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Posts tagged ‘Inflation’

Graham: Iran Sanctions ‘Crumbling’.


The nuclear arms agreement between the U.S. and Iran that eased some economic sanctions is “crumbling,” Sen. Lindsey Graham said Thursday, calling on Congress to impose new sanctions against Tehran.

“The sanctions are crumbling,” Graham told Fox News’ “America’s Newsroom.” “I want to put sanctions back on the table to let the Western world know that we’re serious about sanctions. And, let the Iranians know that the pressure is not off.”

Graham said he had 59 co-sponsors for a bill to reimpose sanctions against Iran. He said Sen. Majority Leader Harry Reid wouldn’t allow it to come to the Senate for a vote, and was “making the mistake of a lifetime by not putting sanctions back in place before they crumble.”

“Harry Reid is following [President] Barack Obama’s dictate. Barack Obama’s running the United States Senate,” the South Carolina Republican said.

The U.S. and six world powers agreed with Iran late last year to ease certain economic sanctions on Iran for six months, in exchange for a freeze on some of its nuclear activities.

The sanctions are “collapsing,” Graham said, as indicators showed Iran’s economy was improving dramatically. He said the agreement was doing “nothing to dismantle their nuclear program.”

“The value of the Iranian currency is going up by about 30 percent. Their inflation rate has been dramatically lowered. Over 100 foreign delegations have visited Iran, lining up to do business. Their sales of oil to India have doubled. Their economy is resurging,” he said.

Graham said he was attempting to “reset this before it’s too late,” and pledged to “keep doing this until we get it successful.”

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By Wanda Carruthers

40 Percent of US Workers Make Less Than 1968 Full-Time Minimum-Wagers.


Dollar and Yen
Just how badly in trouble is the U.S. economy? (Tungphoto/Free Digital Photos)

Are American workers paid enough? That is a topic that is endlessly debated all across this great land of ours. Unfortunately, what pretty much everyone can agree on is that American workers are not making as much as they used to after you account for inflation.

Back in 1968, the minimum wage in the United States was $1.60 an hour. That sounds very small, but after you account for inflation, a very different picture emerges.

Using the inflation calculator the Bureau of Labor Statistics provides, $1.60 in 1968 is equivalent to $10.74 today. And of course the official government inflation numbers have been heavily manipulated to make inflation look much lower than it actually is, so the number for today should actually be substantially higher than $10.74. But for the purposes of this article, we will use $10.74.

If you were to work a full-time job at $10.74 an hour for a full year (with two weeks off for vacation), you would make about $21,480 for the year. That isn’t a lot of money, but according to the Social Security Administration, 40.28 percent of all workers make less than $20,000 a year in America today. So that means more than 40 percent of all U.S. workers actually make less than what a full-time minimum wage worker made back in 1968. That is how far we have fallen.

The other day I wrote an article that discussed the transition we are witnessing in our economy right now. Good-paying full-time jobs are disappearing, and they are being replaced by low-paying part-time jobs. So far this year, 76.7 percent of the jobs that have been “created” in the U.S. economy have been part-time jobs.

That would be depressing enough, but what makes it worse is that wages for many of these low-paying jobs have actually been declining over the past decade, even as the cost of living keeps going up. The following is from a recent USA Today article: “In the years between 2002 and 2012, real median wages dropped by at least 5% in five of the top 10 low-wage jobs, including food preparers and housekeepers.”

So, where have the good jobs gone?

Well, there are three long-term trends that are absolutely crushing American workers right now.

First of all, thanks to our very foolish politicians, American workers have been merged into a global labor pool, where they must directly compete for jobs with workers on the other side of the planet that live in countries where it is legal to pay slave labor wages. This has resulted in millions upon millions of good jobs leaving this country. Big corporations can pad their profits by taking a job from an American worker making $15 an hour with benefits and giving it to a worker on the other side of the globe who is willing to work for less than a dollar an hour with no benefits.

Our politicians could do something about this, but they refuse to do so. Most of them are absolutely married to the idea of a one-world economic system that will unite the globe.  Unfortunately, the U.S. economy is going to continue to lose tens of thousands of businesses and millions upon millions of jobs to this one-world economic system.

Secondly, big corporations are replacing as many expensive workers with machines, computers and robots as they possibly can. As technology continues to advance at a blistering pace, the need for workers (especially low-skilled workers) will continue to decrease. Unfortunately, the jobs that are being lost to technology are not coming back anytime soon.

Thirdly, the overall U.S. economy has been steadily declining for more than a decade. If you doubt this, just read this article. As our economy continues to get weaker, the lack of jobs is going to become a bigger and bigger problem.

And as our economy systematically loses good jobs, more Americans are forced to become dependent on the government.

Back in 1979, there was about one American on food stamps for every manufacturing job. Today, there are about four Americans on food stamps for every manufacturing job.

When I first found that statistic, I was absolutely stunned. How in the world can anyone out there deny the U.S. economy is collapsing?

But as I mentioned above, it isn’t just that the number of jobs is not what it should be. The quality of our jobs is declining as well. For example, one study found that between 1969 and 2009, the wages earned by American men between the ages of 30 and 50 declined by 27 percent after you account for inflation.

That is a pretty stunning decline. And it has only accelerated in recent years. Median household income (adjusted for inflation) has fallen by 7.8 percent since the year 2000, and the ratio of wages and salaries to GDP in the United States is near an all-time record low.

Most Americans are finding that their bills just keep going up but their paychecks do not.  This is causing the middle class to wither away, and most families are just trying to survive from month to month at this point. In fact, according to one recent survey, 76 percent of all Americans are living paycheck to paycheck.

So, where do we go from here?

To some people, the answer is simple. They say that we should substantially raise the minimum wage. And yes, that would definitely make life a bit better for lots of low-paid workers out there. But it would also have some very negative side effects. A substantially higher minimum wage would mean higher prices at retail stores and restaurants, and it would also greatly increase the incentive that corporations have to replace American workers with foreign workers or with technology. We already have rampant unemployment in this country, and right now there are more than 100 million working-age Americans who do not have jobs. We certainly don’t want to make that worse.

So, raising the minimum wage would not solve our problems. It would just redistribute our problems.

What we really need to do is to return to the principles that once made this country great. In early America, we protected our markets with high tariffs. Access to the U.S. market was a privilege. Foreign domination was kept out, and our economy thrived.

It is definitely not “conservative,” and it should not be “liberal” to stand by and watch millions upon millions of our good jobs get shipped over to communist China. We need more “economic patriots” in America today, but unfortunately they appear to be a minority at this point.

And once upon a time, the U.S. economy was actually a free-market system where rules, regulations and red tape were kept to a minimum. Our nation blossomed under such a system.

Sadly, today we have become a nation that literally has millions of laws, rules and regulations. The control freaks seem to run everything. In fact, the Obama administration recently forced one small-time magician in Missouri to submit a 32-page disaster plan for the little rabbit he uses in his magic shows for kids. That is a very humorous example, but it is a perfect illustration of how absurd our system has become.

Another thing we could do to turn this around would be to get rid of the Internal Revenue Service and the income tax. Did you know the greatest period of economic growth in U.S. history was during a time when there was absolutely no income tax? If you doubt this, just read this article.

And, of course, probably the most important thing we could do for our economy would be to get rid of the Federal Reserve. The Fed is a massive Ponzi scheme, and it has played a primary role in creating almost every single financial bubble in the post-World War II era.

Right now we are living in the greatest bond bubble in the history of the planet, and when that Fed-created bubble bursts, the pain is going to be absolutely excruciating. In addition, the value of our currency has declined by over 96 percent, and the size of the U.S. national debt has gotten more than 5,000 times larger since the Fed was created. The Federal Reserve is at the very heart of our economic problems, and we desperately need to shut it down.

Unfortunately, our politicians are not even willing to consider these solutions, and most Americans are way too busy watching Toddlers & TiarasHoney Boo Boo and other mindless television programs to be bothered with the real problems our country is facing.

So, needless to say, the great economic storm that is coming is not going to be averted.  Most of the country is still asleep, and most people are going to get absolutely blindsided by the economic nightmare that is rapidly approaching.

Source: CHARISMA NEWS.

MICHAEL T. SNYDER

Michael T. Snyder is a former Washington, D.C., attorney and author of The Beginning of the End.

The REAL Weapon of Government Tyranny.


Written by Damon Geller

As talk of serious gun control dominates our politics and media, many people are warning of an assault on our Second Amendment and the threat of government tyranny if we civilians are disarmed.  Tragically, government tyranny is not a future nightmare; government tyranny is a reality here and now.  And in the 21st century, the tyrants don’t care if we have guns or not.  The weapons they’re using to tyrannize us don’t have a chamber or a barrel – the real weapons of tyranny do not involve guns and cannot be halted by guns.  Rather, the real weapons of tyranny slowly bankrupt us and threaten our future and security.  And there’s only one true “protector” that rises to our defense.

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Taxation by Inflation

While the country is force-fed the fight over gun-control by the media like a poisonous potion, we’re looking at an impending debt BOMB that will inevitably bankrupt this nation, finish-off the gutting of our middle class and our retirees, and ultimately tax everyone to the moon.  The real tyranny people need to be protecting themselves from in a big way is the unchecked tyranny of central banks and their monetary destruction.

The Fed debases your currency on a daily basis to steal wealth through an unfair and unconstitutional taxation called inflation.  Central banks are the monetary cornerstone of an essentially Communist system.   Gun rights may indeed be worth fighting over, but even without gun control, you’re already being subjugated by your own government and The Fed now.  A gun isn’t going to protect you from current monetary tyranny or keep you from having your wealth robbed by a collection of sociopaths that have taken over our political, financial and economic systems.

How Do You Protect Yourself From This Type Of Tyranny?

You move some of your wealth out of government controlled “fiat” currency, which can be printed all day, and into a hard asset that has protected people against government money corruption and government created inflation for thousands of years.  You must hold some hard gold and silver to protect yourself during times like these.

The Debt and Debasement of Currencies will Never Stop

Yes, The Land of The Free is set to impose gun rights restrictions.  I would argue, much more importantly, no one is talking about fiscal restrictions or central bank control.  The United States Government constantly teeters on the verge of defaulting on its mountain of debt.  The German Central Bank has announced that they will withdraw their massive gold holdings from the United States and repatriate it in an unprecedented move that clearly indicates central banks around the world don’t trust each other – and specifically don’t trust the US Federal Reserve or The US Treasury, both of whom have refused to allow gold audits for years.

We exceeded the US debt-ceiling of $16.39 trillion on Jan 1, 2013.  The arguing hasn’t even begun yet, but the Treasury has already said it will begin tapping civil servant retirement fundsbecause Congress has not yet raised the ceiling and we’re BROKE.  For a little history, Gold ran from $1500/oz. to $1900/oz. in a three-month period from June to September, 2011 the last time the politicians had a big fight over a debt ceiling.  The US also came very close to losing its credit rating.  During times of corrupt monetary policy, rogue governments and a corrosion of public confidence in our political, economic and financial systems, one must own the one asset that detaches your wealth from all of them:  hard gold and silver.

They WILL Raise the Ceiling

As Citigroup has predicted, “First Complacency, Then Horror” is the current and common path through these fiscal messes.  Asset markets are likely to ignore the debt ceiling until the last minute, or even later, and then rather than being proactive people, we will be stuck in reactive panic.

There is no choice but to raise the debt ceiling.  And debt is a self-imploding monster with a set path.  The only question is not if but when the DEBT-BOMB explodes.  Raising the debt ceiling (or not raising the debt ceiling) has no effect on spending.  Raising the ceiling simply allows the Treasury to pay for spending that congress has already approved.  The bottom line is, debt cannot be reduced, period.  We don’t pay the compounding interest on our debt; we borrow more money and add it back into the deficit.

The Treasury has debt running up to $28 trillion by 2018.  That’s a $1.5 trillion deficit per year (plus compounded interest) for 6 years.   Gold and gas prices follow debt.  If the cost of gasoline to move your car (or get food to your area) is going to double by 2018 as debt doubles, so will gold.  That means gold is protecting your purchase power against the coming debt bomb and the inflation that will follow.

Here’s the correlation between Debt, Gold and Gas since 2005:

  • 2005 US Debt = 7.6T | Gold = $430/oz. | Gas = $1.82/gallon
  • 2006 US Debt = 8.1T | Gold = $520/oz. | Gas = $2.28/gallon
  • 2007 US Debt = 8.7T | Gold = $635/oz. | Gas = $2.40/gallon
  • 2008 US Debt = 10.7T | Gold = $875/oz. | Gas = $2.90/gallon
  • 2009 US Debt = 10.6T | Gold = $855/oz. | Gas = $1.90/gallon
  • 2010 US Debt = 12.3T | Gold = $1,100/oz. | Gas = $2.80/gallon
  • 2011 US Debt = 14T | Gold = $1,360/oz. | Gas = $3.15/gallon
  • 2012 US Debt = 15.2T | Gold = $1,545/oz. | Gas = $3.40/gallon

And here’s where we’re going:

  • 2013 US Debt = 17T | Gold = $1,875/oz. | Gas = $4.50/gallon
  • 2014 US Debt = 18.8T | Gold = $2,200/oz. | Gas = $5.00/gallon
  • 2015 US Debt = 21T | Gold = $2,600/oz. | Gas = $6.00/gallon
  • 2016 US Debt = 22.7T | Gold = $3,100/oz. | Gas = $6.75/gallon
  • 2017 US Debt = 25.5T | Gold = $3,575/oz. | Gas = $7.50/gallon
  • 2018 US Debt = 28T | Gold = $3,800/oz. | Gas = $9.00/gallon

And so on, with many outside shots of inflation breaking out, banking systems imploding, currencies failing, or any host of black-swan events that could speed this trajectory.

We Have Passed the point of No Return

As a result of our actions, money printing will accelerate at a much faster pace in order to service that debt and keep interest rates low, which will further drive up the debt.  The fact is, debt MUST grow because of compounding interest and spending liabilities, yet it can’t grow forever.  At some point in this debt accumulation process we hit a wall; there’s an “end game.”  That end game is either when the service on our debt exceeds our income or when the rest of the world stops loaning the US money and the Fed can’t possibly print enough money to support the Treasury market.  At that point, rates rise, credit ratings get hit and economic growth literally stops.

Essentially we have passed the point of no return.  We are taking a HUGE portion of this nation’s income just to service the interest on the debt we’ve already incurred.  Yes, rates are very low, but imagine if you had a $17 trillion credit card bill!  Even with rates as low as they can be, the United States spent $133,728,304,681.78 just on interest last year!  Most of that interest in simply compounded, added to the debt number and borrowed against.  So debt WILL keep growing regardless of gun control, debt ceilings, fiscal cliffs, political discord, banking fraud or literally anything else.

Prepare NOW.  There is an End Game

You won’t be worse off for taking control of your retirement. You won’t be worse off for holding some of your hard-earned retirement in hard gold in a jurisdiction where politicians can’t seize it. You won’t be worse off for having some precious metals stashed away close to you and you certainly won’t be worse off for getting at least a meaningful percentage of your wealth out of the “system” and into a hard asset that is not connected to banks, governments, or politicians or that can be debased by central bankers.  Hold some of the one global currencythat has outlasted every paper currency ever invented and has been a wealth preserver for over 5000 years.  You must hold some hard gold and silver in times like these.

Nigeria inflation rises to 9.5 percent in February.


  • A woman waits for customer at a local food market in Nigeria's commercial capital Lagos, January 16, 2012. REUTERS/Akintunde Akinleye

    View PhotoReuters/Reuters – A woman waits for customer at a local food market in Nigeria’s commercial capital Lagos, January 16, 2012. REUTERS/Akintunde Akinleye

ABUJA (Reuters) – Nigerian consumer inflation rose to 9.5 percent in February, from 9 percent in January although still within the central bank‘s single digit target, the statistics bureau said on Saturday.

Food inflation also rose, to 11 percent, from 10.1 percent the previous month, the bureau said.

The central bank will make a decision on interest rates on Tuesday, with most analysts expecting them to be held at 12 percent to support the naira currency, despite inflation now being within the bank’s single digit target for two months in a row.

Lower inflation could increase pressure on the bank to cut rates, but governor Lamido Sanusi has so far resisted it, pointing to the risk of price pressure from external factors like global food prices.

Source: YAHOO NEWS.

Reuters

No let up in social strains as Nigeria keeps growing.


  • A Nigerian oil dealer pours gasoline into bottles at a road-side market in the commercial capital of Lagos October 31, 2008. REUTERS/Akintunde Akinleye

    View PhotoReuters/Reuters – A Nigerian oil dealer pours gasoline into bottles at a road-side market in the commercial capital of Lagos October 31, 2008. REUTERS/Akintunde Akinleye

ABUJA (Reuters) – Nigeria’s economy is expected to grow at a speedy 6.75 percent this year, driven by progress in agriculture, banking and oil, while high inflation rates should ease slightly, data showed on Monday.

Both will add to the reuptation of Africa’s top oil producer as a growing investment destination with a huge consumer market of 160 million peopple. Demand for its sovereign debt, for example, has soared since JP Morgan added it to its emerging bond index last year.

The kidnapping by gunmen of a Briton, an Italian, a Greek and four Lebanese workers in Bauchi state on Sunday, however, underlined that there are risks to investment outlook.

The National Bureau of Statistics forecast this year’s growth to be slightly faster than in 2012, 6.75 percent compared with 6.61 percent.

It said gross domestic product should expand by an average of 7.2 percent next year, 6.9 percent in 2015 and 6.6 percent in 2016, adding that the projections assumed no change to monetary policy, stable fuel prices and a stable external environment.

Social strains, epitomised by the weekend’s kidnapping, may undermine some investor sentiment, however. It was the worst case of foreigners being abducted in the north since an insurgency by Islamists intensified nearly two years ago.

There is also a longer history of kidnapping and oil theft in the southern oil region.

And despite solid growth, the gap between rich and poor is widening, contributing to unrest and violence. Unemployment is 23 percent, while youth unemployment is double that and most people live on less than $2-a-day.

WORKING ON GROWTH

Government pledges to improve infrastructure and support job-creating areas such as agriculture will be key to the economy and stability but reforms have been slow over the last two years, hampered by vested interests and corruption.

Investors have been pleased with the stability brought to monetary policy and the macro-economy in recent months but they remain wary of the government’s tendency to squander its oil windfall on reckless spending and corruption.

Foreign exchange reserves are at more than a 3-year high and the stock index is up around 18 percent this year as investors show faith in local debt markets and the oil, banking and telecommunication sectors.

Plans later this year to rebase Nigeria’s GDP, which have been repeatedly delayed in the past, could push it close to the size of South Africa, the continent’s top economy.

The statistics office said consumer inflation eased to 9 percent year-on-year in January from 12 percent in December, dropping within the central bank’s single-digit target range.

The bank’s governor said last week that he was in no hurry to cut interest rates even if inflation fell.

Food price inflation, the biggest contributor to the headline index, eased to 10.1 percent in January from 10.2 percent, NBS statistics showed.

Source: YAHOO NEWS.

By Joe Brock | Reuters

IMF says Ugandan economy set to grow 6-7 pct in medium term.


KAMPALA (Reuters) – Uganda’s tight monetary stance to combat inflation has sharply slowedeconomic growth but medium-term growth will reach its potential level of 6 percent to 7 percent, theInternational Monetary Fund (IMF) said.

East Africa‘s third biggest economy jacked up interest rates in the second half of 2011 to fight soaring prices as inflation peaked at over 30 percent. It then launched a run of monthly growth-boosting rate cuts in June last year, which it paused for the first time this month with inflation at 5.5 percent.

Although inflation has been brought under control, economic expansion is comfortably below its potential growth rate of about 7 percent, the central bank has said.

“Reviving economic activity is therefore an urgent priority for Uganda’s low-income economy,” the IMF said in a statement late on Monday.

“To this end, the authorities’ short-term policies are appropriately geared at maintaining essential public investment and encouraging a gradual resumption of bank lending, while continuing to allow the shilling to reflect market conditions.”

The IMF forecast in November the Ugandan economy would grow 5 percent in the 2012/13 fiscal year from 3.4 percent in the previous period.

The Washington-based body also said the recent theft of donor funds by Ugandan officials, which led to some donors suspending aid, signalled the need for a more radical fight against graft.

Source: YAHOO NEWS.

Reuters

Egypt inflation up indicating rise in domestic demand.


CAIRO (Reuters) – Egypt’s urban consumer inflation rose to 6.7 percent in the 12 months to October 2012, Egypt’s state statistics agency reported on Sunday, reflecting a modest uptick in domestic demand.

Urban inflation, the most closely watched measure of prices, was 6.2 percent in the year to September.

The rise in prices of non-food items accelerated in October. Investment bank Beltone Financial noted the rise in inflation was in line with its forecast that inflation would climb till the end of the financial year in June 2013.

“The fact that non-food items have witnessed a pick-up in monthly and annual inflation in October 2012 suggests the beginning of a modest recovery in domestic demand,” it said.

Beltone said it expected inflation to climb because of “a relative recovery in domestic demand, an increase in inflationary expectations as a result of planned fiscal reforms, and an influx of foreign aid and improved domestic liquidity.”

Egypt is negotiating a $4.8 billion loan from the International Monetary Fund. It has already received some aid from Gulf Arab states to help shore up its finances after reserves plunged and the budget deficit ballooned in the wake of the uprising that toppled Hosni Mubarak in February 2011.

Food prices had dipped month-on-month in October, Beltone said, which it attributed to falling international prices for cereals and oils.

Beltone said it expected annual inflation to average 7.61 percent during 2012, down from 10.11 percent in 2011, and annual inflation to average 8 percent in the financial year 2012/13, down from 8.7 percent in 2011/12.

Source: YAHOO NEWS.

Reuters

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