The Federal Reserve pumped trillions of dollars through its secret liquidity lifelines into Wall Street’s financial sector during 2008-2010. The Fed also bailed out AIG’s derivative contract counterparties – to the tune of $85 billion. And the Fed sanitized GSE and big bank balance sheets by vacuuming up billions of dollars worth of distressed agency debt / mortgage backed securities (MBS) and parking it on the Fed’s balance sheet.
And here’s where we stand: 94.6 million working-age Americans no longer in the labor force. Anemic economic growth. And booming layoffs.
The Atlanta Fed’s GDPNow model …. projected that GDP grew by an anemic 0.7% in the fourth quarter of 2015. That was a drop from the model’s last prediction from December 23 that forecasted growth of 1.3%. The Atlanta Fed noted that the drop in the prediction came after disappointing net exports, construction spending, and ISM manufacturing numbers were released in the last week.
Peak Prosperity: Mass Layoffs To Return With A Vengeance
by Adam Taggart – Wednesday, February 3, 2016, 3:58 pm Excerpts:
Remember the mass layoffs of 2008-2009? The US economy shed millions of jobs quickly and relentlessly, as companies died and the rest fought for survival.
Then the Fed and the US government flooded the banks and the corporate sector with bailouts and handouts. With those giga-tons of liquidity sloshing around, as well as taking on massive amounts of new cheap debt, companies were able to finance their working capital needs, hire workers back, and even buy-back their shares en mass to make themselves look deceptively profitable. The nightmare of 2008 soon became a golden era of ‘recovery’.
Well, 2016 is showing us that that era is over. And as stock prices cease to rise, and in fact fall within many industries, layoffs are beginning to make a return as companies jettison costs in attempt to reduce losses.
Since January 1st, here is but a subset of the headlines we’ve seen:
- Johnson & Johnson to slash 3,000 jobs
- Wal-Mart pulls plug on smallest store format, shuts 269 stores
- GE plans to cut 6,500 jobs in Europe
- BP to slash thousands more jobs in face of oil downturn
- Macy’s to cut 3,000 jobs, close 36 stores
- Sprint cutting 2,500 and closing call centers to cut costs
- Canadian Pacific Railway plans to cut 1,000 positions
- Brazil economy shed 1.5 million payroll jobs in 2015
- Pearson to cut 4,000 jobs in latest restructuring
- Barclays to slash about 1,000 investment bank jobs worldwide
- Southwestern Energy to lay off 1,100 workers amid oil slump
- Major banks are making cuts: Bank of America, Citi Group and JPMorgan Chase are trimming jobs and branches.
- Autodesk to cut 10 pct of workforce
- Caterpillar closing 5 plants, cutting 670 jobs
- VMware posts higher-than-expected revenue, announces job cuts
- AIG to cut jobs in sweeping overhaul
- Monsanto to slash 1,000 more jobs, total planned cuts at 3,600
- Instacart layoffs may be a sign of things to come
- EMC plans layoffs as it cuts annual costs by $850M
Note that nearly all of these companies are in the Energy, Finance and Tech sectors — the three biggest engines of growth, profits and market value appreciation within the economy over the past 7 years.
What will the repercussions be if those three industries go into contraction mode at the same time?
Whatever the specifics may be, the general answer is easy to predict: Nothing good.
There is only one plan in America to revitalize the economy and restore economic liberty.
The Leviticus 25 Plan will pay off trillions of dollars in U.S. citizen debt obligations and recharge America’s citizen-directed economy.
The Leviticus 25 Plan 2017 – $75,000 per U.S. citizen The Leviticus 25 Plan 2017 (1324)