The current economic mess is killing America. We, in my not humble opinion, are in for some really rough times. Rough times may not have filtered down to you the reader yet, but probably will soon. Examples are not hard to find. I have clients all over America, Literally. Here are some examples. In deep South Mississippi, a furniture dealer has virtually no business. No one has any money or good credit. A motorcycle dealer in California, says his business collapsed three months ago. All he is selling are a few little motor scooters which get good mileage, and which aren’t very profitable. In Tennessee, a man who sells and moves dirt, says his business is virtually non-existent. A developer has a developed piece of land, complete with water, sewer, paving, and sidewalks, and no one is buying a single lot. He is $1.6 million in debt, and doesn’t know what he is going to do.
A client called me yesterday, and said that he has a business credit card with a $7,000 balance on it. He has never missed a payment, and his credit rating is excellent. The bank who issues it, called him and offered to settle it for $1500. He didn’t believe it, and requested it to be in writing, which he promptly got. He paid off a $7,000 debt with $1500, because the bank ( a major one), is so desperate for cash, that they will do anything to get it. I have since heard of other credit card holders who have been offered a settlement for twenty cents on the dollar. If you have that situation, try it.
Car dealers are stuck with hundreds of thousands of un-sold cars, on which they are paying interest to the manufacturer until they are sold. Many car dealers have quit or are bankrupt. I have two friends who have used car lots, and nothing much is selling. When something does, it is the cheapest cars they have. We went to the theatre last night, and I know the manager well. I asked him how business was, and he said catastrophic, it was so bad. In the theatre there were 10 other people besides my wife and myself. A client who has an HVAC business in a hot area, this past summer saw his business drop off to virtually nothing. No new installations, and no maintenance. Calls only if the air conditioner quit completely. The Durango to Silverton (Colorado) train is down about 35%, and one train has been eliminated. Gasoline is in short supply in the South, and I suggest that everyone keep their tanks full and get some five gallon cans and fill them too. Go to “archives” at the top of the web site and see that there are 800 columns I have written. The very first one is titled, “Diary of a Depression,” and it fits today.
Hundreds of thousands are out of work, and it is a chain reaction which will not stop, I am afraid. Meantime of course, the boobs in D.C. claim $700 billion is needed, but they will probably spend at least $2 TRILLION, bailing out banks. Now, the auto makers are out to get $25 billion in loans to keep them afloat. There’s a bill for that already in the hopper. Who else will want a bailout? Home prices have not reached the bottom yet, and there are literally millions of foreclosures. Let’s bail out credit card holders, real estate salesman and developers. How about the tourist industry? Here’s a bad idea, but it may be a sort of solution. Let the people in the foreclosed homes stay there, and re-write the mortgage to the current home value, with the same payments. The banks would then have money coming in and no empty homes being vandalized. That would stop the foreclosures, no one would have to move, and those who loaned, would have to make do, or find themselves with millions of empty homes with no maintenance and vandalism. The banks and their cohorts created the mess.
As I write this, all the pols and media are screaming that unless the ’bailout’ is done, the economy will collapse. It virtually already has, and spending $2 trillion, or $700 billion more, will only create hyper-inflation, and make it even worse. There’ll be no limit on how much is “needed,” believe me. They’re all like a bunch of used car salesmen, hawking a worn out car that was only driven by a little old lady going to church on Sundays. My god people, stop this ’bailout,’ which is one of the all time great frauds in history!
This derivative disaster, which I predicted a couple of years ago, (see columns on them in archives), has come home to roost, and the tentacles of it will reach far and wide. Everyone will feel this, and not just a few. Get your dollars out of the banks, and get out of dollars. Get into gold or silver, and protect yourself. There are so many who want to do just this, that silver manufacturing capabilities are being strained to the limit, causing delays in delivery. Gold is not delayed. Colorado Gold and our supplier are honest, and you can trust us if you wish to lock in silver purchases at today’s prices. You will get your purchase. Fleeing to safety had to happen eventually, and it has only barely begun.