Never have there been more Americans purchasing preparedness supplies than today.

“I was never a ‘prepper’ through any of the past challenges but I sure as heck am preparing today,” said JD Rucker, CEO of Prepper All-Naturals. “I didn’t flinch through Y2K. I didn’t panic during the economic downturn of 2009. I didn’t pull out all my cash after Obamacare passed. I certainly didn’t stock up on toilet paper during the early days of Covid. But today, the threats finally seem real.”

Rucker’s company specializes in long-term storage beef… steak to be specific. Prepper All-Naturals offers sous vide, freeze-dried Ribeye, NY Strip, Tenderloin, and Sirloin with a 25-year shelf life. It is All-American beef. In fact, their cattle are born, raised, slaughtered, and packaged in Texas.

“None of our beef leaves the state until it’s in a bag being shipped to our customers,” Rucker said.

The fearmongering that we’ve been witnessing for decades has made many people like Rucker skeptical of all of the doomsayers. But as many Americans are realizing now, some of the “conspiracy theorists” were accurate with their warnings about the “UniParty Swamp” and the “Globalist Elite Cabal.”

Today, those conspiracy theorists seem prescient. Americans are rightly scrambling to protect themselves and their families.

“It’s more than just food that people need,” Rucker said. “I tell people constantly to make sure they have water, ammunition, meds, energy sources, appropriate clothing, comms, and their Bibles ready to go.”

Arguably the most important consideration is circumstantial. Americans with the resources and opportunity to do so are leaving cities, moving to suburbs or rural areas in anticipation of turmoil hitting metro areas first. Homesteading is becoming popular but not everyone can go that far in their preparedness, so they’re doing everything they can with the circumstances they’re in.

But there’s one thing that Rucker says is the most important for preparedness.

“Have a plan, share the plan, practice the plan,” Rucker said. “Having a bunch of resources is important but what happens when the proverbial crap hits the fan? Having something and knowing what to do with it are two different things.”

Rucker is currently working on an E-Book for “Late Preppers,” as he calls them. Anyone who purchases at Prepper All-Naturals and uses promo code “plan25” will receive 25% off their order and will be first to receive the E-Book when it’s completed.

“The best part about preparedness when done right is that it’s never a waste,” Rucker said. “If we’re forced to use our supplies because of emergencies, then praise God that we had them! If we’re never forced to use the supplies, then praise God we were spared and we have until 2049 to eat premium beef from Prepper All-Naturals! Either way, it’s better to be prepared and not need it than to not be prepared when disaster strikes.”

“Stop & Shop will make some difficult decisions to close select underperforming store locations to help ensure the long-term health and future growth for our business,” a spokesperson for the supermarket chain said in a statement.

According to NY Post:

The Massachusetts-based company currently operates nearly 400 stores in five states — the Bay State along with New York, New Jersey, Connecticut and Rhode Island. It has “remodeled” and made improvements to nearly half its stores.

It’s not a big deal, right? Actually, there is more than nuance that should be understood about this news. Here are the key takeaways:

Being Aloof Ahead of the Election

Despite breaking the news at an investor meeting and communicating the scope of their plans to their biggest benefactors, the chain has not released any information to the public. This is conspicuous because there is no viable reason to remain aloof at this stage unless their plans are to hold the information until a more opportune moment.

Considering there won’t be a better time for the sake of the company or investors to go into details about their plans now, it’s safe to attribute their secrecy to the current election cycle. Instead of just being another example of how poorly the economy is performing, they’re doing the minimum required disclosure to the pubic and quiet disclosure to major investors. They will hold details until after the election.

This Is Driven by Democrat Policy, Not Bidenomics

It’s easy to take every foul turn in the economy and blame it fully on the Biden-Harris regime, but this isn’t one of those. Consumers and producers are feeling the negative effects of Bidenomics, but grocery stores aren’t nearly as affected. Instead, this particular series of closures can be attributed to Democrat policies which have reigned in the Northeast for decades.

That’s not to say that Bidenomics didn’t contribute to the challenges. People with less money relative to price hikes are obviously buying less. But food is a necessity which is why inflation doesn’t necessarily harm a grocer’s bottom line as much as the consumers and the producers.

Food regulations, taxes, and mismanagement of infrastructure have more direct impacts on the profitability of a grocery store than inflation or other elements of Bidenomics. This falls more on local Democrats than the White House.

War on Food

It isn’t just leftist political maneuvers that harm grocers. Food in general is under attack on multiple fronts in the United States which is why inflation has hit sustenance costs harder than other areas.

This is not a glitch. Grocery stores shutting down in 2024 are part of the plan to bring food insecurity to Main Street America. Costs are not going to go down and any increases in income will be more than offset by rising inflation. It behooves Americans to take control of their food sourcing any way they can.

For some, this comes down to simply building relationships with local farmers and ranchers. Starting or enhancing a garden or even a homestead is a best practice.

Others, particularly those in cities, may not have easy access to farmers and they may not have the room for a garden. The best advice is to leave the cities, but that’s not practical or even possible for many. The best option in such a situation is to stock up on as much shelf-stable food as possible. Even a surplus of inexpensive (for now) canned foods is better than having to rely on government if the food supply chain breaks down.

Some would say that just because a grocery store chain started chopping stores that we shouldn’t panic. In reality, this is just one in a long line of events that point to the notion that taking control of our personal food supply is a best practice whether disaster strikes or not.

Sound off about this article on the Late Prepper Substack.

Weaker-than-expected harvest seasons and other manufacturing challenges have hit the biggest food companies in the country really hard throughout the year. And now, many retailers are already reporting inventory holes at a time when they should be receiving more supplies to prepare for the all-important holiday season.

For example, Americans might have to go out of their way to find asparagus for their holiday recipes next month. Michigan, California, and New Jersey reported an 11% reduction in the number of asparagus crops planted this year, and farmers also cited losses caused by fungus and beetles during the harvest season.

While more people will be looking for the veggie at big-box stores in the weeks ahead, retailers won’t likely be able to fulfill the entire demand. At local farmers’ markets, prices can be higher this season, but you’ll have greater chances of getting what you need for the perfect holiday dinner.

Similarly, flour, butter, shortenings, and oils are not only costing more but also becoming more scarce at grocery stores in 2023. The worldwide shortage of grains has been pushing the production of flour and vegetable oils down since 2022. Meanwhile, dairy products are being impacted by higher cow slaughter this year. And now that seasonal demand for baking supplies is about to grow home and professional bakers might have to fight for the available supply, according to Bloomberg. With holiday celebrations about a month away, many bakers have already started stocking up on the ingredients they’ll need. Those who haven’t yet should start making preparations now because many products may be sold out over the next couple of weeks.

You also might have heard about the massive decline in U.S. cattle production this year. A historic drought, rising fuel, and feed costs, as well as labor shortages, have all combined to create a perfect storm for the nation’s ranchers. Prices are expected to soar, too. According to the USDA, they are likely to double from a year ago levels.

The best cuts, including filet mignon and ribeye, will not only face even bigger price increases but also become harder to find, given that this year’s beef cows were much smaller than usual, and produced less meat. If you haven’t purchased steak for your holiday celebrations yet, don’t wait too long because you may struggle to get what you want.

Weather emergencies, supply chain disruptions, and an ongoing freight market crisis will exacerbate shortages and prevent retailers from restocking their shelves over the next weeks and months. Don’t wait until the last minute to search for the products you will need because you might end up paying a lot more than you would if you had prepared sooner. The holiday shopping frenzy has only just begun, and we should brace for a whole lot of chaos at U.S. stores next month.

In this video, we tracked the new product shortages that are about to hit the U.S. market in December and beyond so you can stay ahead of the shortages and get ready for the dark winter that is ahead of us.

The List

• Baking Supplies
• Asparagus
• Antibiotics
• Maple Syrup
• Dijon Mustard
• Baby Formula Mix
• Salmon
• Lentils
• Vanilla
• Mango
• High-Quality Beef Cuts
• Winter Clothing
• Grapes
• Pet Food
• Sweet Potatoes

Nobody understands that this crisis has started. But believe me, it has. This was the way the 2008 financial crisis started. It didn’t just happen when Lehman Brothers went bankrupt.”

By the time Lehman went under, everybody knew there was a crisis. But it was obvious long before that.

That’s the reason it went under. It didn’t just go out of business out of the dark. It wasn’t just happenstance. The reason that Lehman Brothers, and Bear Sterns, and Fanny and Freddy, and AIG, and all these companies went under was their exposure to the mortgage market. That exposure was obvious to me for years, but particularly in 2007 when the subprime market blew up. That was the point where even the village idiot should have been able to figure out what was coming. The problem was most people on Wall Street weren’t even smart enough to qualify as the village idiot, so they still couldn’t figure it out.”

They needed the proverbial anvil to fall on their head. That finally happened in 2008. But even in the summer of ’08, a lot of people were oblivious.

So, if you’re wondering, ‘Peter, how can we be so close to this massive crisis, in fact, how could this crisis have already started if nobody is talking about it?’ Well, just go back to the summer of 2008. Nobody was talking about it.”

Peter emphasized that this crisis is much bigger because the problems driving it are much bigger.

They’re the same problems. They just dwarf the size of the problems we had before. Because instead of actually dealing with the problems, we kicked the can down the road and made the problems bigger. Now we have to deal with the consequences of that.”

Fed officials keep saying that the banking system is “sound.” But Peter said all of the big banks are insolvent.

Now, as long as they pretend that all their underwater assets, they’re going to hold them to maturity, well, they can pretend that they don’t have a problem. But eventually, they have to stop pretending because circumstances intervene, and they actually need to sell the securities that they had intended to hold to maturity.”

Newsweek recently published an article titled “America Is Heading for an Interest Payment Crisis.” Peter noted that at least they’re writing about that, but they still miss the root of the problem. It’s not just the interest. It’s also the principal.

A lot of people claim the principal doesn’t matter. As long as the US can make interest payments, everything is fine. But as Peter pointed out, the national debt wasn’t a gift. It’s debt. But it’s nature it has to be paid back.

So, when they would say, ‘We don’t have to repay the debt,’ I would say, ‘Well, did you run that by the Chinese? Did you run it by the Japanese? Do they know that that’s the deal? Do they know that they’re loaning us money but they’re never going to get it back?’ Because that’s not a loan. That is a gift.”

Of course, the response is always, “We can just borrow from somebody else to pay it back.”

In other words, it’s a Ponzi scheme. So, Bernie Madoff never had to worry about paying back money because he would get it from the next sucker who didn’t realize it was a Ponzi scheme. But what happens when people realize it’s a Ponzi scheme? They don’t want to participate. And that’s what’s going on. Our creditors don’t want to loan us more money to pay back other creditors. That is what is happening. That is why bond yields are going up because the people who own the bonds want their money back as they mature and we can’t find new buyers.”

Rising interest rates impede the solvency of the United States. As rates rise, the Treasury has to borrow even more to keep up with the interest payments. As debt goes up, the US becomes a bigger credit risk. It also becomes more likely that the government and central bank will have to create more inflation to service the debt.

So, higher interest rates don’t actually make Treasuries more attractive. They make them less attractive. That is a problem. This is a bottomless pit. This is a self-perpetuating collapse that we are witnessing that is going to gather momentum.”

During an interview, new House Speaker Mike Johnson claimed that during the Trump years, the US had the greatest economy ever. Peter called that “a lie.”

We didn’t have the greatest economy in the history of the world. It wasn’t even close. We didn’t even have the greatest economy in the history of America. We didn’t have the greatest economy in the 21st century. We had a bubble under Trump. Trump didn’t create the bubble. He inherited the bubble, and he made it bigger. That bubble is now popped.”

You can trace the origins of the bubble all the way back to the Bill Clinton era and the monetary policy initiated by Alan Greenspan. That bubble popped the first time under Bush 2, was reinflated, popped again in 2008, and then they managed to blow it back up again.

The idea that people think everything was great just a few years ago and it’s all gone to hell — that’s wrong because it assumes that we could just fix it, really simple. We just have to go back to the Trump policies and we’re going to be great again. No! This problem is much bigger than just the bad things that Biden has done.”

Peter explained how the Clinton administration started the trend of using shorter-term financing to lower interest payments. They could do that because rates were so low. Of course, that created more risk because rising rates can quickly make those payments skyrocket. That’s where we are today. Interest rates are soaring and all of that short-term debt is maturing. That means the Treasury has to borrow at a much higher rate to replace that debt.

It’s going to escalate into this complete sovereign debt and currency crisis, which is already started, but it’s a long way from ending.”

In this podcast, Peter also explains why the future of the US looks more like Argentina than Japan.

The guy in the White House and his son have made millions of dollars in an epic influence-peddling scheme that stretched over many years, and the mainstream media doesn’t seem to care.  Of course they know exactly what it is like to be bought and paid for, because the only reason the big news networks can survive is because of the millions of advertising dollars that the pharmaceutical industry continues to inject into their dying carcasses.

As Victor Davis Hanson has astutely observed, America was once experiencing a “gradual decline”, but now the fall of our nation “has accelerated at such an astonishing rate we can scarcely recognize our country”…

Twenty-first-century America was on a trajectory of gradual decline—until it began to implode.

Was the accelerant the COVID-19 pandemic and unhinged lockdowns? Or was the catalyst the woke revolution fueled by the 2020 summer of exempted rioting, looting, arson, and violence? Or was it perhaps the deranged fixation on removing Donald Trump from the presidency and destroying the rule of law in the process? Or all that and more?

Now with the election of Joe Biden, what had been a fast-tracked decline has accelerated at such an astonishing rate we can scarcely recognize our country.

I wish that what he is saying wasn’t true.

But it is.

Just a few years ago, organized looting was something that was fairly uncommon.

Sadly, now we have reached a point where groups of people are constantly storming into our major retailers, grabbing whatever they want, and then storming out…

Retail crime is at a record high, and thieves are becoming bolder than ever.

“We’ve just had a lot of stressful situations where me or like one of my coworkers have gotten hit trying to get stuff back,” said Mae McRae, the manager of Las Vegas boutique Eden Sky. “We have people who completely fill up their hands and just run out. No care in the world.”

The riots of 2020 were a real turning point, and retail theft hit the 100 billion dollar mark for the very first time in 2022…

The National Retail Federation found retailers lost approximately $100 billion last year, which is up from $94 billion in 2021 and $91 billion in 2020.

“They’re getting more comfortable with it because we won’t chase after them,” McRae said of shoplifters, noting how many retailers train employees to not go after the shoplifter for safety reasons.

It is being projected that retail theft will be way above the 100 billion dollar mark this year.

Unfortunately, most of our politicians don’t seem interested in solving this crisis.

So large retailers are starting to flee the areas that have been hit the hardest, and that even includes very wealthy cities such as San Francisco…

A slew of companies have indicated in the past few months that they will exit locations in San Francisco’s downtown area, moves AT&T, Westfield and Nordstrom recently said they would also make.

Reports of AT&T’s closure of its San Francisco flagship, located at 1 Powell Street in the Union Square area, first came about late last week. That will take place in August, with the workers getting “offered jobs at one of the many other retail locations in the city,” an AT&T spokesperson told FOX Business on Monday.

Instead of working hard to fix our growing problems, our politicians are busy working hard to win their next elections, and for most of them that means making appearances at the “pride parades” that are taking place all over America this month.

In New York, approximately 100,000 people marched in the Big Apple’s world famous pride parade on Sunday, and it was expected “to draw roughly a million spectators”…

Spotted among the amalgam of drag queens and activists marching down Fifth Avenue were figures like Eric Adams, Kathy Hochul, and Chuck Schumer – three of roughly 100,000 participants taking part in the parade’s main procession.

This year’s march – the 53rd in the city’s history – is expected to draw roughly a million spectators, while featuring some 60 floats that speak to the LGBTQ situation not only in New York, but across the country.

There is absolutely no doubt about where the financial capital of the world stands.

At one point, some participants in the parade began chanting slogans that caused great alarm, but the mainstream media will not be covering this.

Needless to say, the mainstream media will not cover anything that puts such festivities in a bad light. During the Seattle pride parade, men that were fully exposed were allowed to participate. In the old days, that would get you arrested for “indecent exposure”, but in our time we celebrate that sort of a thing.

Of course there were lots of young children along the parade routes in Seattle, New York and in all of the other cities where such parades have been held this month.

Their innocence is being stolen from them. But nobody seems to care, because this is what we have become as a nation. If we were given another 20 or 30 years, what would our society look like? You might want to think about that, because the truth is that time is running out for America.

If we stay on the self-destructive path that we are on, we will reach the end of the road very rapidly, and so let us hope for a great awakening to happen soon.

Michael’s new book entitled “End Times” is now available in paperback and for the Kindle on Amazon.com, and you can check out his new Substack newsletter right here.

Article cross-posted from End of the American Dream.

We are in the early stages of a global economic collapse, and people all over the globe are getting extremely angry.  Here in the United States, higher prices are an inconvenience, but in other parts of the world higher prices can mean the difference between feeding your family or not.

And once people get to a point where they cannot even survive on the incomes that they are bringing in, they can become very unpredictable and very violent.

For example, a large economic protest that just happened in Lebanon quickly descended into violence as protesters aggressively clashed with government security forces…

Although the protest began peacefully, demonstrators clashed with security forces, who repeatedly shot tear gas into the crowd after demonstrators breached the barbed wire in front of the government building.

“It’s not just our salaries, we’re fighting for our lives,” a retired officer told The National after escaping a cloud of tear gas.

“After serving our country for over 30 years, we can’t even live off our pensions,” he said.

Cries of “Shame on you!” could be heard as protesters ran from the smog of tear gas.

We are seeing similar protests in the western world.  On Sunday, an absolutely massive protest in Prague called on government leaders to resign because of “high inflation and energy prices”…

Thousands of people rallied again in the Czech capital, Prague, on Sunday calling on the government to resign as they protested against high inflation and energy prices.

It was the second such rally in the central Wenceslas Square, called for by a new non-parliamentary political party PRO, which in English stands for Law, Respect, and Expertise.

“We want to express our disapproval of this government, of the political situation, of what’s going on in the Czech Republic and in fact in the whole of Europe,” said one protestor, Renata Urbanova.

Unfortunately, economic protests such as these have become quite common over the past year.

In fact, one team of researchers determined that there were 12,500 such protests during 2022…

Last September, Italians in Rome, Milan and Naples burned their energy bills in a coordinated protest against soaring prices. In October, thousands took to French streets to decry government inaction over the high cost of living. And in November, Spanish workers rallied for higher wages, chanting “salary or conflict.”

Researchers have defined an unprecedented global wave of more than 12,500 protests across 148 countries over food, fuel and cost of living increases in 2022. And the largest were in Western Europe.

Will that number be even higher in 2023?

All over the world, people need to eat, and food prices just keep rising.

In March, food prices in the UK rose “at their fastest rate for 45 years”.

And it is now being projected that the global rice shortfall this year will be the largest in 20 years.  That will mean even higher prices for the billions of people that eat rice.

Even here in the United States, food prices are becoming extremely oppressive.  Earlier today, I was stunned to learn that one bakery in New York is actually selling a ham and cheese sandwich for 29 dollars.

NYC bakery Eli Zabar was selling a $29 ham & cheese sandwich… but DON'T WORRY, it was on "health bread" pic.twitter.com/WKDujaWNOC

— Andrea Mew (@andreajmew) April 12, 2023

Can you believe that?

Up until just recently, we haven’t seen economic protests in North America like we have around the rest of the world, but that has started to change.

Right now, approximately 155,000 government workers in Canada have gone on strike because the cost of living has been rising much faster than their paychecks have…

The mushroom cloud of central bank monetary destruction keeps growing, and is increasingly fueling discontent among workers whose standards of living are eroding along with the purchasing power of their wages.

Europe has already seen a wave of strikes aimed at securing inflation-offsetting pay raises. Now it’s Canada’s turn: At midnight, more than 155,000 Canadian federal government workers went on strike in what’s being described as the largest walkout against a single employer in the country’s history.

The strike was called by the Public Service Alliance of Canada (PSAC) union, which has been in negotiations for a new contract since 2021. This strike primarily encompasses two groups of federal employees: 120,000 at the Treasury Board and 35,000 at the Canada Revenue Agency (CRA).

No matter who you are or where you live, you can see that the cost of living is rising at a very alarming pace. And that isn’t likely to change any time soon.

In the U.S., one recent survey discovered that a whopping 67 percent of all Americans believe that their incomes are falling behind inflation…

Continual inflation has hurt Americans, with roughly two-thirds of them reporting their wages cannot keep up, according to the most recent CNBC All-America Economic Survey.

Only 5% of Americans say their household income is outpacing inflation, with 67% stating it is falling behind and 26% saying it is keeping up, according to CNBC. The vast majority of the public is adjusting their spending habits and lifestyles due to inflation, with 81% saying they are taking measures like reducing entertainment spending and travel or dipping into savings to cover expenses.

The Federal Reserve has been rapidly increasing interest rates in a desperate attempt to contain inflation, but those higher rates have pushed us into a very serious economic downturn.

Large companies are laying off workers all over America, and that list includes Disney and Facebook…

This year, 596 tech firms have laid off 171,308 workers. The list is anticipated to expand, with Meta Platforms Inc. initiating job cuts today and Walt Disney Co. preparing to reduce its workforce by thousands in the coming week.

According to an internal memo seen by Bloomberg, the Facebook parent company told managers they should prepare for job cuts on Wednesday. The memo states jobs across Facebook, WhatsApp, Instagram, and Reality Labs will be affected.

The move to reduce headcount by at least 10,000 positions at the company was outlined by founder Mark Zuckerberg’s goal of greater efficiency earlier this year. Another round of job cuts is expected next month.

I know that I have covered an enormous amount of material very quickly in this article. But people need to understand the seriousness of what we are now facing. It isn’t just the U.S. economy that is in trouble. The entire global system is beginning to shake and tremble, and eventually it will completely implode.

According to Google, there are currently 7.888 billion people living on this planet. Approximately half of those people live on $6.85 or less a day.

Poverty and hunger are rapidly growing all over the world, and we are going to witness so much pain and suffering in the months and years ahead.

But most people don’t understand any of this, because the mainstream media just continues to insist that everything will work out just fine somehow.

Michael’s new book entitled “End Times” is now available in paperback and for the Kindle on Amazon.com, and you can check out his new Substack newsletter right here.

Article cross-posted from End of the American Dream.

Last week, amid a rash of bank insolvencies, government agencies took action to stem a potential banking crisis. The FDIC, the Treasury, and the Fed issued a Bank Term Lending Program with a $25 billion loan backstop to protect uninsured depositors from the Silicon Valley Bank failure. An orchestrated $30 billion uninsured deposit by eleven major banks into First Republic Bank followed. I suggest those deposits would not occur without Federal Reserve and Treasury assurances.

Banks quickly tapped the program, as shown by the $152 billion surge in borrowings from the Federal Reserve. It is the most significant borrowing in one week since the depths of the Financial Crisis.”

Since last week, that number has surged to almost $300 billion.

Since then, UBS entered into a “shotgun marriage” with Credit Suisse, and the Federal Reserve reopened its dollar swap lines to provide liquidity to foreign banks.

The Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the Federal Reserve, and the Swiss National Bank announced on March 19 “a coordinated action to enhance the provision of liquidity via the standing U.S. dollar liquidity swap line arrangements.”

To improve the swap lines’ effectiveness in providing U.S. dollar funding, the central banks currently offering U.S. dollar operations have agreed to increase the frequency of 7-day maturity operations from weekly to daily. These daily operations began on March 20 and will continue at least through the end of April.

Historically, once the Fed opens dollar swap lines, further monetary accommodations follow from rate cuts to “quantitative easing” and other liquidity operations. Of course, such is always in response to a banking crisis, credit-related event, recession, or a combination.

While the “pavlovian response” to a reversal of monetary tightening is to buy risk assets, investors may want to take some caution as recessions tend to follow a banking crisis.

Banking Crisis Cause Recessions

An obvious consequence of a banking crisis is a tightening of lending standards. Given the “lifeblood” of the economy is credit, both consumer and business, the tightening of lending standards reduces that economic flow.

Not surprisingly, when banks tighten lending standards on loans to small, medium, and large firms, liquidity constriction ultimately results in a recessionary drag. Many businesses rely on lines of credit or other facilities to bridge the gap between manufacturing a product or service and collecting revenue.

For example, my investment advisory business provides services to clients for a fee of which we collect one-fourth of the annual fee during each quarterly billing cycle. However, we must meet payroll, rent, and all other expenses daily or weekly. When unexpected expenses arise, we may need to tap a line of credit until the next billing cycle. Such is the case for many firms where there is a delay between the sale of a product or service and the billing cycle and collection.

If lines of credit are withdrawn, businesses must lay off workers, cut expenses, and take other necessary actions. The economic drag intensifies as consumers cut spending, further impacting businesses due to reduced demand. This cycle repeats until the economy slips into a recession.

Currently, liquidity is getting extracted across all forms of credit, from mortgages to auto loans to consumer credit. The current banking crisis is likely the first warning sign of a worsening economic situation.

The last time we saw lending standards contract this much was during the pandemic-driven economic shutdown.

Many investors hope a Fed “pivot” to loosen monetary policy to combat recession risks will be bullish for equities.

Those hopes may be disappointed as recessions initially cause “repricing risk.”

Recessions Cause Repricing Risk

As noted, the bullish expectation is that when the Fed makes a “policy pivot,” such will end the bear market. While that expectation is not wrong, it may not occur as quickly as the bulls expect. When the Fed historically cuts interest rates, such is not the end of equity “bear markets,” but rather the beginning.

Notably, most “bear markets” occur AFTER the Fed’s “policy pivot.”

The reason is that the policy pivot comes with the recognition that something has broken either economically (aka “recession”) or financially (aka “credit event”). When that event occurs, and the Fed initially takes action, the market reprices for lower economic and earnings growth rates.

Forward estimates for earnings remain elevated well above the long-term growth trend. During recessions or other financial or economic events, earnings regularly revert below the long-term growth trend.

A better way to understand this is by looking at the long-term exponential growth trend of earnings. Historically, earnings grow roughly 6 percent from one peak earnings cycle to the next. Deviations above the long-term exponential growth trend are corrected during the economic downturn. That 6 percent peak-to-peak growth rate is derived from the roughly 6 percent annual economic growth. As we showed just recently, and of no surprise, the yearly earnings change is highly correlated to economic growth.

Given that earnings are a function of economic activity, current estimates into year-end are unsustainable if the economy contracts. That deviation above the long-term growth trend is unsustainable in a recessionary environment.

Therefore, given that earnings are a function of economic activity, valuations are an assumption of future earnings. Therefore, asset prices must reprice lower for earnings risk, particularly during a banking crisis.

There are two certainties facing investors.

1. The Fed’s rate hikes started a banking crisis that will end in a recession as lending contracts.
2. Such will force the Fed to eventually cut rates and restart the next “Quantitative Easing” program.

As noted, the first cut in rates will be the recognition of the recession.

The last rate cut will be the one to buy.

Article cross-posted from The Epoch Times.

• Adam Tooze, a financial crisis historian and director of the European Institute at Columbia University, warns the world is facing a “polycrisis” — a perfect storm of multiple global socioeconomic influences
• Polycrisis is not merely the presence of several crises at once. Rather, it refers to a situation where the whole is more dangerous than the sum of the parts, as each individual crisis escalates, compounds and worsens other simultaneous crises
• Tooze predicts several crises may erupt and converge over the next six to 18 months, including a food crisis, pandemic outbreaks, stagflation, a Eurozone sovereign debt crisis and potential nuclear war
• While a majority of economists are optimistic and predict only a mild and temporary recession to hit the United States in 2023, real-time evidence doesn’t look good. Consumer spending, domestic investments, mortgage applications, manufacturing and U.S. railroad cyclical cargo loads are all declining, while inflation and interest rates are rising. Consumer sentiment, an indication of people’s confidence in the economy and their willingness to spend, is also tanking at a record rate
• Two strategies that can strengthen individual and local resilience to the stresses facing us are the creation of local food systems and the strengthening of neighborhood and community connections. Both reduce individuals’ reliance on government handouts, and by extension, they’re less likely to be forced into these new Great Reset slave systems

In a recent Substack article¹ Adam Tooze, a financial crisis historian and director of the European Institute at Columbia University,² reviews and explains what he calls the impending “polycrisis of doom” — a perfect storm of global socioeconomic influences that signal trouble ahead.

Big Picture Crisis Modeling

Using charts and “krisenbilder,” i.e., “crisis pictures,” Tooze illustrates the many interconnected stress patterns at play on the global scene. The first graphic below illustrated the situation as of January 21, 2022.

The second graphic below shows the complexity caused by the Russia-Ukraine conflict as of February 24, 2022. As noted by Tooze:³

“What was once a relatively legible map has become a tangled mess … The war has had the impact it has because it has exacerbated existing tensions. Food prices were already rising in 2021 and provoking warnings of a crisis to come.

Energy markets were stressed well before the war broke out. Now both stressors are knotted together with the war. I have highlighted in red what emerge as a series of macroscopic risks, all of which may come to a head in the next 6-18 months.”

Many Crises Are Hitting All at Once

As noted by Tooze, we now face a series of significant challenges, and a) they’re hitting us all at once, and b) several of them reinforce and worsen each other. Also notable is the fact that there’s great uncertainty associated with some of them.

What might be the pandemic potential of new COVID variants? Will the Russia-Ukraine conflict escalate into a nuclear war? There’s really no way to predict with any amount of accuracy how those scenarios will play out. On the other hand, some of these forces offset or ameliorate others but, again, it’s hard to predict the likelihood of them happening.

In the following chart, Tooze summarizes the major crisis points and their likely influence on each other. Note he refers to these interactions as “entirely provisional and highly debatable.”

Indeed, some of his readers point out several additional influences that could be added into the mix, such as the weaponization of the U.S. dollar, the deplatforming of Russia from the SWIFT system, U.S. meddling in the Russia-Ukraine conflict, the push to expand NATO, allowing health agencies to dictate economic policy and much more.

Still, Tooze’s analysis — incomplete as it may be — can be useful for those willing to ponder the potential ramifications of global interactions that may be facing us over the next six to 18 months.

Predictions for 2023-2024

As explained by Tooze, “polycrisis” is not merely the presence of several crises at once. Rather, it’s “a situation … where the whole is even more dangerous than the sum of the parts.”⁴

The reason why the whole ends up being more dangerous than any combination of crises put together is the way they escalate, compound and worsen each other in a symbiotic fashion. And, if Tooze is correct, we may find ourselves smack-dab in the middle of this polycrisis sometime in the next six to 18 months, or 2023 going into 2024. Tooze explains:⁵

“What this matrix helps us to do is to distinguish types of risk by the degree and type of their interconnectedness. The risk of nuclear escalation stands out for the fact that it is not significantly affected by any of the other risks.

It will be decided by the logic of the war and decision-making in Moscow and Washington. A food crisis does not make a nuclear escalation any more, or less likely. On the other hand, a nuclear escalation would, to say the least, dramatically escalate several of the other risks.

Continuing inflation will likely function as a driver of several other risks, but those risks in turn (COVID, recession, EZ sov debt crisis) will likely deescalate the risk of inflation.

I would not say that this is a forecast, but it does bias me towards thinking that inflation will be transitory. Most of the big shocks that we may expect, tend to be deflationary in their impact.

Conversely, a recession seems ever more likely in part because the effect of most of the bad shocks we may expect — from COVID, mounting inflation, or a fiscal deadlock in Congress — point in that direction.

The obvious next step is to ask whether the feedback loops in the matrix are positive or negative. So, for instance, a recession makes a Eurozone sovereign debt crisis more likely, which in turns would unleash serious deflationary pressures across Europe.

Conversely, inflation in fact seems self-calming. The effects it produces tend rather the dampen inflation than to feed an acceleration. At least as I have specified the matrix here.

A global hunger crisis seems alarmingly likely in part because all the other major risks will exacerbate that problem. A hunger crisis, however, will largely affect poor and powerless people in low-income countries, so it is unlikely to feedback in exacerbating any of the other major crises.

It is an effect of forces operating elsewhere, rather than itself a driver of escalation. To this extent the matrix becomes a way of charting the power hierarchy of uneven and combined development. Some people receive shocks. Others dish them out.”

Near-Term Outlook for the US Economy

In a July 1, 2022, Substack article,⁶ Tooze takes a deeper dive into the more near-term outlook for the United States specifically. The Federal reserve is now tightening its monetary policy “more steeply than at any time since the early 1980s,” while inflation remains “stubbornly high” at the same time.

The question on everyone’s mind is, are we in a recession, and might it worsen into a depression? Recession is when a country experiences a decline in Gross Domestic Product (GDP) for two consecutive quarters, while a depression is characterized by more long-term reductions in economic activity.

According to the National Bureau of Economic Research, the U.S. was officially in recession as of February 2020.^7,8 When the economy grew 5.7% in 2021, a rebound was declared,⁹ but then the GDP dropped again, first by an annual rate of 1.6% in the first quarter of 2022, followed by a negative 2.1% in the second quarter,¹⁰ which technically placed the U.S. in recession territory yet again.

Tooze notes that a majority of economists are optimistic and predict only a mild and temporary recession to hit in 2023, but real-time evidence doesn’t look good. As of early July 2022, consumer spending, domestic investments, mortgage applications, manufacturing and U.S. railroad cyclical cargo loads are all declining, while inflation and interest rates are rising.^11,12

Consumer sentiment, an indication of people’s confidence in the economy and their willingness to spend, is also tanking at a record rate.¹³ Tooze ends his review stating:

“All told, you might say that this is a gloomy outlook. And there are those who are increasingly skeptical of the possibility of a soft landing. But, it is surely far too early to tell.

If the aim of the game is to control inflation by bringing about a slowdown, then the evidence we are seeing, so far, is precisely what you would look for. What remains to be seen is how the different recessionary forces interact, and whether they brew up into really heavy weather.”

Two Strategies to Strengthen Your Resilience

While we may not be able to accurately predict just how bad the situation will get, it seems prudent to say that we’re all facing some hard times. One factor that Tooze does not include in any of his analyses is the now-apparent fact that some of these crises are intentionally manufactured, with the goal of breaking apart and dismantling current systems in order to justify the introduction of entirely new systems.

The financial system and the food system are two key examples where intentional deconstruction appears to be taking place. Basically, what the technocratic elitists who fancy themselves rulers of the world intend to argue is that because the systems are no longer working, they must be “built back better.”

However, the new systems will in no way, shape or form benefit the population at large. This is true globally, not just in the United States. These new systems, delineated under the flag of The Great Reset, are slave systems which, when networked together, will form a virtual digital prison.

Every person on the planet will be under their collective thumb, as the technocrats will own everything while the rest of humanity will be allocated resources such as food and energy based on obedience criteria.

The good news is that more and more people are waking up to what this “deep state” cabal is up to, and that’s another wild card that can upend things and, hopefully, lessen the impacts of some of these crises. Two strategies that can strengthen individual and local resilience to the stresses facing us are the creation of local food systems¹⁴ and the strengthening of neighborhood and community connections.

By building a strong local food system, you reduce food insecurity, and by building a community network of specialists, you reduce the effects of a crumbling financial system as you can simply barter goods and services.

Social cohesion also offers many psychological benefits.¹⁵ Local food systems and community networks both also reduce individuals’ reliance on government handouts, and by extension, they’re less likely to be forced into these new Great Reset slave systems.

How to Build a Local Food System

As explained by Brian Williams, a former local food planner in Columbus, Ohio, in a 2017 StrongTown article,¹⁶ building a strong local food system goes beyond community gardens, farmer’s markets and community-supported agriculture (CSA) shares.

While these are valuable gateways, they don’t go far enough. He provides several excellent suggestions for those willing to spearhead a local food movement in their own hometown, including the following. Williams includes several other suggestions, which you can read through in his article, but these are some of the central ones:¹⁷

• Secure local-purchasing commitments from schools, hospitals, colleges, restaurants, local grocers and other institutions — Such commitments are crucial for developing the necessary infrastructure for a strong local food market.

When you have demand from large institutions, you can then bring farmers, food processors and distributors into a complete supply chain network, as the contracts will be large enough to support everyone and make the endeavor financially viable.

• Enlist support from existing food processors and distributors — Many small-scale, family-run businesses struggle to make ends meet, and may be more than willing to become part of your local network. Two key components are slaughterhouses and trucking companies to distribute the food from one place to another. But you also need food processors that can wash, pack and dice or cut the food.

• Build a network of local farmers willing to collaborate — Individual farmers may not be able to meet the demands of large contracts, but pooling the output from several farms might.

• Build the economic infrastructure — If certain services are not available, determine what’s needed and put out a call out to the community. You never know who might be willing to start a company to fill a local need.

Keep in mind that financial productivity is key for making a local food system work. Everyone involved must benefit financially, or the system won’t be sustainable. The good news is that a local network keeps the money inside the community, and it’s easier to stay financially viable when nothing is being siphoned off to out-of-state players that don’t spend their earnings within your community.

• Build relationships with local public health officials, economic development officials, legislative representatives and bankers — As noted by Williams, “Public health officials … regulate local food-related businesses. If their regulation seems too rigid or unrealistic, economic development experts can help iron out the details and look for other opportunities.

Food banks already have trucks and are possible partners in distribution challenges. Bankers have money to lend to farmers who want to expand, distributors who need another truck, and processors that are growing to meet demand.”

• ^{1, 3, 4, 5} Adam Tooze Substack June 24, 2022
• ² Institute for Economic Thinking, Adam Tooze Bio
• ^6, 12, 13 Adam Tooze Substack July 1, 2022
• ⁷ HKS.Harvard.edu June 16, 2020
• ⁸ NPR June 8, 2020
• ⁹ MSN January 27, 2022
• ^10, 11 CNBC July 1, 2022
• ¹⁴ Treehugger October 11, 2018
• ¹⁵ NPR January 3, 2013
• ^16, 17 StrongTown August 7, 2017

Property prices have fallen by up to 20 percent across parts of the US as buyers shun the market amid ‘Bidenflation’ and spiking interest rates.

Asking prices have plummeted by up to $400,000 in wealthy areas while poorer neighborhoods have seen house values nosedive by as much as $115,000.

Do you remember last time around when millions of homeowners ended up “underwater” on their mortgages?

If we continue on this current trajectory, it is going to happen again.

Last year at this time, the housing market was extremely hot, but now a new report from Redfin is telling us that things have dramatically changed…

A May study by Redfin found that about 19 percent of sellers dropped the prices on their homes in a four week period between April and May. The outlet said that the report indicated an end to the country’s pandemic-era housing boom.

Their report found that Google searches for ‘homes for sale’ were down 13 percent from the same time last year.

It also found that requests for home tours were down 12 percent, and that mortgage applications dropped 16 percent from a year prior.

And the higher mortgage rates go, the worse things are going to get.

Unfortunately, mortgage rates are spiking at a rate that is absolutely breathtaking this month…

Mortgage rates jumped sharply this week, as fears of a potentially more aggressive rate hike from the Federal Reserve upset financial markets.

The average rate on the popular 30-year fixed mortgage rose 10 basis points to 6.28% Tuesday, according to Mortgage News Daily. That followed a 33 basis point jump Monday. The rate was 5.55% one week ago.

The last time we saw mortgage rates this high was during the last housing crash.

Unfortunately, they are only going to go higher because the Federal Reserve wants interest rates throughout our economy to rise in order to fight inflation.

But as I have warned repeatedly in recent months, a high rate environment is going to absolutely eviscerate the housing market.  Already, higher rates have had a colossal impact on home affordability…

Higher home prices and rates have crushed home affordability.

For instance, on a $400,000 home, with a 20% down payment, the monthly mortgage payment went from $1,399 at the start of January to $1,976 today, a difference of $577. That does not include homeowners insurance nor property taxes.

It also does not include the fact that the home is about 20% more expensive than it was a year ago.

Vast multitudes of potential home buyers will be forced out of the market until home prices comes down dramatically.

If you are one of those people, you could try to rent a place while you wait, but apartment rents are 15 percent higher than they were a year ago…

A new report from Redfin shows that nationally listed rents for available apartments rose 15% from a year ago. And the median listed rent for an available apartment rose above $2,000 a month for the first time.

Rents are up more than 30% in Austin, Seattle, and Cincinnati. In Los Angeles the median asking rent is $3,400. Even in formerly affordable cities such as Nashville it’s now $2,140, up 32% from last year.

I am so thankful that Redfin gives us these numbers, but it turns out that Redfin is in deep trouble too.

In fact, Redfin just announced that they will be laying off 8 percent of their workers…

Real estate firms Redfin and Compass are laying off workers, as mortgage rates rise sharply and home sales drop.

In filings with the Securities and Exchange Commission, Compass announced a 10% cut to its workforce, and Redfin announced an 8% cut.

Shares of both companies fell Tuesday. Redfin’s stock touched a new 52-week low.

So many of the exact same things that we witnessed back in 2008 are happening again.

The economy is slowing down.

Big corporations are starting to lay off workers.

Home prices are starting to collapse.

And there is a tremendous amount of pessimism about what is ahead.  In fact, one new survey has found that small business owners are “feeling their gloomiest in nearly five decades”…

Small business owners in America are feeling their gloomiest in nearly five decades, a survey released Tuesday morning showed.

The National Federation of Independent Business (NFIB) said its gauge of businesses expecting better business conditions over the next six months fell to the worst reading in the 48-year history of the survey.

When things got really bad in 2008 and 2009, the Federal Reserve responded by pushing interest rates all the way to the floor, and that certainly helped.

But now the Federal Reserve doesn’t have that option.

In fact, the Federal Reserve seems quite determined to dramatically raise rates in a desperate attempt to fight the inflation monster that they had a major role in helping to create.

And the higher that rates go, the worse things will get for the housing market and for the economy as a whole.

If we would have learned some lessons from the last crisis, all of this could have been avoided.  But instead we are now moving into a future which is going to be extraordinarily painful.

At this point, the Federal Reserve is stuck between a rock and a hard place. If they don’t raise rates, inflation will continue to spiral out of control.

But if they do raise rates, they will crush the housing market and make the coming recession far worse.

For years, they assured all of us that they had everything under control and that they knew exactly what they were doing.

Now everyone can see the truth, but unfortunately it is too late to reverse course.

***It is finally here! Michael’s new book entitled “7 Year Apocalypse” is now available in paperback and for the Kindle on Amazon.***

Image by Nicolas DEBRAY from Pixabay. Article cross-posted from Michael’s blog.

For weird reasons, some people, many people, imagined that governments could just shut down an economy and turn it back on without consequence. And yet here we are.

Historians of the future, if there are any intelligent ones among them, will surely be aghast at our astounding ignorance. Congress enacted decades of spending in just two years and figured it would be fine. The printing presses at the Fed ran at full tilt. No one cared to do anything about the trade snarls or supply-chain breakages. And here we are.

Our elites had two years to fix this unfolding disaster. They did nothing. Now we face terrible, grim, grueling, exploitative inflation, at the same time we are plunging into recession again, and people sit around wondering what the heck happened.

I will tell you what happened: the ruling class destroyed the world we knew. It happened right before our eyes. And here we are.

Last week, the stock market reeled on the news that the European Central Bank will attempt to do something about the inflation wrecking markets. So of course the financial markets panicked like an addict who can’t find his next hit of heroin. This week already began with more of the same, for fear that the Fed will be forced to rein in its easy-money policy event further. Maybe, maybe not; but recession appears impending regardless.

The bad news is everywhere. Even in the midst of very tight labor markets and very low unemployment (mostly mythical when you consider labor force participation), companies have started to lay off workers. Why? To prepare for recession and the prospect of more economic chaos ahead.

High-flying tech giants are curbing their enthusiasm too. Facebook apparently got tricked into paying bigtime news outlets to let FB users have free access to articles — no doubt to those that reinforced government propaganda, since Mark Zuckerberg volunteered his entire company to be messengers for the regime back in 2020. FB got robbed and is now rethinking. No more freebies.

This might as well be the theme of American life. No more charity. No more kindness. No more doing something for nothing. In inflationary times, everyone becomes more grasping. Morality takes a back seat and generosity is no more. It’s every man for himself. This can only get more brutal.

There was something of a psychological break last Friday on the news of the CPI. It was not better than last month. It was not the same as last month. It was worse: 8.6% year-over-year, the worst it has been in 40 years. Honestly, everyone sort of knew this already in their heart of hearts but there is something about the official announcement that codified it.

But let’s say we stack the data at two years rather than one year. What does it look like? It comes in at 13.6%. We have never seen anything like that. And it is truly starting to hurt as never before. Gas is above $5 and rents are more than $2,000 a month on average. The raises at work have stopped coming too. On the contrary, employers are expecting more productivity for ever less money in real terms.

Prices have a very long way to go to wash out the paper sloshing around the world economy. Here is the wave of printing compared with current price trends. No way is this getting better before it gets much worse.

Put it all together, especially with declining financials, along with supply-chain breakages and other economic dislocations, and this is why it feels like the walls are closing in. It’s because they are. And there truly is no way out for anyone at this point.

No one should be shocked by any of this. It was all in the cards, an outcome guaranteed by ghastly policy over two presidential administrations, all enacted by a government that knows nothing about economics and cares nothing for basic commercial and human rights. You dispense with these things and you court disaster.

And this is how you get the worst consumer confidence rating ever recorded.

What makes today different from the 1970s is the pace at which this has all unfolded. Even a year ago, administration officials were claiming that everything would be just fine. Many people believed them, despite every bit of data pointing to exactly the opposite. Truly it feels like our lords and masters believe that their fantasies are more reality than reality itself. They say it and it somehow becomes true.

Can you imagine that only last month, the Biden administration concocted the idea of establishing a “Disinformation Governance Board”? It was designed to script the truth to all social media and mainstream media outlets, censoring all dissent. The plan blew up only because it was too overtly Orwellian for public consumption. What matters here is the intent, which is nothing short of totalitarian.

Politics is good fun for many people, a real sport and a good distraction from real life. But politics becomes a very serious business once personal finance makes the good life ever less viable. Right now everyone is searching for someone to blame and most people have hit on the old guy in the White House, who they somehow believe should do something about all these problems despite a lifelong career of knowing nothing and doing nothing about anything.

What an astounding thing to see unfold before our eyes, and so quickly! The “malaise” of 1979 was a long time coming but the meltdown of 2022 has hit many people like a hurricane that somehow evaded detection from the radar. And yet it might be far from over.

In 2020 and following, money appeared like magic in bank accounts all over the country. A third of the workforce had gotten used to languishing at home, pretending to work. Students started Zooming instead of learning. Adults who had spent a lifetime embracing the normal disutilities of labor gained for the first time a vision of a life of luxury without work.

One result was a huge boom in personal savings, if only for a brief time. Some of the money was spent on Amazon, streaming services, and food delivery but also much of it landed in bank accounts as people started saving money as never before, most likely because the opportunities to spend on entertainment and travel dried up. Personal savings soared to over 30 percent. It felt like we were all rich!

That feeling could not last. Once the economy opened up again, and people were ready to get out and spend their new riches, a strange new reality presented itself. The money they thought they had was worth far less. Also there were strange shortages in goods they once took for granted. Their new riches turned into vapor in a matter of months, with each month worse than the previous month.

As a result, people had to deplete their savings and turn to debt finance just to keep up with the decline in purchasing power, even as their income in real terms turned dramatically south. In other words, government took away what it gave.

The long period of denial seems suddenly over. People of all political persuasions are fuming in anger. The crime everywhere these days is not incidental or accidental. It is a mark of civilizational decline. Something has to give and will give at some point. The ruling class in this country and their friends around the world have caused tremendous wreckage.

Here is the purchasing power of the dollar since 2018. Behold what our rulers have done!

And yet, what do our rulers have to say to us? They tell us to rely more on wind and sun — Janet Yellen’s exact words to the Senate last week. I used to think she was a smart cookie but I guess power turns even good minds to mush. Mush is exactly what they have created out of a once prosperous and hopeful nation.

The most frustrating aspect of all of us is the rampant failure to connect cause and effect. The cause should be clear: this was all kicked off by the most egregious, arrogant, irresponsible, foodhardy, and brutal policies ever perpetrated on the whole of American life, all in the name of disease control. I’ve yet to see evidence that any of the people and agencies who did this to us are willing to reassess their decisions. Quite the contrary.

There must be a reckoning. It was not the poor, the working classes, or the person on the street who did this. These policies were not an act of nature. They were never even voted upon by legislatures. They were imposed by men and women with unchecked administrative power under the mistaken belief that they had it all under control. They never did and they do not now.

About the Author

Jeffrey A. Tucker is Founder and President of the Brownstone Institute and the author of many thousands of articles in the scholarly and popular press and ten books in 5 languages, most recently Liberty or Lockdown. He is also the editor of The Best of Mises. He writes a daily column on economics at The Epoch Times, and speaks widely on topics of economics, technology, social philosophy, and culture.

Image by Andreas Lischka from Pixabay. Article cross-posted from Brownstone Institute.