WE NEED TO WATCH HOW THE SUPER RICH GET MUCH RICHER AFTER THE DEPRESSION OF 2020
This recession might be worse than 2009, IMF says
The global economy is on track for a short but sharp recession this year, according to a statement from the International Monetary Fund, as the impact from the coronavirus pandemic weighs on economies throughout the world.
The outlook for worldwide economic growth this year is negative, said Kristalina Georgieva, a managing director of IMF, in a statement Monday. The impending recession will be "at least as bad as during the global financial crisis or worse," she said.
The IMF expects that growth will rebound in 2021.
"The economic impact is and will be severe, but the faster the virus stops, the quicker and stronger the recovery will be," Georgieva said.
Pope Francis Expresses Concerns over Economic Fallout of Coronavirus Crisis
3:50
ROME — Pope Francis offered special prayers Monday for those who are unable to work and earn money during the coronavirus lockdown affecting Italy and beyond.
“Let us pray today for those persons who are beginning to experience economic problems due to the pandemic, because they cannot work. All of this affects the family,” the pope tweeted Monday.
The majority of Italians have been without work at least since March 9, when Prime Minister Giuseppe Conte declared all of the Italian republic a “red zone,” confining people to their homes except for proven need.
Even prior to the coronavirus outbreak, Italy was on the edge of a recession. Not only are most Italians no longer receiving an income, the government itself has seen its own tax revenues slashed as Italy’s number-one industry — tourism — has been suspended indefinitely and its massive manufacturing sector sits idle.
More and more Italians are asking how the nation expects to come out of its present state of lockdown without devastating economic repercussions for millions of citizens.
Some — even on the left — are beginning to question the legitimacy of “the greatest limitation of freedom in the history of the Republic” that was enacted without warning, debate, or parliamentary approval.
From the outset, the coronavirus has been marked by “institutional disorder,” writes Alessandro De Angelis, vice-director of the Italian version of the Huffington Post, with government haphazardly issuing directives drip by drip (like Chinese water torture).
The state reaction to the outbreak has resulted in no clear plan, he writes, but resembles “a distillate of collective anxiety.”
What has many Italians on edge is the “temporal indeterminacy” of the lockdown, De Angelis insists, as officials refuse to assign a date to any return to normalcy.
“The feeling is that a not indifferent political and social ‘experiment’ is being conducted in Italy, at least as a trend of the moment,” writes De Angelis, a self-described “leftist,” where democracy is exercised “as a regime of a leader called to manage the emergency, in a climate in which those who criticize the government are deemed traitors of the homeland in the face of the growing number of the dead, while propaganda by Big Brother is legitimate.”
Only when the crisis has passed will it be possible to evaluate the adequacy of the measures taken and the unprecedented “limitation of fundamental freedoms,” De Angelis laments.
The concerns voiced by Mr. De Angelis echo those expressed by a number of social commentators who suggest that the damage caused by a long-term lockdown could be worse than those of the virus itself.
“If this government-ordered shutdown continues for much more than another week or two, the human cost of job losses and bankruptcies will exceed what most Americans imagine,” the editors of the Wall Street Journal wrote last Thursday. “This won’t be popular to read in some quarters, but federal and state officials need to start adjusting their anti-virus strategy now to avoid an economic recession that will dwarf the harm from 2008-2009.”
The WSJ editors predict that a national shutdown could release “a tsunami of economic destruction that will cause tens of millions to lose their jobs as commerce and production simply cease. Many large companies can withstand a few weeks without revenue but that isn’t true of millions of small and mid-sized firms.”
“Perhaps we will be lucky, and the human and capitalist genius for innovation will produce a vaccine faster than expected—or at least treatments that reduce Covid-19 symptoms,” they observe. “But barring that, our leaders and our society will very soon need to shift their virus-fighting strategy to something that is sustainable.”
Trump Is Surrounded by Criminals
https://mexicanoccupation.blogspot.com/2019/11/the-fall-of-donald-trump-final-days.html
"The tax overhaul would mean an unprecedented windfall for the
super-rich, on top
of the fact that virtually all income gains during the period of
the supposed
recovery from the financial crash of 2008 have gone to the top 1
percent income
bracket."
BECAUSE BILLIONAIRES AND BANKSTERS
ARE ALL
DEMOCRAT BRIBESTERS!
A $50 Billion Airline Bailout for Warren Buffett
Daniel Greenfield, a Shillman Journalism Fellow at the Freedom
Center, is an investigative journalist and writer focusing on the radical Left
and Islamic terrorism.
CCP Virus Exploding Federal
Deficit Even as Comptroller General Warns of ‘Urgent’ Need for Debt Reduction
Trump Is Surrounded by Criminals
https://mexicanoccupation.blogspot.com/2019/11/the-fall-of-donald-trump-final-days.html
“The legal ring
surrounding him is collectively producing a historic indictment of his endemic
corruption and criminality.” JONATHAN CHAIT
TRUMPERNOMICS FOR THE
RICH…. and his parasitic family!
Report:
Trump Says He Doesn't Care About the National Debt Because the Crisis Will Hit
After He's Gone
"Trump's
alleged comment is maddening and disheartening,
but at least he's being straightforward about his indefensible
and self-serving neglect. I'll leave you with this reminder of the scope of the problem, not that anyone in power is going to do a damn thing about it."
but at least he's being straightforward about his indefensible
and self-serving neglect. I'll leave you with this reminder of the scope of the problem, not that anyone in power is going to do a damn thing about it."
TRUMPERNOMICS:
THE SUPER RICH APPLAUD
TWITTER’S TRUMP’S TAX CUTS FOR THE SUPER RICH!
"The tax overhaul would mean an unprecedented windfall for the
super-rich, on top
of the fact that virtually all income gains during the period of
the supposed
recovery from the financial crash of 2008 have gone to the top 1
percent income
bracket."
Why do Republicans want to bail out a
top Democrat funder?
BECAUSE BILLIONAIRES AND BANKSTERS
ARE ALL
DEMOCRAT BRIBESTERS!
A $50 Billion Airline Bailout for Warren Buffett
Why do Republicans want to bail out a top Democrat funder?
March 23, 2020
Daniel
Greenfield
In March, as the Wuhan Flu was
taking off in America, the Oracle of Omaha began buying airline stocks.
Specifically, one of the wealthiest men in the country increased his stake in
Delta Airlines to 11%.
Warren Buffett wasn’t oblivious
to the coronavirus. The University of Nebraska Medical Center, not far from the
black gated mansion of the billionaire, was on the front lines of fighting the
outbreak. Passengers from the Diamond Princess cruise ship were being treated 5
minutes from his house.
What was Warren Buffett
thinking when he shoved $45 million more in good money after bad?
Berkshire Hathaway now owns 11%
of Delta Airlines, and between 8% and 10% of United Airlines, Southwest
Airlines, and American Airlines. When you’re squeezed into a 17-inch airline
seat, it’s because a major funder of Democrat political causes is extracting
maximum value from his investment.
And now Airlines for America,
whose major members include American, Delta, United, and Southwest, along with
lesser airlines, want a $50 billion bailout. That includes $25 billion in
grants and $25 billion in loans and tax relief. While the airlines warn about
an economic catastrophe, Buffett isn’t worried.
Warren Buffett is no stranger
to bailouts. In 2010, he penned a fake folksy New York Times op-ed thanking “Uncle
Sam” from his nephew “Warren”. Later that year, he became a key propaganda
figure in Obama’s push to raise taxes. By the winter of the year, Obama had
placed the Presidential Medal of Freedom around the neck of the man who had
fundraised for him and acted as his financial adviser.
As Peter Schweitzer noted, “It was only on September 23 that he became a highly visible
player in the drama, investing $5 billion in Goldman Sachs, which was
overleveraged and short on cash… Berkshire Hathaway received preferred stock
with a 10 percent dividend yield and an attractive option to buy another $5
billion in stock at $115 a share… As he admitted on CNBC at the time, ‘If I
didn't think the government was going to act, I wouldn't be doing anything this
week.’”
Buffett seems to think that the
government will act and bail out the airlines. Again. And this time for a lot more than the $15 billion price tag of the airline bailout that
passed after September 11.
By 2009, Berkshire Hathaway had invested $26 billion in eight financial companies, including Goldman
Sachs, Wells Fargo, and Bank of America, which benefited from around $100
billion in TARP money.
There’s no question that the
Democrat billionaire is a very sharp investor. But there’s no reason for
taxpayers to keep subsidizing his investments. As small businesses are forced
to shut down and millions of people are put out of work, should they really be
helping Warren Buffett get even richer?
Just as during the bailout,
Buffett is betting that the government is going to back his investment.
If the major airlines were
really about to go down, Buffett would be trying to get everything out, instead
of getting in deeper. The billionaire is betting that Berkshire Hathaway will
emerge in a stronger position after the bailouts and the surge of optimism that
will follow the lifting of the coronavirus curfews.
He’s almost certainly right.
But if he wants to profit from
the turnaround and the potential takeover of an airline, he should do the heavy
lifting on his own. Berkshire Hathaway is sitting on $125 billion in cash. But why cash out his treasury bills
when the D.C. swamp will be happy enough to do most of the heavy lifting for
him.
Where will those
taxpayer-funded profits go?
In 2014, the Oracle of Omaha
predicted that Hillary Clinton will win. “I will bet money on it, and I don’t
do that easily,” he boasted.
Republicans lobbying for an
airline bailout are literally fighting to secure taxpayer money that will then
be used to fund their political opponents. It’s an insane act of fiscal
political suicide.
Beyond political donations,
Buffett has spent millions covertly funding abortion activism. Due to his
obsessive secrecy, the full scope of his abortion funding is unknown, but the
Buffett Foundation donated almost $4 billion to abortion causes,
including $674.5 million to Planned Parenthood.
It’s a revelation that clashes
with his folksy image and invocation of small-town values. But behind the
Garrison Keillor routine, Buffett is just another version of George Soros with
an American accent.
That’s not just rhetoric.
At the heart of Soros' power
over American politics is the Democracy Alliance, a club of powerful
organizations funneling money into transforming this country. The Democracy
Alliance's core partners include the NoVo
Foundation, run by Buffett’s son and
daughter-in-law, and funded by $150 million from the Oracle of Omaha.
NoVo funds hate groups like Van
Jones' Color of Change, which plotted to defund the David Horowitz Freedom
Center, along with the Rockefeller Family Fund, the Tides Foundation, and the
National People’s Action.
That last donation is especially interesting considering NPA’s role in creating the Community
Reinvestment Act which forced banks to dispense mortgages to insolvent
borrowers. This, as the Freedom Center’s Discover the Networks notes, “ranks
high among the primary causes of the 2008 financial crisis.” That’s both
fascinating and disturbing considering Buffett’s links to that crisis.
Buffett avoided the subprime
crisis while profiting massively from the resulting disaster.
Putting money in Buffett’s
pocket will mean more cash for Biden, it will mean more Democrats in the House
and the Senate, more abortions, and more power for George Soros’ Democracy
Alliance.
So why are Republicans ready to
make concessions to Democrats in exchange for the privilege of electing more
Democrats with a Buffett bailout? Even if one were to argue that a bailout of
the airline industry may be necessary, why would Republicans lobby to cut their
own throats?
When the wall isn’t funded, how
can the GOP justify a second billion-dollar bailout of an industry that will
then just turn around and cut another 2 inches from the cramped seats of the
taxpayers who bailed them out?
CCP Virus Exploding Federal
Deficit Even as Comptroller General Warns of ‘Urgent’ Need for Debt Reduction
March 20, 2020 Updated: March 22, 2020
WASHINGTON—There were only rumors of a
possible $1 trillion economic stimulus package on March 12 when U.S.
Comptroller General Gene Dodaro urgently warned the Senate Budget Committee
that federal spending and debt are on an “unsustainable” path.
“I am concerned because our debt-to-gross
domestic product (GDP) ratio as of the end of the last fiscal year was 79
percent. That’s the highest it’s been since World War II, when we hit the
historic high of 106 percent,” Dodaro said.
“So we are very heavily leveraged in debt
at a time when we are going to be facing a steady annual deficit of a trillion
dollars a year for as far as the eye can see.”
He was referring to the fact the national
debt now exceeds $23 trillion ($122 trillion if unfunded obligations such as
those of Social Security and Medicare are included).
That $23 trillion currently equals 109
percent of the 2019 GDP of $21.4 trillion. But interest costs more each year as
the national debt goes up and the Government Accountability Office
projects those costs to exceed total non-defense discretionary federal spending
by 2024, go beyond defense spending the next year, and blow past Medicare in
2042 and Social Security in 2046.
“This is why we believe the current path is
unsustainable,” Dodaro said.
Five days later, amid an intensifying
worldwide crisis occasioned by the CCP
virus, Treasury
Secretary Steven Mnuchin confirmed that President Donald Trump wants
Congress to pass an economic stimulus package that will cost at least $1
trillion.
“It is a big number. This is a very unique
situation in this economy,” said Treasury Secretary Steven Mnuchin. “We put a
proposal on the table that would inject $1 trillion into the economy. That is
on top of the $300 billion from the IRS deferrals.
“Now let me just say, this is a combination
of loans, this a combination of direct checks to individuals, this is a
combination of creating liquidity for small businesses.
“You can think of this as business
interruption money. The president is determined to put money back into this
economy to protect hard-working Americans and small businesses.”
About half of the funds will go to
individuals and families based on reported income from 2018, with most of the
other half being loans made available to corporations and small businesses
primarily for the purpose of keeping payrolls as intact as possible during the
crisis.
Details are still being worked out in
negotiations between the Trump White House and congressional leaders from both
parties.
Asked by a reporter if Congress should be
concerned about rising deficits, Mnuchin demurred, saying: “I think Congress
right now should be concerned about American workers and small businesses. You
know interest rates are incredibly low right now, so there’s very little cost
of borrowing this money, and, as I’ve said, in different times, we’ll fix the
deficit, but this is not the time to worry about it.”
Even so, the $1 trillion stimulus package
raised eyebrows, especially as more details became known. The budget committee
has asked the Congressional Budget Office (CBO) for an assessment of the
package’s impact on the government’s financial health, according to a senior
Senate aide who asked not to be identified.
The conservative Heritage Foundation
released an analysis warning that “any action that
Congress takes should be targeted, temporary, and linked directly to the
coronavirus epidemic in order to address the source of the economic shock,
while limiting any political abuse that can develop in a moment of crisis.”
“Unfortunately, the Senate’s coronavirus
bill, the Coronavirus Aid, Relief, and Economic Security Act, misses this mark
by including special benefits to specific industries that will exceed $200
billion,” it said.
Truth
in Accounting President
Sheila Weinberg told The Epoch Times that it appears “the federal government is
going to cover trillions of dollars of other losses and costs, including
those for business interruption, personal income loss, and health care costs.”
“This type of coverage is what insurance
companies do, but not at this scale,” Weinberg said.
“The federal government requires insurance
companies to have reserves to meet their customers’ benefits. Since the federal
government has become a multitrillion-dollar insurance company, it should have
reserves to cover the costs of crisis. Instead, the government is $23 trillion
in debt (plus another $100 trillion for unfunded Social Security and Medicare
benefits).”
The Epoch Times refers to the novel
coronavirus, which causes the disease COVID-19, as the CCP virus because the
Chinese Communist Party’s coverup and mismanagement allowed the virus to spread
throughout China and create a global pandemic.
Contact Mark Tapscott at
Mark.Tapscott@epochtimes.nyc
Global economic slump accelerating
As the coronavirus spreads, taking more lives at an escalating rate, its effects are penetrating ever deeper into the global economy.
Goldman Sachs warned last week that US gross domestic product (GDP) would contract by 24 percent in the second quarter. There are forecasts that up to 5 million jobs will be lost in the American economy this year, with the fall in economic output to total as much as $1.5 trillion.
Goldman expects, at this stage, that US output will contract 3.1 percent this year and the unemployment rate will rise to 9 percent from the current level of 3.5 percent. This is on a par with the jobless rate of 10 percent in October 2009, following the financial meltdown of 2008.
But just as the health impact of the virus was significantly underestimated, the same may apply to the current economic forecasts.
“Things look so gloomy right now that perhaps we should be grateful if we can get out of this health crisis with a brief recession,” Bernard Baumohl of the Economic Outlook Group told the Wall Street Journal.
“You just cannot rule out the prospect of a longer, more destructive depression,” he said.
In other words, a relatively short but deep recession is now the “best case” scenario.
The eurozone is expected to experience a fall of around 10 percent of GDP. But this forecast could well be exceeded. There is no end in sight to the spread of the virus and no clear assessment of the economic effect of the shutdowns being implemented to try to combat it.
In an interview with the Financial Times, the chief economist of the European Union, Paolo Gentiloni, indicated that officials were working on new measures.
“The consensus is growing day by day that we need to face an extraordinary crisis with extraordinary tools,” he said.
“This idea of a V-shape [recovery] that you can see in the first semester of 2020 is now completely impossible. We have no previous analysis of the impact of such a widespread lockdown in major economies.”
Gentolini conducted the interview as part of a political battle inside the EU over the economic and financial measures, bringing further into the open the widening rifts between leading member states.
Powerful forces in Germany and the Netherlands are opposed to all-European action, regarding this as a bailout for weaker economies such as Italy.
On the other side, the French Finance Minister Bruno Le Maire last week warned that failure to act in a unified manner meant the eurozone was in danger of disappearing.
European Financial Times columnist Wolfgang Münchau wrote yesterday that the situation facing the eurozone was “far worse” than the sovereign debt crisis of 2012.
“The coronavirus will prove to be an economic shock, a corporate solvency crisis and a political crisis all folded into one,” he said.
Münchau noted that European countries had fiscal stabilisers such as unemployment insurance, but these “shock absorbers” were designed to deal with “normal fluctuations.” They were not “big enough or strong enough for emergencies like this one.”
Pointing to the deepening divisions in Europe, Münchau wrote that not everyone would want to be in a monetary union with countries like the Netherlands where the prime minister was “ideologically opposed” to all-European measures. “This sort of unwilling partnership is not sustainable.”
In the absence of data on overall output, the Financial Times conducted a survey, particularly covering retail and services, to give some indication of what to expect.
It showed that vehicular traffic had halved in many of the world’s largest cities, while spending in restaurants and cinemas had collapsed.
Greg Daco, the chief US economist at Oxford Economics, said: “Looking at the data across various sectors of the US economy, it appears we could be heading for the most severe contraction in consumer spending on record.”
The rapid shrinkage in the real economy will further escalate the already severe crisis in the financial system, and extend from the stock and credit markets to the banks.
In a Financial Times comment, Sheila Bair, the former chief of the US Federal Deposit Insurance Corporation, wrote: “Big banks throughout the world are substantially exposed to the pandemic, particularly as it hurts corporate borrowers.”
Around the world, non-financial corporations covering every industry, including the hard-hit energy, transport, retail and hospitality sectors, had racked up debts to the tune of $70 trillion, she wrote.
“To survive, they are increasingly hoarding cash and tapping into their massive back-up lines of credit, placing additional strain on the banking system,” Bair wrote, noting that as bond markets “seize up,” bank credit may be their only source of cash.
But the ability to supply credit, she wrote, had been considerably weakened by the $325 billion paid out by the major global banks last year on dividends and share buybacks, some $155 billion of which was laid out by the eight largest banks in the US.
Meanwhile, fears are growing that the enormous pile of debt around the world could start to collapse as the economic effects of the coronavirus deepen and widen.
According to the Institute of International Finance, in a report published last November, total global corporate, government, finance sector and household debt had reached $253 trillion, equivalent to 322 percent of global GDP.
The unravelling could start in so-called emerging market economies where there is $72.5 trillion of debt, much of it denominated in US dollars. The growing dollar shortage in international markets, which has seen national currencies fall against the greenback, means obligations on interest and principal payments are rapidly rising.
This increase in the debt burden is occurring as all economies drop into recession, or something worse, and have less cash to meet their commitments.
It is not just emerging market economies that are affected. The Australian dollar, one of the most traded in the world, saw its rate against the US dollar drop to as low as 55 cents last week, compared to just under 70 cents a few months ago.
This means that the debt burden of a company or financial institution that had raised $100 million, when the Australian dollar traded at 70 cents to the US currency, would rise in Australian dollar terms from $A143 million to more than $A180 million when the Australian dollar fell to 55 cents, placing it under enormous strain as revenues drop.
The cash flow crisis is striking at the heart of the major economies as well.
In the UK, the Tory government is considering a plan to take out equity holdings in airlines and other companies because the economic stimulus packages announced so far are not sufficient to prevent collapses.
In the US, the Wall Street Journal has reported that “scores of US companies,” from the aircraft maker Boeing to the telecommunications Verizon, are “furiously lobbying” to be included in the bailout packages being prepared by the Trump administration that could run as high as $2 trillion.
For more than a century, the semi-official religion in the US has been the denunciation of socialism, which Trump had planned to make the centre of his re-election campaign.
Now the universal cry is: the state must intervene; once again billions must be handed to the corporations on an even larger scale than in the crisis of 2008.
The calls will only get louder. According to a Wall Street Journal report yesterday, investors and analysts say the more than 30 percent drop in the share market over the past month is not over, despite extraordinary actions by the Fed involving trillions of dollars.
Summing up the voracious outlook in corporate and financial circles, a representative of the global investment and banking firm State Street, told the Journal: “Market participants need to feel they are backstopped without question.”
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