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Guest Post: Meet One Of The Victims Of The “Economic Recovery”

Submitted by Michael Snyder of The Economic Collapse blog,

Have you ever cried yourself to sleep because you had no idea how you were going to pay the bills even though you were working as hard as you possibly could? You are about to hear from a single mother that has been there. Her name is Yolanda Vestal and she is another victim of Obama's "economic recovery". Yes, things have never been better for the top 0.01 percent of ultra-wealthy Americans that have got millions of dollars invested in the stock market. But for most of the rest of the country, things are very hard right now.

At this point, more than 102 million working age Americans do not have a job, and 40 percent of those that are actually working earn less than $20,000 a year in wages. If we actually are experiencing an "economic recovery", then why is the federal government spending nearly a trillion dollars a year on welfare? And that does not even include entitlement programs such as Social Security and Medicare. We live in a nation where poverty is exploding and the middle class is shrinking with each passing day. But nothing is ever going to get fixed if we all stick our heads in the sand and pretend that everything is "just fine".

What you are about to read is an open letter to Barack Obama that has gone absolutely viral on the Internet in recent days. It is a letter that a single mother named Yolanda Vestal posted on her Facebook page, and it has really struck a nerve because countless other young parents can clearly identify with what she is going through. The following is the text of her letter…

Dear President Obama,

I wanted to take a moment to say thank you for all you have done and are doing. You see I am a single Mom located in the very small town of Palmer, Texas. I live in a small rental house with my two children. I drive an older car that I pray daily runs just a little longer. I work at a mediocre job bringing home a much lower paycheck than you or your wife could even imagine living on. I have a lot of concerns about the new “Obamacare” along with the taxes being forced on us Americans and debts you are adding to our country. I have a few questions for you Mr. President.

Have you ever struggled to pay your bills? I have.

Have you ever sat and watched your children eat and you eat what was left on their plates when they were done, because there wasn’t enough for you to eat to? I have.

Have you ever had to rob Peter to pay Paul, and it still not be enough? I have.

Have you ever been so sick that you needed to see a doctor and get medicine, but had no health insurance because it was too expensive? I have.

Have you ever had to tell your children no, when they asked for something they needed? I have.

Have you ever patched holes in pants, glued shoes, replaced zippers, because it was cheaper than buying new? I have.

Have you ever had to put an item or two back at the grocery store, because you didn’t have enough money? I have.

Have you ever cried yourself to sleep, because you had no clue how you were going to make ends meet? I have.

My questions could go on and on. I don’t believe you have a clue what Americans are actually going through and honestly, I don’t believe you care. Not everyone lives extravagantly. While your family takes expensive trips that cost more than most of us make in two-four years, there are so many of us that suffer. Yet, you are doing all you can to add to the suffering. I think you are a very selfish and cold hearted man, who does not care what is best for the people he was elected by (not by me) to represent, but more so out for the glory of your name attached to history. So thank you Mr. President, thank you for pushing those of us that are barely staying afloat completely under water and driving America into the ground. You have made your mark in history, as the absolute worst and most hated president of the United States. God have mercy on your soul!

Sincerely,

Yolanda Vestal

Average American

These are the kinds of emotions that millions of American parents are wrestling with on a daily basis. Many of them are working as hard as they possibly can and yet still find themselves unable to adequately provide for their families.

And now that food stamps are being cut back, more of them than ever are going to be forced to turn to food banks for help. The following is what the head of a large food bank in Casper, Wyoming told one local newspaper about the increase in demand that he is witnessing in his area…

Across the state, food banks and other related programs aiming to feed the needy are worried the supply to meet the uptick in need during the holiday season won’t meet the growing demand for food caused by the expiration of SNAP benefits.

“People are scared to death of the lack of food availability,” Martin said.

Martin called Joshua’s Storehouse a reliable barometer for measuring the rate of need in Casper. The number of people using the food bank skyrocketed before the reduction in SNAP, he said.

Fewer than 2,000 people used the food bank in October 2012. Last month 2,500 people went there for help.

And of course this is not just happening in rural areas either. Margarette Purvis, the head of the largest food bank organization in New York City, says that she is anticipating a huge surge in demand and that veterans are being hit particularly hard…

"On this Veterans Day, when we’re waving our flags — I need every New Yorker to know — 40 percent of New York City veterans are relying on soup kitchens and pantries."

Purvis says that there are 95,000 vets relying on food banks in New York City alone.

That is a lot of people.

And while Barack Obama may trot out a few vets on national holidays and promise that "we will never forget" them, the truth is that most of the time the federal government treats our military veterans like human garbage. If you doubt this, please see my previous article entitled "25 Signs That Military Veterans Are Being Treated Like Absolute Trash Under The Obama Administration".

Meanwhile, anger and frustration with the economy are starting to rise to very dangerous levels in this nation.

In a previous article, I noted that violent crime in America rose by 15 percent last year. One of the primary reasons for this is the economic despair that we see in our streets.

As the economy gets even worse, people will become even more desperate. We will start to see even more flash mob crimes like we saw in Chicago recently. Posted below is a video news report that shows footage of a flash mob in Chicago dragging entire racks of merchandise out of a Sports Authority store…

When you watch stuff like this, it helps to explain why demand for armored vehicles among the ultra-wealthy in America is skyrocketing.

Unfortunately, most Americans cannot afford armored vehicles and walled vacation homes in the middle of nowhere.

Most Americans are going to have to live right in the middle of all of this as it happens.

A volcano of anger, frustration and despair is simmering just below the surface in America.

When that volcano finally erupts, it is going to be a very frightening thing to behold.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/knVqVQ4yhPM/story01.htm Tyler Durden

America and Israel Created a Monster Computer Virus Which Now Threatens Nuclear Reactors Worldwide

In their obsession to stop Iran from developing nuclear weapons, the U.S. and Israel created a computer virus (called “Stuxnet”) to take out Iran’s nuclear reactors.

The virus appears to have spread to other countries.

One of the world’s top computer security experts – Eugene Kaspersky – said this week that the virus has attacked a Russian nuclear reactor. As The Register notes:

The infamous Stuxnet malware thought to have been developed by the US and Israel to disrupt Iran’s nuclear facilities, also managed to cause chaos at a Russian nuclear plant, according to Eugene Kaspersky.

The revelation came during a Q&A session after a speech at Australia’s National Press Club last week, in which he argued that those spooks responsible for “offensive technologies” don’t realise the unintended consequences of releasing malware into the wild.

“Everything you do is a boomerang,” he added. “It will get back to you.”

***

“Unfortunately, it’s very possible that other nations which are not in a conflict will be victims of cyber attacks on critical infrastructure,” said Kaspersky.

“It’s cyber space. [There are] no borders, [and many facilities share the] same systems.”

Not finished there, Kaspersky also claimed to have heard from “Russian space guys” in the know that even machines on the International Space Station had been infected “from time to time” after scientists arrived aboard with infected USBs.

Watch for yourself:

Other security experts agree.

As British security website V3 – in an article entitled “Stuxnet: UK and US nuclear plants at risk as malware spreads outside Russia” – reports:

Experts from FireEye [background] and F-Secure [background] told V3 the nature of Stuxnet means it is likely many power plants have fallen victim to the malware ….

F-Secure security analyst Sean Sullivan told V3 Stuxnet’s unpredictable nature means it has likely spread to other facilities outside of the plant mentioned by Kaspersky.

“It didn’t spread via the internet. It spread outside of its target due to a bug and so it started traveling via USB. Given the community targeted, I would not be surprised if other countries had nuclear plants with infected PCs,” he said.

Director of security strategy at FireEye, Jason Steer, mirrored Sullivan’s sentiment, adding the insecure nature of most critical infrastructure systems would make them an ideal breeding ground for Stuxnet.

***

Steer added the atypical way Stuxnet spreads and behaves, means traditional defences are ill equipped to stop, or even accurately track the malware’s movements.

“It’s highly likely that other plants globally are infected and will continue to be infected as it’s in the wild and we will see on a weekly basis businesses trying to figure out how to secure the risk of infected USB flash drives,” he said.

***

The use of XP in power plants is set to become even more dangerous as Microsoft has confirmed it will officially cut support for the 12-year-old OS in less than a year. The lack of support means XP systems will no longer receive critical security updates from Microsoft.

That’s almost as brilliant is waging a global war on terror in such an idiotic way that it is increasing terrorism …

Bonus:

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/xi2WZbLOTeU/story01.htm George Washington

Quote Of The Day: Is Larry Fink Confused?

This morning has seen a plague of talking-head-based soundbites propagated through the mainstream media as ‘fact’ and actionable. One that caught our eye, from none other than “largest asset manager in the world” Larry Fink of Blackrock, simply beggared belief:

*FINK SAYS JAPANESE INVESTORS QUESTIONING INVESTING IN U.S. DEBT

As we recently noted, the Japanese bond market is now dead (for all intent and purpose) but a glance at the following chart of credit reality suggests those Japanese investors might stop to reflect a little on their own reality…

As Hayman’s Kyle Bass previously noted,

how many have seen this chart showing global sovereign debt as a percentage of total government revenues?

Is there now any doubt after seeing this why the proverbial four
horseman are really just one giant black swan, only not one of failed
bond auctions or something quite as dramatic, but something as simple
and mundane as the smallest uptick higher in rates which would blow up
the entire global financial farce, starting with the most imbalanced
domino of all – the land of the rising sun?… And that at least Greece is not Japan?

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/HHSKhuMN8cM/story01.htm Tyler Durden

The Biggest Threat To Minimum Wage Restaurant Workers Everywhere?

Over the past year, unionized restaurant workers across numerous fast-food chains but mostly at McDonalds, expressed their dissatisfaction with compensation levels by striking at increasingly more frequent intervals – a sentiment that has been facilitated by the president himself and his ever more frequent appeals for a raise in the minimum wage. Unfortunately, as we have pointed out previously, in the context of corporations that have given up on growing the top line (as virtually all free cash goes into stock buybacks and dividends and none into growth capex), and in pursuit of a rising bottom line, employee wages are the one variable cost that corporations will touch last of all. But what’s worse, these same unionized employees have zero negotiating leverage.

Perhaps nowhere is this more visible than in the recent strategy of smoothie retailer Jamba Juice, which in order to battle a 4% drop in Q3 same store sales has decided to radically transform its entire retailing strategy by getting rid of labor, cheap, part-time or otherwise, altogether. Presenting the biggest threat to minimum-wage restaurant workers everywhere: the JambaGo self-serve machine that just made the vast majority of Jamba’s employees obsolete. Coming soon to a fast-food retailer near you.

Why did Jamba just make its retail sales force obsolete? Part of the problem is heightened competition: McDonald’s has entered the smoothie market, and others like Dairy Queen and Panera spent the summer promoting their rival drinks. Which means even less top-line growth potential. It also means that in order to push more of the top line straight to earnings, and bypass variable costs, a problem that will be faced by increasingly more corporations, Jamba’s corner office had no choice but to unleash JambaGo.

Bloomberg reports:

The smoothie chain is hoping to see improvement from something it calls “JambaGo,” a self-serve machine that can be installed in cafeterias, schools, and convenience stores. Jamba Juice makes money by selling the prepackaged, pre-blended smoothie ingredients to JambaGo vendors, like a soda maker selling syrup to the owner of a soda fountain. The advantages: Jamba doesn’t need to build a store and the labor costs are much lower compared with hiring staff to concoct made-to-order drinks.

The company expects this model to help expand its brand more quickly and cheaply. Last quarter, however, revenue from the JambaGo program amounted to just about $400,000. But having recently landed a deal with Target (TGT) to put JambaGo machines in 1,000 Target Cafés, the company will soon have installed more than 1,800 machines (up from only 404 at the start of 2013). By contrast, there are currently about 850 Jamba Juice stores.

Based on a goal of $2,000 in annual revenue per JambaGo, the rough math for 1,800 machines is $3.6 million—a decent boost for a company that took in $228.8 million in revenue last year. Another 1,000 are planned for 2014, which would bring in another $2 million in annual revenue.

Here’s what happens next: Jamba will do what every other company does to demonstrate that its radical strategy is successful – fudge the numbers and beat EPS for several quarters. This will happen even if JambaGo is ultimately yet another loss leader. However, its peers will watch closely and soon decide to roll out their own version of just this: a self-contained dispenser of a la carte prepared fast-food food, either liquid or solid, and in the process let go tens of thousands of their own minimum-wage employees, also known to shareholders as “costs.”

What happens after that should be clear to everyone: more unemployment, lower wages for the remaining employees, worse worker morale, but even higher profits to holders of capital. And so on. Because in a world in which technology makes the unqualified worker utterely irrelevant, this is what is known as “progress.”

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/Ruo_KGnbgwc/story01.htm Tyler Durden

Commodities Clubbed, Stocks Mixed On “Good-Cop-Bad-Cop” Fed Speak

The Nasdaq and Trannies closed green, Dow and S&P red (the latter pinned to VWAP thanks to some late-day JPY ignition dragging it off the lows). Volume was 'average and into the close VIX was bid as stocks clung to VWAP. Treasury yields limped higher from yesterday's small rise (30Y +1bps on the week, 5Y +4bps). The USD index would suggest a quiet day (practically unch of the week) but dispersion with EUR strength and AUD and JPY weakness was notable. Credit markets continued to slide notably. The biggest moves of the day were in commodity land with silver -3.5% on the week and gold and oil pinned to each other (petrogold?) -1.5% on the week, and copper -1% on the week. Today was all about POMO (as usual) and dueling Fed speak (Lockhart talked us down and Kocherlakota saved the day).

The day in stocks…

quite dispersed across the indices with the DoJ airline deal topping the Trannies…

Credit ain't buying it…

and Commodities were sold…as POMO ended and Europe closed…

While the USD ends unch, there is clearly a lot of dispersion in FX markets…

Shorts "won" today – as yesterday's squeeze was collapsed back lower…

Charts: Bloomberg

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/Km5ScB0lCo8/story01.htm Tyler Durden

Commodities Clubbed, Stocks Mixed On "Good-Cop-Bad-Cop" Fed Speak

The day in stocks…

quite dispersed across the indices with the DoJ airline deal topping the Trannies…

Credit ain't buying it…

and Commodities were sold…as POMO ended and Europe closed…

While the USD ends unch, there is clearly a lot of dispersion in FX markets…

Shorts "won" today – as yesterday's squeeze was collapsed back lower…

Charts: Bloomberg

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/Km5ScB0lCo8/story01.htm Tyler Durden

Life Through the Lens of a Central Banker

By: Chris Tell at capitalistexploits.at

I am a central banker. Let me tell you my story. I look presentable, nice suits, am well spoken, I have impeccable credentials. I wear a vacuous stare, though I like to think of it as a stern expression. My most honest feature, other than low wattage IQ, is that I am a complete a-hole. Imagine Tucker Max meets Paul Krugman, a cocktail if ever there was one.

I am, unsurprisingly a self-serving, arrogant pr!#k. I am unencumbered by a working knowledge of arithmetic, all of which are prerequisites for the job I hold.

Work, if you could call my disguised witchcraft that, is ridiculously easy. It involves the creation of trillions of digital blips, humorously referred to as “money”. I do this with vigour and sometimes, especially after a stiff scotch, with wild abandon, whoopee!

Just because I don’t need to work, that doesn’t mean that everyone else enjoys such a reprieve, in fact my activities actively ensure that all those around me have to work twice as hard. I told you I was an a-hole.

The process of my creating “money” out of thin air is a little complicated…to fool the hoi polloi of course. The process involves issuing debt and then buying it myself. Nifty little trick really, quite genius stuff and the vast majority of the populace don’t seem to mind it one bit. In fact, the financial markets want more of it. Wonderful stuff!

In order to pull it off I enlist economists whom I ensure my mates at the Nobel committee award prizes to. These charlatans are trolled out to sing the praises of me and my fellow colleagues “work”, and together with the Lame Street media they peddle the required message like a well-dressed crack dealer peddling his latest laboratory concocted death vice to impressionable school kids.

This is not enough…oh not nearly enough. My buddies, whom I’ll likely join when I “retire” from my current position all work at a wonderful place called Goldman Sachs. This is where I will go on to do “God’s work”.

I realise that to complete the process of paying myself and my buddies on Wall Street with the proceeds of citizens hard work, I need more than simply smoke screens, academic “thought leaders”, Lame Street media and congressional parasites, I need enforcement. This is just in case any of the plebes decide they’ve gotten wise to my gig.

This of course is where legislature comes in. In order to “enforce” one needs some jack-booted thugs. These are easily recruited from the sub-educated classes who rally to the cry, “I’m a patriot”. Military minds, easily counted on. Getting them to do the dirty work is cheap and surprisingly easy.

The hoi polloi, for reasons that I cannot fathom, love to look toward a leader. Being the complete prat that I am, I together with my banker buddies have concocted something called democracy. On the outside it’s designed to look like “the people” are choosing their favourite leader. It’s an elegant solution and keeps me in full control at all times. I trot out a few podium doughnuts to appease the masses and voilà, they follow like rats to a flute.

The fact that I, and my buddies are actively turning what was the world’s most favoured, and prosperous nation into a giant leper colony doesn’t matter to me. Few see it, and those that do have likely already left for greener pastures.

Those who don’t know what they’re talking about rail against my work, calling it some “crazy experiment” which they profess would have ended long ago if it weren’t for a strange anomaly. Every other developed nation on this planet is doing exactly the same thing as I am, causing a gigantic, artificial sea of liquidity.

These ignorant fools suggest that like all things artificial, someday our tinkering will backfire. What they fail to see is that we’ve created a cohesive solution to not only our problems, but those of all indebted western economies.

I can get away with this since my competition, namely the developed worlds other central bankers, are all doing the same thing.

Not all is well though. Apparently their exists growing discontent, mass unemployment, social exclusion, rising ethnic tensions due to inequality, deepening poverty and rising despair. I look around at my friends while sipping a ridiculously expensive whiskey and have to disagree. The stock market is up, the dollar is strong(ish), government issued bonds are the strongest they’ve ever been…things are just dandy.

If this world seems surreal it shouldn’t. You have yourself a front row seat…we all do.

– Chris

“No man’s life, liberty, or property are safe while the legislature is in session.” – Mark Twain

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/6tgSAyfnOlE/story01.htm Capitalist Exploits

Ranking Bernanke

Submitted by Chris Turner via dshort.com Advisor Perspectives,

With Ben Bernanke's tenure closing, many financial TV pundits delight in touting the stellar performance of Ben Bernanke as Federal Reserve Chairman with just a couple months left in his term. Before the re-writers of history begin spinning performance, I thought why not compare Mr. Bernanke against all the other Federal Reserve Chairman to determine which Chairman deserves recognition. Picking the first two categories seemed easy enough, the "mandates" of the FED.

"The Board of Governors of the Federal Reserve System and the Federal Open Market Committee shall maintain long run growth of the monetary and credit aggregates commensurate with the economy's long run potential to increase production, so as to promote effectively the goals of maximum employment, stable prices and moderate long-term interest rates."

Stable Prices as measured through the Consumer Price Index

Employment (though this wasn't a fed mandate until late 1970's) as measured by:

Total Employment

Employment Population Ratio

Unemployment rate

After comparing the Fed's mandate, I looked at categories that the Fed impacts via policy decisions;

Total Credit

Fed Credit Outstanding

Monetary Base

Real Income Growth

Other categories seemed plausible as Federal Reserve policies may stimulate growth in the private sector via policy decisions which show in the components of GDP;

Net exports

Personal consumption expenditures

Domestic investment

Although Government Spending is part of GDP, I removed this because I measured many parts of Government spending to include deficits, total budget growth, Gross federal debt, tax receipts & many more. Most of these categories would be better suited to a presidential or congressional measurement rather than a Federal Reserve Chairman (but I have all the data for those that may be interested).

Let's get to know the 14 Chairman and method of measurements. Here is a snapshot of the previous Chairmen, when they started and finished, which presidents were in office, and their total tenure.

Since not all data measured was available back to 1913, I compared the Chairmen since 1948 (when most data began to coincide). Most people understand Basketball scores and not Golf, so I rank ordered the Chairmen in a high to low with 7 points possible as the best in a category and 1 being the worst (representing the 7 chairman). The high score of all categories, wins. In most, I measured the growth (or decline) as a compounded annual growth rate to account for total years of tenure, then sorted the rankings appropriately. Once the categories were ranked, I tallied the score as shown below.

The yellow highlight shows the total of all nine categories. Martin's tenure of 18.85 years produced the best combination of the nine categories and the overall best in the Fed mandates. Although Bernanke scored higher than 2 others in the mandates, his overall score was the lowest (let the spin begin counterfactualists).

#############################################

What is a post at Doug's Advisor Perspectives site without charts – so let's start with the best of the mandates for Bernanke; CPI. The chart below shows the Consumer Price Index, All Urban with 1982 set to 100 (data available from St. Louis Federal Research – FRED). The alternating grey and white bars show the terms for the respective Chairman.