They were able to delay the U.S. economy’s day of reckoning, but they were not able to put it off indefinitely. During the pandemic, the Federal Reserve pumped trillions of dollars into the financial system and our politicians borrowed and spent trillions of dollars that we did not have. All of that money caused quite a bit of inflation, but it also created a “sugar rush” for the economy. In other words, economic conditions were substantially better than they would have been otherwise. Unfortunately, there will be a great price to be paid for such short-term thinking. From the federal government on down, our entire society is absolutely drowning in debt, and now it appears that our economic problems are about to go to the next level.
In early 2024, there are all sorts of signs that economic activity in the U.S. is really starting to slow down.
For example, we just learned that consumer spending “fell sharply” during the month of January…
Consumer spending fell sharply in January, presenting a potential early danger sign for the economy, the Commerce Department reported Thursday.
Advance retail sales declined 0.8% for the month following a downwardly revised 0.4% gain in December, according to the Census Bureau. A decrease had been expected: Economists surveyed by Dow Jones were looking for a drop of 0.3%, in part to make up for seasonal distortions that probably boosted December’s number.
However, the pullback was considerably more than anticipated. Even excluding autos, sales dropped 0.6%, well below the estimate for a 0.2% gain.
Sadly, the truth is that U.S. consumers just don’t have as much money to spend these days.
They are up to their eyeballs in debt, and delinquency rates have been spiking.
Many consumers are tightening up on their finances, and so it shouldn’t be a surprise that Disney+ lost more than a million subscribers during the fourth quarter of last year…
Disney+ Core subscribers (which include U.S. and Canada customers, as well as international users, excluding the India-based Disney+ Hotstar) dropped to 111.3 million from the 112.6 million reported in the previous quarter, according to Disney’s quarterly earnings results released Wednesday.
In early 2024, we have also seen large employers ruthlessly slash payrolls all over the nation.
The following summary of some of the most shocking layoffs that we have seen recently comes from Zero Hedge…
1. Twitch: 35% of workforce
2. Roomba: 31% of workforce
3. Hasbro: 20% of workforce
4. LA Times: 20% of workforce
5. Spotify: 17% of workforce
6. Levi’s: 15% of workforce
7. Xerox: 15% of workforce
8. Qualtrics: 14% of workforce
9. Wayfair: 13% of workforce
10. Duolingo: 10% of workforce
11. Washington Post: 10% of workforce
12: Snap: 10% of workforce
13. eBay: 9% of workforce
14. Business Insider: 8% of workforce
15. Paypal: 7% of workforce
16. Okta: 7% of workforce
17. Charles Schwab: 6% of workforce
18. Docusign: 6% of workforce
19: CISCO: 5% of workforce
20. UPS: 2% of workforce
21. Blackrock: 3% of workforce
22. Paramount: 3% of workforce
23. Citigroup: 20,000 employees
24. Pixar: 1,300 employees
During the pandemic we witnessed a lot of temporary layoffs, but the last time we saw large corporations conducting permanent mass layoffs on such a widespread basis was in 2008 and 2009.
And we all remember what happened back then.
Meanwhile, the cost of living continues to rise faster than paychecks.
For example, it is being reported that the cost of auto insurance has been increasing at “the fastest annual rate on record”…
The cost of auto insurance jumped 1.4% in January, bringing the total annual gain to 20.6% – the fastest annual rate on record. When compared with early 2019, motor vehicle insurance is nearly 40% more expensive. Experts say the problem could soon get worse before it begins to improve.
Needless to say, most Americans have not seen their paychecks increase by 20.6 percent over the past year.
Of course just about everything else has been rapidly getting more expensive too, and that isn’t going to change any time soon.
On top of everything else, we are also facing an unprecedented commercial real estate crisis.
Our financial institutions are sitting on mountains of bad commercial real estate loans, and Kevin O’Leary is warning that “thousands more” will fail within the next three to five years…
Regional banks are doomed.
That’s not necessarily a bad thing… if you’re prepared for it.
It’s been almost a year since Silicon Valley Bank (SVB) collapsed in March – the victim of idiotic management. But the sobering reality is the small banking crisis is far from over.
In the next three to five years, thousands more regional institutions will fail. That’s why I don’t have a dime saved or invested in a single one.
Is Kevin O’Leary right about this?
I don’t know.
We will just have to wait and see what happens.
But without a doubt, things certainly do not look good at this moment.
Needless to say, it isn’t just the U.S. that is experiencing economic turbulence these days.
This week, we learned that the Japanese economy has officially entered a recession…
Japan has lost its spot as the world’s third-largest economy to Germany, as the Asian giant unexpectedly slipped into recession.
Once the second-largest economy in the world, Japan reported two consecutive quarters of contraction on Thursday — falling 0.4% on an annualized basis in the fourth quarter after a revised 3.3% contraction in the third quarter. Fourth-quarter GDP sharply missed forecasts for 1.4% growth in a Reuters poll of economists.
The Germans are facing big problems too.
In fact, Germany is being called the “sick man of Europe” right now.
Interestingly, it is at this time that Jeff Bezos has decided to sell off billions of dollars worth of Amazon stock…
Amazon’s billionaire founder Jeff Bezos has sold another $2bn worth of the company’s stock, bringing the total value of shares he has offloaded in the past week to $4bn, according to regulatory filings.
An Amazon filing on Tuesday showed that Bezos, who stepped down as the Seattle-based company’s chief executive in 2021 but remains executive chair, sold 12mn shares for about $2bn between Friday and Monday.
He certainly doesn’t need the cash.
So why is he doing this?
Does he know something that the rest of us do not?
I don’t think so.
Instead, I think that he can see what the rest of us can see.
Stock prices have risen to record highs even as the overall economy is clearly heading into a major downturn.
That makes this the perfect time to sell.
Jeff Bezos didn’t get to where he is by being stupid. He can see what is coming and he is getting out while the getting is still good.
Michael’s new book entitled “Chaos” is available in paperback and for the Kindle on Amazon.com, and you can check out his new Substack newsletter right here.
About the Author: Michael Snyder’s extremely controversial new book entitled “Chaos” is available in paperback and for the Kindle on Amazon.com. He has also written seven other books that are available on Amazon.com including “End Times”, “7 Year Apocalypse”, “Lost Prophecies Of The Future Of America”, “The Beginning Of The End”, and “Living A Life That Really Matters”. (#CommissionsEarned) When you purchase any of Michael’s books you help to support the work that he is doing. You can also get his articles by email as soon as he publishes them by subscribing to his Substack newsletter. Michael has published thousands of articles on The Economic Collapse Blog, End Of The American Dream and The Most Important News, and he always freely and happily allows others to republish those articles on their own websites. You can connect with Michael on YouTube, Facebook and Twitter, and sharing his articles on your own social media accounts is definitely a great help. These are such troubled times, and people need hope. John 3:16 tells us about the hope that God has given us through Jesus Christ: “For God so loved the world, that he gave his only begotten Son, that whosoever believeth in him should not perish, but have everlasting life.” If you have not already done so, we strongly urge you to invite Jesus Christ to be your Lord and Savior today.
This article was originally published on The Economic Collapse Blog . The views expressed in this news alert by the author may not directly represent that of The Official Street Preachers or its editors.
