If you look to the mainstream media, the current administration or even executives from large U.S. corporations for a status update on our economy, you can expect the vast majority of responses to fall in line with the following quotes (WARNING: ingesting liquids while reading these quotes could result in a wet computer screen):
“It is unquestionable that President Obama’s economic policies have been instrumental in ending the worst downturn since the Great Depression.” – Andrew Fieldhouse, Federal Budget Policy Analyst at the Economic Policy Institute
“The U.S. economy is getting a little better each day…the daily crises have been eliminated.” – General Electric CEO Jeff Immelt
“Recent Labor Department data is consistent with the expectation of continued recovery in the economy.” – Former Federal Reserve Chair Ben Bernanke
“Substantial progress has been made in restoring the economy to health.” – Current Federal Reserve Chair Janet Yellen
“By all measures, President Obama has outperformed every modern president [economically].” – Bob Deitrick, co-Author of Bulls, Bears and the Ballot Box
“The U.S. economy is definitely improving.” – Honeywell CEO David Cote
“The U.S. economy is definitely better off under Obama.” – Robert Schlesinger, Managing Editor at U.S. News & World Report
Obama apologists want us to believe that everything is rosy. They want us to stop saving and start spending. Those of us who were active savers prior to the Great Recession can see clearly that trouble is brewing, and that the crash in 2008 was just the tip of the iceberg. However, many Americans have been programmed to swallow without hesitation the garbage that “news” outlets like MSNBC produce. The late comedian Bill Hicks said it best: “Go back to bed, America.” The money that those Americans were too scared to spend during the recession is burning a hole in their pockets now that things seem to have settled down. The talking heads say it’s time to spend, so spend they shall.
What’s the real state of our economy? Certified Gold Exchange analysts have compiled a bevy of non-partisan data and cold, hard facts that paint a clear picture of the U.S. economy, job market and inflation. This information is not for the squeamish or faint-of-heart, as it depicts a nation drowning in debt, choking on its own stimulus programs and shooting itself in the foot via antiquated monetary policies. It’s quite ugly, to be blunt.
Nevertheless, most of us are mature enough to prefer a painful truth over a fantastic fallacy, and these numbers don’t lie. While the U.S. economy is imploding, the rest of the world is overtaking us in a variety of ways. We’ve fallen from the #1 GDP per capita nation to #14 in just a few years. The United States is bleeding manufacturing jobs like there’s no tomorrow, and there may not be.
China, along with India and parts of South America, is emerging as a dominant world power in manufacturing and natural resource production. Even GM CEO Jeff Immelt, quoted above, admitted, “China has massive financial strength.” The United States, meanwhile, is emerging as the dominant world power in drug use, obesity, per capita debt and industrial outsourcing.
None of these facts have stopped the current administration from its policy of shameless self-promotion. At a recent White House dinner to which a group of unemployed Americans were invited, President Obama touted the fact that, “our businesses have created more than 8 million jobs since we hit bottom…America’s getting stronger and we’ve made progress.” The unemployed dinner guests’ faces reflected their skepticism – or maybe they just weren’t fans of the First Lady’s uber-healthy hors d’oeuvres.
JOBS & PAY INCREASES – OR A LACK THEREOF
In 2009 there were 92 million Americans who were either officially unemployed or not in the labor force. That number stands at 108 million today. To put it another way, 45.5% of able-bodied, working-age Americans do not have a job. During the recent recession over 220,000 small businesses closed shop, putting countless Americans out of work. Food stamp program participation has skyrocketed as a result. In just the last 14 years the number of Americans on food stamps has almost tripled, going from 17 million in the year 2000 to more than 47 million today.
Even people who were able to retain jobs have suffered. How so? Well, the government says inflation is currently occurring at a rate of just 2%, but that figure does not take food or fuel costs into account. Since 2008 the average price for one gallon of gas has almost doubled, going from $1.85 in 2008 to $3.64 today. Ground beef prices have increased more than 61% in the last 10 years. Those who do their own grocery shopping have probably noticed that while the price of many products appears to remain the same the size of the product itself keeps shrinking. Your carton of Tropicana orange juice is 12% smaller today than it was in 2008. Pepperidge Farms is putting 10% less sausage in their packages today than they were before Obama was elected. The days of product labels boasting “25% more FREE” are over, and then some.
Additionally, wages are flat from coast to coast, even down in some parts of the country. In 2007 the average household income adjusted for inflation was $55,627. By 2012, the most recent year for which there is data, inflation-adjusted income fell to $51,017. That’s a $4,510 decline in earnings despite the fact that excessive currency printing and outsourced manufacturing have made things we buy more expensive.
A $17 TRILLION NATIONAL DEBT? YOU WISH.
And then, of course, there is our national debt. According to USdebtclock.org each American family owns (and owes) a $700,000 share of the super-sized national debt. If you eliminate from the equation the families that are unable to pay their share that figure jumps to over $2 million per able family. That $63 million figure is more than 50 times the average American’s income. By the way, that’s just each family’s share of the total federal debt. If you throw in unfunded pensions and other debt at the state and municipal levels each able-bodied family owns a $4 million share of U.S. debt.
The U.S. national debt has increased by an average of $4 billion per day since President Obama took office. The federal government has accumulated more debt under Obama’s watch than it did during the terms of the first 42 presidents combined. In just the first two years of his presidency Obama added more to the U.S. national debt than did the first 100 Congresses combined. The United States of America is supposed to be the land of the free, Mr. President, not the land of the free lunches and free money.
NATIONAL RECOVERY & PERSONAL SUCCESS ARE INDEPENDENT OF ONE ANOTHER
So, do you feel that we are experiencing an economic recovery? Are you comfortable saying that our nation is on firm financial ground? As John Wayne’s character in Big Jake famously said, “Not hardly.” Jim O’Sullivan, chief economist for High Frequency Economics, said it best. “We’re four and a half years into the ‘recovery’, and if we haven’t got a V-shape recovery [by] now, we’re certainly not going to get one.”
Where does that leave those of us who have something to lose? Where can we safely store our wealth in a manner that it could increase with our nation’s problems? Stock indices have been on the rise lately, but once interest rates start to rise stocks will likely fall back. During the 1970s and 80s there were over 100 interest rate hikes and each time rates rose stocks fell back. The Dow, the Nasdaq and the S&P 500 all fell back an average of 3% each time interest rates rose by 1%, and analysts believe a very similar trend could develop in this cycle.
Most cash accounts including bonds, CDs and savings accounts are paying far below the rate of inflation. If you have $100,000 in cash earning a generous 1% you’re losing money once inflation is taken into account. Investing in real estate is no longer the guaranteed home run it once was thanks to ARMs, high foreclosure rates and many Americans’ lack of income. That leaves us with precious metals.
Sure, one could invest in diamonds, oil or commodity stocks, but none of those investments have a 5,000 year history of being used as currency. Gold and silver are tangible, measurable assets that move opposite a falling dollar and historically rise with interest rates. Gold and silver are stores of wealth, completely private and instantly liquid. Gold and silver do not pay dividends, and they do not earn interest. There are no profits, losses or taxes until the metals are sold. Gold rose by more than 1000% in the last high inflation cycle of the 1970s, but is a quick profit really your primary objective? If you are like most gold-buying Americans, probably not.
Profits are nice, but safety is imperative. A safe or bank deposit box full of gold and silver coins and bars means you can sleep better at night because you have an insurance plan to protect you from the unknown. Gold is the bullet-proof vest protecting your portfolio. Gold is your sword to slay inflation.
The Certified Gold Exchange wants to help you set up a hedge that will safeguard your hard-earned wealth no matter what happens in the economy. That’s why all of our friendly advisers are non-commissioned experts. For over 20 years we have helped countless individuals and institutions diversify their portfolios with physically held gold and silver, and we can help you, too. Call the Certified Gold Exchange today at 1-800-300-0715 for an obligation-free portfolio evaluation as well as discounted pricing on all widely-traded investment-grade precious metals products and you will understand why Certified Gold Exchange is known as “America’s Trusted Source for Gold”.