SUNSHINE AND LOLLIPOPS IN THE LAND OF OZ

I know, it feels like we have been in the economic tank forever. And on the evening news and MSNBC it is all happiness and green shoots sprouting in every parking lot.

But if you think back, Europe started going down long before our system started to sink. It started when Bear Sterns went under. That took some major German banks down, and then across Europe it was the domino effect. It was several months before it came back to us, and our banks started to crash, in a big way.

Yes, sunshine and lollipops everywhere. So what is happening in Europe right now? If we have all these green shoots, they must be doing pretty good too, wouldn't you think? Well, I am glad you asked.

Eurozone banks face additional losses of more than $283bn this year and next as continental Europe’s severe recession intensifies strains on its financial sector.

While attention had so far focused on write-downs related to asset-backed securities and derivatives, the report said that “increasingly … attention is focusing on corporate debt and the likely loan losses that may materialise as the turmoil continues and the real economy endures a significant slowdown.” The ECB does not expect the eurozone to return to positive quarterly growth until the middle of 2010.

http://www.ft.com/cms/s/0/34f0b6c0-59c5-11de-b687-00144feabdc0.html

Well, that doesn't sound like they are seeing any green shoots.

Greece, has a lot of troubles, but their banks were OK, but now:

However, the situation may be about to worsen with analysts forecasting bad loans will rise this year from 3.8 per cent to about 6 per cent before peaking in the first half of 2010. Meanwhile, Fitch, the ratings agency, last week warned the banks’ performance for the rest of the year would likely be hit by higher loan impairment charges.

http://www.ft.com/cms/s/0/db00e69a-59c8-11de-b687-00144feabdc0.html

How about Spain? That is what Our Dear Leader points to as a model of Green Industry Growth, that we should follow:

Until this month’s European elections, Spain’s Socialist government ministers were determined to stay cheerful in public and talk of “green shoots” when referring to the country’s deep recession and its 4m unemployed.

The government also admitted for the first time that the economy would shrink next year as well as this. It announced sharp cuts in government spending to curb the 2010 budget deficit, which economists had predicted could reach 10 per cent of GDP. Ms Salgado has promised to reduce the deficit, starting next year, to the now widely ignored European Union limit of 3 per cent of GDP by 2012.

For every Green job created in Spain, they lose two jobs.

http://www.ft.com/cms/s/0/c04306f2-59c9-11de-b687-00144feabdc0.html

And in Europe in general:

Unemployment in the 16-country eurozone has risen steeply in recent months, reaching a 10-year high of 9.2 per cent in April. The ECB expects unemployment to continue to rise this year and next. But recent increases have been less severe in France and even less so in Germany.

Notice how the Europeans various deficits, are just 2 or 3% of their GDP.

Ours is greater than our GDP. And we are still spending like drunk sailors in the red light district or Paris.

China is buying IMF bonds, gold, gold mines and copper mines in Africa, using our debt to leverage things.

Russia is buying gold.

We are not sure if we even have any gold reserves anymore. The FED controls them, and they won't open the books. But I have read in numerous places the numbers do not add up. Most people think the FED has sold if not all, at least most of the US gold reserves.

What does all this mean? It means Europe is hunkering in for another crash, which means we should be as well. Instead of spending Trillions more.

We need to sell 150 Billion in T Bonds right now every month, just to cover the interest on the deficit we already have incurred. The countries that normally buy these, have already put limits on how much they will buy going into next year. And they will not buy enough to cover our current interest payments. Let alone new spending.

The price of Gold and Oil are things to watch. as their value goes up, our dollar goes down. That is the general rule. Might explain the jump in gas prices. Gold has been doing some strange things, and a lot of folks think the price is artificially being held down.

Which means the FED will be putting the printers into overdrive. Cranking out Billions in new dollars. That in turn will devalue the dollars we have even more. That will lead to inflation of the likes we have never seen. A $20 loaf of bread will not be out of the question.

Unemployment has already surpassed what the “experts” said it would be had we not had the Stimulus package. These are the same “experts” that are talking about the green shoots, and things are turning around.

Most independent stock market people, will tell you the FED and the Treasury are manipulating the markets to make it “Look” like we are in recovery.

The government does now at least acknowledge that unemployment is going to go higher. People are losing their houses in greater numbers, but they are hiding them on the books. They want to paint a smiley face on things.

As unemployment goes higher, state and federal tax revenues decrease. Yet they are spending more, knowing that there will be less revenues in the future. Does that make sense to anyone?

If you read through some of my other posts, you'll get the feeling this was all done on purpose to archive an end I'm not on the evil globalist conspiracy, but I do think one has been going on.

And it is the Progressives. They are in both parties, all western countries. And what we are experiencing now, is what they have been talking about achieving for over the last 100 years, at least in the United States.

It's a hybrid of Socialism, Communism, and Fascism.. Just look them up.