Monday, February 06, 2023

Thoughts and perspectives

| June 18, 2010 9:00 PM

This will be my last article in this series. I expect to renew my thoughts and perspectives in late August.

Several headlines in the Wall Street Journal this past week caught my attention The first one, "CONSUMERS TIGHTEN BELTS" ...'Surprise drop in spending adds to doubts about the recovery's strength'. Why is this a surprise? Apparently there is a tremendous amount of denial about the status of the economy. I have been writing about this event for over a year, so why the surprise now? Second headline read "Economists expect slow U.S. growth." Survey suggests recovery will be slow but steady etc ... I say very slow and bumpy. We have been duped by Washington and the media in thinking that the recovery is just around the corner. Not this time; not by a long shot.

If you take the blinders off for a minute and view the cycle that we are in, you will note 1) The government helped create the problem so it could insure you felt really bad about things and it could solve it for you. 2) The bubbles will continue to burst all year long. Specifically they will be the 'cap and trade' legislation which will raise our monthly electric bill substantially. The amnesty bubble will be set in motion with language included which will make us feel really bad about the 12 million people in this country illegally. That will further depress our labor force and lower wages in the process. The housing bubble will continue because money from the now federally controlled banks will be lent scarcely. Folks are scared to even invest in housing because they are afraid of their jobs, new taxes that will be in place by the end of the year, property taxes that continue to be exploding and loss of their purchasing power because the dollar is losing value leading them to be extra conservative in this area. Coupled with the world wide explosion and implosion of debt, what will be the outcome?

So what happens now? Will our government stop printing money? Will defaults around the globe lead to destruction of our money, banking and credit systems? Will we go under? Fact ... Greece is slashing 30 billion euros from its budget. Spain 15 billion euros plus a 5 percent reduction in state wages. Italy slashing 25 billion euros over the next 2 years, Portugal cutting 2 billion euros from its budget, Germany, thought to be the more stable of the European countries a whopping 85 billion euros by 2014. The wake up call has been heard in Europe and we even are starting to hear about it in this country. As I suggest, the economic recovery will be prolonged by high unemployment and slow growth, and the government is now realizing that the gigantic stimulus package, printing money and poor long term policies by the Fed are untenable. The last 16 months of government intervention ... did not work. I implore a radical change in direction. Slash taxes now, end the runaway spending, take the medicine at once and tell us the truth.

I urge you, as individuals and families, to protect your assets as much as you can. In my opinion, the DOW will lose about 12 percent and the housing market another 4 percent by the end of the summer while the dollar continues to drop in value. We are all going to have to participate in the downturn and the awful pain of recovery that is before us.

I have one seminar to deliver, next Wednesday, June 25 with a few spaces left. Call the toll free number and register. Learn how to protect what you have worked hard to achieve. Don't depend on Washington. Do not wait for the Biggest Shock of all. Create your own bailout. Let's go to DEFCON 3.

Jack Schroeder is a licensed insurance agent in Idaho and Washington. He can be reached at (208) 773-2507.

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