthy living.

Charles Hugh Smith – Of Two Minds

So as I sit here waiting for my pie crust to chill so it can be rolled out, and prepare to stick my extremist pumpkin pie and extremist turkey breast in the oven, along with all the other fixings that I’m preparing for dinner today, I thought I’d muse a bit on what we should hope for out of our CHRISTmas this year.

Hope, of course, is one of the three things that all organized religion attempts to teach.  The other two are faith and love.  But do we really find them in organized religion – of any stripe? 

There have been many times over my life that I’ve doubted the existence of God.  But never more than in the last few years, as the trappings of what our nation began with, The Constitution, drawn by a few dozen wise men, guided by provenance, has been systematically shredded into confetti and used for toilet paper.

To be sure this is not exactly a new thing.  Our tripartite system of checks and balances was utterly trashed in days gone by, with two of the most-egregious examples being FDR’s attempt to pack the Supreme Court and the introduction and passage of the 17th Amendment, which instantly and permanently eviscerated the 10th Amendment – part of the grand bargain by the colonies for the adoption of The Constitution in the first place.

Indeed, if one looks back through the outrages of Federal Government expansion, you’ll find they pretty much began with the 17th Amendment, and the reason is clear: Its passage removed the ability of The States to block federal legislation.

Yet that fundamental construct – a modest and weak federal government and a comparatively strong set of state governments, is exactly what all those in our nation signed up for roughly 235 years ago.  The Constitution is in fact a contract – but like all contracts, it is only as good as the willingness of the parties to enforce it.

Liberals of all stripes talk incessantly about “The living Constitution.”  That, of course, is a crock.  The Constitution is a set of black letters arranged on a very-dead tree.  Yet it is not inflexible – the means to amend it to suit the needs of the day is embedded within.  For better or worse that path was allowed, and in some cases, such as the 17th Amendment, I argue we so amended it foolishly, in the heat of political “wedge issue” arguments that in fact date back to the founding of politics itself.  Yet when a liberal wants something he can’t have under The Constitution he typically ignores the constraint - such as those who argue that the black letter language of The Second Amendment means that only ”The National Guard” has the right to bear arms never mind that The Constitution was drawn when “The National Guard” was comprised of every able-bodied man, keeping and bearing his own arms suitable for military purpose (which most-certainly include rifles and handguns), whether organized into military units or keeping their own homes and land safe from potential – and actual - marauders.  Such a force comprised of all citizens willing to bear their own arms in what we now call The United States in fact dates back more than 370 years, to the 1630s!  In 1903 the “organized” role of the National Guard was subsumed into the Army Reserve force, where it remains.  But the original militia envisioned by the founders did not (of course) disappear – it remains in the form of every citizen willing and able to bear arms in defense of the nation, of the state, and of him or herself.  It’s just inconvenient to acknowledge that fact when you’ve got a particular agenda you want to pursue – like Statist or even Marxist control of the people.  How soon we forget that one of Hitler’s first acts was to disarm the population, and that this almost-certainly made possible mass-murder of Jews and dissidents.  In short, The Left keeps some damn strange bedfellows.

Conservatives of all stripes talk incessantly about “The Rule of Law.”  That too is a crock, considering that The Rule of Law most-certainly includes all of The Bill of Rights – not just the parts congruent with what they want to do if and when convenient.  The Constitution provides, among other things, that in all matters of controversy that exceed $25 in value, and for all criminal offenses no matter how petty, you have a right to trial by jury.  Try to assert that right for a traffic offense carrying a $200 fine and see how quickly you’re ruled against.  The 4th Amendment prohibits searches and seizures without a warrant specifying probable cause and the specific item(s) to be searched for and seized under that probable cause, yet I don’t recall the last time I saw an alleged Conservative actually demand that all of the illegal searches and seizures that take place every day in this country cease.  The Constitution also provides for explicit equal protection under the law, yet we have a multitude of Statutes that explicitly violate same, not to mention blatant refusal to prosecute black-letter crimes – even admitted crimes – when the criminal is some powerful institution like a bank.  The Right keeps some damn strange bedfellows too, when one considers the admitted and alleged crimes involved - organized tax fraud, breaking and entering, burglary, theft, money laundering in support of drug running and terrorism - to name just a few.

We have Statutes that are wantonly and willfully violated without recourse every single day.  One such example is The Federal Reserve Act which explicitly mandates price stability.  Those two words are clear and bear no interpretation or argument.  Yet Ben Bernanke and those who have come before him have continued to hold the office while asserting that “2% inflation annualized” meets the mandate.  Really?  In 1776 an 8th grade education was sufficient for anyone to know that over a mere 50 years such a mandate would result in the devaluation of saved capital by 63%, and over 100 years, almost the duration of The Federal Reserve to date, it would result in an 86% devaluation.  Never mind that the actual rate has been closer to 3%, resulting in a devaluation of about 95% over that time. Such is the nature of compound functions.  How this sort of thing comports with the word “stable” is beyond anyone with an IQ larger than their shoe size. 

That we, the people, have and do permit this is proof positive that our shoe size exceeds our intellect.

Then we have so-called “Security Apparatus” such as the TSA.  A pilot was recently “disciplined” for disclosing via videos what I’ve talked about repeatedly since 2001 – The TSA provides no security of meaning at all.  Proof of this is found in the fact that airport employees simply go through a card-reader door to get to “sterile” areas of the airport and are not searched on the way in – or the way out.  This, of course, leaves a wide-open path for someone to either impersonate a worker (trivial if all you need to do is duplicate or steal his access card) – or bribe him or her.

A baggage screener was arrested in 2008 for stealing more than $200,000 worth of electronics from the pass-through X-ray belt that your carry-ons go through.  She was caught when she allegedly stole a camera belonging to CNN, which they found listed on eBAY for resale.  Oops.  Nor was this the only incident of this type - as of 2008, 465 ”officers” have been fired for theft.   Left unsaid, of course, is that if I can steal something from your bag I can put something in it too, and that “something” might be a bomb.

Then there’s the fact that just a few days ago a man accidentally carried on a handgun – it went right through the security check at the airport X-ray machine.  It wasn’t a little gun either – it was a .40 pistol!  Experts tell us that the “fail” rate to catch weapons carried on approaches and in some cases exceeds 70%.  Are these people sleeping at the monitor?  Again, if that’s the “accidental” failure rate how hard is it to bribe one of the men or women watching that X-ray machine at an “appropriate” time if you have nefarious intent? 

We’re told that we should “submit” to full-body X-rays which will do nothing about this problem, since a carry-on bag isn’t, of course, on your person.  And we continue to accept that the “underwear nut-burner” would have been “caught” with such screening even when 70% of the time guns, which are a hell of a lot easier to spot than a splotch of explosives splayed around one’s genitals, are missed by people using the same technology at much higher power levels and resolution with your carry-on bags and despite the fact that the crotch-bomber was walked around security and check-in formalities by someone – therefore, scanner or not, competent operator or not, he would not have been caught by it!

The truth is this: While there are plenty of terrorists nearly all of them are cowards.  Oh sure, they’ll try to send a bomb in a toner cartridge from Yemen (exactly how many toner cartridges are manufactured in Yemen, may I ask?) while they sit on the ground chortling at their grand attempt to blow a plane up.  There are terrorists who will pack a van full of what they think are explosives and park it near a Christmas Tree lighting ceremony, intending to kill dozens if not hundreds of people, including children, by remote control using a cell phone while safely beyond the expected blast radius.

There are damn few terrorists, and most of them seem to have an IQ well below room-temperature, who are willing to die in the commission of their intended act.  This appears to be a matter of innate wiring of the human brain, and is a good thing.

But in our mass-hysteria we allow “Big Sis” to tell us that a risk that is 100 times less likely to result in our injury or death than the simple drive to the airport to catch our flight suddenly requires that we forget that the 4th Amendment to The Constitution exists.  Never mind that nearly all of the arrests and prosecutions that the TSA manages to actually commence (despite their bungling success ratio) have nothing whatsoever to do with airline security – the arrestees are, by and large, busted for things such as drugs. 

Isn’t it funny how the “Security Theater” game, complete with entirely-inept employees that can’t detect a gun 70% of the time in a carry-on bag, thereby rendering them in my opinion unfit to ask “would you like fries with that”, manages to get us to give up one of our fundamental rights by waving around a risk that is documented to be 100 times less likely to kill you than the drive to the airport?

Who’s the dummy when our collective IQ is so low that we fail to detect and refuse to accede to this obvious and intentional lie?

So as we celebrate CHRISTmas this year, let us pray that should God actually be out there that we not receive material gifts under our tree, or even the love of our fellow man.

No, let us pray that the New Year brings a sense of outrage.  A demand for justice.  A bent to prosecute, not loot.  A demand that each and every of our Constitutional Rights be respected and that those who try to abrogate them be ejected from public service and jailed.  That we become a people unwilling to sit still and twiddle our thumbs (or other bodily parts) while the roughly 6% of our population that is psychotic and malevolent strips the productive people and assets of this nation to the bone, then throws what’s left into our own funeral pyre and uses what’s left of The Constitution to ignite it.

We have the ability to demand that these acts stop and that those who committed them in the past, throwing people from their homes, blowing serial asset bubbles through lies and obfuscations, stealing through misrepresentation and fraud or making promises that were known to be fundamentally unsound and impossible to keep be identified in public, indicted, prosecuted and imprisoned.

We, the people, can take this nation back.

It is within our power.

We only need the will, and the Grace of God, to do so.

If you and your family are blessed and prosperous this holiday season, you should consider yourself to be very fortunate, because there are tens of millions of other Americans that are desperately hanging on by their fingernails.  The Christmas stories that you are going to read below aren’t going to give you any warm fuzzies.  They aren’t about “Santa Claus” sliding down the chimney to leave huge piles of presents around the tree.  Rather, they are representative of what so many American families are feeling this holiday season – horrible, suffocating, soul-crushing despair.  As you and your family gather around the holiday tree on December 25th, millions of other Americans will be facing a Christmas with absolutely no gifts.  As you and your family dig into a delicious holiday meal, millions of other Americans will be breaking out the meager supplies they picked up at the food bank or that their food stamps have enabled them to purchase.  As you and your family tell stories around the fire, millions of other Americans will literally sit shivering in their own homes because they have no money to heat them.  The stories of those who are suffering so deeply very rarely get put on television, but that doesn’t mean that they aren’t very real.

The truth is that there are millions upon millions of American families that have been pushed to the edge of despair by the lack of jobs.  In August 2009, only 10 percent of the unemployed had been out of work for 2 years or longer.  Today that number is up to 35 percent.

One very disturbing sign of the times is that many churches are now holding “blue Christmas” services to comfort those who are going through hard times.  Back during the “good times” such a thing would have been unimaginable, but now they are being held from coast to coast.

All over the nation, food banks, aid agencies and homeless shelters find themselves absolutely overwhelmed this winter.  Connie Lassandro, Nassau County’s director of Housing and Homeless Services, recently was quoted in the Huffington Post as saying that she has never seen a greater demand for her agency’s services….

“The new faces we’re seeing are families who have never before faced the risk of actually being homeless. Children don’t understand. ‘Where’s my bedroom? Where’s my toys? Where are my friends?’”

Sadly, the truth is that the U.S. economy no longer produces even close to enough jobs for everyone, so somebody is going to suffer.  Today, there are over 6 million Americans that have been unemployed for half a year or longer.  It can be really easy to quote economic statistics such as this, but sometimes what gets lost in all the numbers are the very real stories of the people that are actually living through all of this.  This year there are literally millions of American families that have sad Christmas stories to share.

On The American Dream blog, a reader of my column identified as “momma loses hope” recently left a comment in which she really opened up and shared her story with us. Sadly, her story is so similar to what so many millions of other young American families are going through this holiday season….

While my husband has experience, and an education, he is yet to find and keep a job that is worth anything, that would be possible to pay back these $400/mnth loans on deferment, let alone keep us going barely.

Despite his greatest effort and attempts, to locate work that would pay anything over $10 an hour in the field he trained for, or some cross over skills in another profession, still nothing has been happening beyond numerous and then dwindling interviews in the last 2 years.

He is currently working at a $10/hr people mill that has outrageous expectations that are near impossible to meet, just to keep your job. Much of what you are supposed to control, is not within your control! That was after having lost unemployment due to its exhaustion, where we had nothing coming in for 30 days. He found this job and went through training. We were thankful to have anything coming in, but it is not going well. Half of his training class is gone either bc they quit or were fired. We are finding out this is the normal for this business.

Prior to the unemployment of 99 weeks, he had a great new job. $60 k a year was good from having some on the job experience at another job prior to that which was an internship, he got. So this was a good option for a chance out of school. They were content with his level of experience of 3- 4 years in IT w/ the hands on education and internship. We moved to relocate for this job 2500 miles away and then he was let go 6 months later, after he was able to clean up a bunch of unresolved problems for them. They wanted someone with 10 years of experience, all the sudden, despite they knew his skill level! Anyhow, the network was held together with tape and bubble gum. So long “best practice” theory.

I guess they had been left in the lurch bc someone left without notice, they advertised for help for months even out of state, and then they hired my husband to fill the desperate gap. Then they didn’t want to keep shelling out the money to keep him. Used him and turned us away, like no big deal; They fired him after 6 months, after we spent all our savings to move to another state… That is when we went on unemployment, and hubby returned for more education, while still looking for a job too.

We moved back home confused as could be. We were helpful that something would come along back home. Things only got worse for the prospect of careers being offered.

I was hoping they were going to improve, but no they have not. We are dying here. But that is not the end of our troubles.

Last year my husband got a $10 a hour job, got H1N1 and Dble Pneumonia and went to the hospital for 14 days or whatever. He was fired by Stream for not being in training and they refused to place him in another training class when he got out the ICU. Then we were left with over $10,000 ( the other $90 grand was forgiven) and we have collectors after us. We survive day by day, we don’t have anything extra to pay anyone or anything….

So, we don’t have any savings,( we used it to relocate to gain employment as I already mentioned) & we have needed things bc we have a baby coming. We haven’t made it long enough to get anything else saved up to rely on, bc unemployment doesn’t pay you what you were making at your job. The unemployment is gone and there is none left, if he loses this job. We don’t qualify for anymore student loans at this stage. This job is shaky at best and these people fire and lose people like there is no tomorrow, and have constant training going on. What a nightmare! We are not able to get a career in the IT Industry that he trained for and paid for with these loans. What do we do? We have a 6 year old and a baby that is on the way in 3 months.

We are so lost and without hope. We trust in Jesus, but what do we do beyond trying to get a better job? It takes effort to gain a job, but there are not enough possiblities hiring as this article states, and I testify to. All my husband does beyond going to this crap job, and playing with our son, is scouring the internet for jobs, and this has been going on for so long!….

I can’t believe this is happening again…..What is a mother and wife to do? We can’t get on track! We don’t drink or drug or sabotage ourselves and our family, and yet we cannot get on track “with the go to school and get a great job” crap I have heard my whole life. Something is broken and cannot be fixed. Sometimes we wonder why God hadn’t just taken my husband’s life when it was in peril and the rest of our family, as it would be better than dealing with this pain and unresolved heartache.

I am so scared and lonely, I could just die. My tears go unnoticed. I sit here without answers. I am one of millions going through the same thing.

Can you imagine being in such a situation?  What is perhaps saddest of all is what this economy is doing to so many children.  According to one recent study, approximately 21 percent of all children in the United States are living below the poverty line in 2010 - the highest rate in 20 years.

Poverty is absolutely exploding all over the United States.  The number of Americans living in poverty has increased for three consecutive years, and the 43.6 million poor Americans in 2009 was the highest number that the U.S. Census Bureau has ever recorded in 51 years of record-keeping.

So, no, this Christmas is not “a season of joy” for many Americans.  For example, a commenter on the Unemployed-Friends website identified only as “jobless_in_MA” says that her holidays are going to be quite depressing since she has been out of work for 2 Christmases in a row now….

Well, this is now my 2nd Holiday season in a row being jobless, and this year seems far bleaker than last years. Ive always been the type to love this time of they year. I would look forward to it. I was always the one in the family who would be the great gift giver, especially to the younger members of my family.

Last year I was REALLY upset because I couldn’t do 1/4 of what I normally would do, but still managed to enjoy the season. Im not so sure about it this year.

A lot has happened to my situation in the past year, Ive lost my place, filed bankruptcy, lost some of my dignity, and my marriage is on the rocks.

I am NOT in the holiday season at all, and its really bringing me down.

Usually around now we would be talking about getting a tree. Sometimes we would cut our own tree down, and decorate it together.

We would always have a family holiday party at our place, and I don’t see that happening this year at all.

Yes, every year there are some Americans that are “down and out”, but it is undeniable that the number of Americans that are suffering extreme economic pain has absolutely skyrocketed in recent years.  Today, one out of every six Americans is now enrolled in a federal anti-poverty program.  As 2007 began, “only” 26 million Americans were on food stamps, but now 42 million Americans are enrolled in the food stamp program and that number keeps rising every single month.

Sadly, there are millions upon millions of Americans that do have jobs and yet barely find themselves able to hang in there.  Many Americans have been forced to grab whatever job they can find.  In fact, the number of Americans working part-time jobs “for economic reasons” is now the highest it has been in at least five decades.

It is becoming increasingly more difficult to make a living in the United States.  Today, half of all American workers earn $505 or less per week.

Could your family get by on $505 per week?

That is something to really think about.

So is anyone doing well?

Well, the only group that saw their household incomes increase in 2009 was those making $180,000 or more.

Not that being wealthy is a bad thing, but what that statistic shows is that the middle class in America is being wiped out.

We are seeing this in community after community across the nation.  A reader of this column identified as “Bibi” recently left a comment that did a great job of describing the economic decline and economic despair that we are now seeing all across America….

I have recently traveled from coast to coast and then some. This is a synopsis of what is really going on.

Californians seem to be in lalaland. Look good and spend money, lots of it that you don’t have. LA has become very dangerous. Police will knock on your van if you stop to rest with a coffee even if you are at a convenience store. It is illegal to sleep in your vehicle and you will be arrested.

Las Vegas is full of poor and homeless wandering around aimlessly. Tent cities and blocks of people living on the streets. dirty and super dangerous. The decline is in your face. Police and security presence are at ‘ad nauseum’ levels.

AZ and NM are ****holes. My family refused to get out of the van in Albuquerque. Sedona is still nice but its surrondings make it on borrowed time. Little artsy towns will be taken over quickly when TSHTF.

The only city I went to in TX was Amarillo. Didn’t see much but it looked seedy and dirty along the highway.

OKlahoma- ***. If I didn’t stay on a military base, I would have broke the speed limit to get through it.

The thought of getting gas in Little Rock still gives me nightmares. Enough said. AK- Lots of boarded up towns. Saw this all along Route 40.

TN- Stay away from Memphis if you want to live. Nashville is the craziest city I have ever seen. Everyone acts like they are on speed. When you get around Pigeon Forge, Maggie Valley and Gatlinburg, you see the true beauty of this state but they are tourist traps.

W. VA is beautiful, but the people are very backward. I could live in Northern W. VA.

East coast- VA. Beach has been in decline and was just dubbed the “most drunken city in the U.S.” They must be proud. Lots of trouble here. Big police presence. Took 10 minutes for me to get questioned about my out-of- state plates.

N&S Carolina- Bigger cities are dangerous, especially Columbia, SC. Big police presence. Baltimore- be afraid, be very afraid. Keep going.

NJ- Something like a horror movie. Do people really live here? Scary and smelly.

NYC- Was advised by thruway attendent to “keep going and don’t stop” Overturned cars, tons of high rise ghettos, not a safe place. I was terrified my van would break down.

Albany, NY.- my destination. Ghettopolis. Stopped by police within minutes as to why I was driving in city so late. ? Informed it was not safe. Stopped again the next day regarding my plates at a police check. They threatened to tow my van because my “license didn’t come up”. [he was holding it] Stopped again for seatbelt violation. I always wear it but he said he couldn’t see it. Am I imagining it or did I really see National Guard walking around with rifles? Well, I promply left NYS and will never go back.

The Florida panhandle is far from perfect and has an ever expanding police force, but it is quiet. Not safe, but quiet.

Once upon a time, there were a few cities and towns around the U.S. that were obviously in a state of decline, but now it is happening everywhere.

In fact, there are many areas throughout the country that scream “economic despair” the moment you drive into them.  It is almost as if someone has sucked the life right out of them.

So why is this happening?  Well, as I recently pointed out, America’s economic pie is rapidly shrinking.  As our national wealth continues to be destroyed, even more American families are going to suffer.

For decades we have enjoyed a debt-fueled binge of prosperity that was unlike anything the world has ever seen.  But now the day of reckoning is fast approaching and things are going to get even worse.

So if you are doing really well this holiday season, be thankful, because next year it may be you that has the sad Christmas story.

The Economic Collapse

Looking for the reason behind soaring apparel sales and weak sales at Best Buy? You can find an explanation in Sad Santa Letters that the United States Post Office opens a reads as part of “Operation Santa”.

With just nine days to go until Santa shimmies down those chimneys, letters to the big, jolly guy are coming in fast and furious. “The common theme this year seems to be a single mom with young kids, the parent has left — they don’t know who the father is, or the father left — and they can’t pay the bills,” said Pete Fontana, head of the United States Postal Service Operation Santa in New York.

“We had one little girl write in and say all she wants is a winter coat for her mom. Nothing for herself,” he said. “We had another letter for grandparents and they wanted to put a turkey with the trimmings for the holiday dinner … but they couldn’t even get their medicine.”

Other letters are similarly heartbreaking.

Eight-year-old Skayla told Santa that her mother doesn’t have a job and her father lives in the Dominican Republic, leaving it up to her grandmother to buy everything. She asked for clothes and shoes for herself, her 7-year-old sister and their infant brother, even including their sizes.

“Thanks Santa,” she wrote,” I LOVE YOU.”

How You Can Help

If you want to help make a Christmas wish come true, the best way is to Contact a local post office participating in Operation Santa.

Industrywide Demand for Electronics is SoftPlease consider Best Buy cuts outlook as results disappoint.

Dec. 14, 2010, 12:55 p.m. EST

The No. 1 U.S. electronics retailer’s profit fell as lower demand for televisions, notebook computers and videogames led to a sales shortfall in the U.S. While margin widened slightly, analysts said they were concerned that it came at the expense of sales.

Best Buy Co. shares tumbled more than 15% Tuesday, their biggest decline in more than eight years, after the retailer reported an unexpected decline in fiscal third-quarter profit and cut its outlook.

“There’s interest there from consumers on the latest and greatest, but really they are making trade-offs in their discretionary spending, not only across CE [consumer electronics], but within CE categories, where there are periods of time we may have historically seen them buy multiple large products in a year, they are being more choosey at this point in time,” said Muehlbauer [Best Buy's CFO] on a conference call with analysts.

Ample Warning

There was ample warning for that huge miss at Best Buy. On December 3, a report from SpendingPulse showed Retail Sales Led by Apparel, Consumer Electronics and Appliances Down.

Retail sales are way up year-over-year and apparel is leading the way. I have this email from SpendingPulse to share: ….

Year-over-year Total Apparel sales in November saw another sharp monthly increase. At 9.6% this was the largest year-over-year growth in 2010 for that sector following the previous record in October. Total apparel has enjoyed 8 out of 11 months of year-over-year gains so far in 2010. In November, all of the sub-sectors posted year-over-year growth.

For the second consecutive month, the Consumer Electronics and Appliances segment posted a year-over-year decline, although at -1.1%, it was not as severe as October’s decline. The Consumer Electronics sub-category was down by 1% while the Appliance sub-sector fell by 1.6% year-over-year.

Pent Up Demand For Clothes

The SpendingPulse report shows a pent-up demand, not for junk, electronics, or appliances, but for specifically clothes.

Repeating my ending comment from the above article: It’s nice to see shoppers focus on real needs instead of electronic garbage. However, pent-up demand for apparel cannot last forever, nor can apparel sales form the foundation for a lasting recovery.

Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com