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If you think this presidential election is routine …
Or if you believe this political season is a time for investing as usual …
You’d better wake up and smell the coffee!
Because a well-known — but rarely debated — financial monster is about emerge from the sidelines and explode into the forefront of the race for the White House.
Regardless of Who Wins, This Monster
Will Change the Course of History!
Why? Because it is so massive — and so MANY times larger than during prior presidential elections.
In the current election cycle, even after adjusting for inflation and measuring it in proportion to the nation’s GDP, this monster is …
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Nearly THREE times bigger than it was just four years ago when Barack Obama defeated John McCain.
Over SIX times worse than it was in 1996, when Bill Clinton defeated Bob Dole, and …
Almost TEN times larger than in 1964 when Lyndon Johnson beat Barry Goldwater.
What is the monster? If you haven’t guessed it by now, it’s THIS:
The most dangerous and destructive flood of fiscal red ink in the history of mankind — America’s gargantuan federal deficits.
But before you respond with a forehead-slapping “of course” (or a shoulder-shrugging “who cares?”), consider all the facts …
First, I repeat: It’s nearly TRIPLE the size of the already-large deficits during the last presidential election … and HUNDREDS of times larger than it was during earlier presidential elections in U.S. history.
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There’s no way a monster this big can be covered up or buried in a presidential election campaign. In fact, it’s already pervading virtually every debate.
Every time they talk about Medicare reform, they’re really talking about the deficit.
Every time they mention Social Security, personal tax returns or extended unemployment benefits, it all ties back to the deficit.
Second, it’s not just a one-year deficit. The deficit has been a record $1 trillion or more for THREE consecutive years, with no end in sight.
Third, the U.S. deficit monster is gigantic DESPITE some improvements in the economy since 2009. If the economy sinks back into deep recession, tax revenues will shrink and the deficit could DOUBLE in size.
And …
Fourth, for the first time in modern history …
Washington’s Debt Load Is
Crossing a Dangerous Threshold!
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Each year that Washington runs a deficit, it must borrow more money to finance the gap.
So with each year of red ink, the government’s pile of debts gets bigger and bigger.
Until now, the official tally of U.S. government debts was at least SMALLER than the size of the U.S. economy. Good.
But this year, U.S. government debt is growing LARGER than the entire U.S. economy.
This is a critical threshold for any country — and we are in the process of crossing it right now!
The sorry facts are very straightforward:
- The U.S. economy is expected to clock in at around $15.6 trillion in GDP. Meanwhile …
- The government’s debt load (excluding Medicare, Social Security, etc.) is going to be $16.3 trillion. That means …
Even if we gathered up all the income of every citizen, resident or company in the U.S for the ENTIRE year, and …
Even if we could use EVERY penny of that income to pay back the U.S. government’s creditors …
We would still be left with a pile of unpaid debts!
Washington will owe about $1.05 in debt for every dollar of products and services produced by every local government, company or individual in the USA!
These facts should be setting off major alarm bells around the world. They mean that:
- The United States of America is at an historic threshold, beyond which global investors are prone to panic and start dumping U.S. debts.
- The United States is passing the point of no return, beyond which any new government initiative to “end the crisis” will probably just make it worse.
Good fodder for presidential campaign managers?
They may think so. But it’s a political landmine because …
The Deficit and Debt
Monsters Are Nonpartisan!
They were created by both Democrats and Republicans.
They can wreak havoc on any presidential campaign or president, regardless of party affiliation.
And most important, ANY so-called solution — whether proposed by Democrats or Republicans — is likely to backfire.
Why? Consider the alternatives:
- If Washington lets government spending continue to grow, the deficit naturally gets bigger. But …
- Even if Washington cuts spending, it can’t solve the problem any time soon! Just as in Spain and Greece, the cuts merely help sink the economy, producing much larger deficits anyhow.
So as you can see, the deficit and debts are going to have a far bigger impact on politics and the economy than ever before.
Still skeptical? Then consider this: Because the deficits and debts have reached a crisis stage — and because of hard-coded laws that set yearend 2012 as the final deadline for government action …
The U.S. Now Sits on the
Brink of a Great Fiscal Cliff!
The International Monetary Fund, the U.S. Congressional Budget Office, the National Association of Manufacturers and many other authorities are now warning that one of the deadliest financial crises in U.S. history is set to strike the U.S. economy beginning this coming New Year’s Day.
The largest tax increase in U.S. history — plus the largest government spending cuts our nation has ever seen — are scheduled to take a staggering $1.6 TRILLION out of the U.S. economy!
JP Morgan says that, barring a miracle in Washington, America will fall “head first into the fiscal meat grinder.”
Federal Reserve Chairman Ben Bernanke agrees, warning that these unprecedented events will cause America to plunge off of the “fiscal cliff” on January 1, 2013.
And former Obama Treasury official Steven Rattner is warning of a “major market meltdown.”
According to these insiders, this new crisis will tear hundreds of billions of dollars out of the hands of U.S. consumers and companies …
Destroy thousands of businesses and vaporize millions more jobs in every sector of the economy, and …
Burst Wall Street’s stock market bubble, gutting the life savings of millions of Americans.
You see, although this historic deadline — January 1, 2013 — is still weeks away, it is already having a profound effect on the U.S. economy.
CNBC recently reported that corporate America is on hold — cutting hiring and expansion plans. And most are even refusing to provide any earnings guidance on conference calls — all due to the massive dangers this great fiscal cliff poses for them.
At the same time, millions of investors are frozen in fear, refusing to buy or sell anything until they get a clearer picture of how this unprecedented new crisis will impact the markets.
This is the definitive crisis of our generation. And I am determined to help you through it with your wealth intact and growing.
So stand by for our continuing updates.
Good luck and God bless!
Martin
Dr. Weiss founded Weiss Research in 1971 and has dedicated his entire career to helping millions of average investors find truly safe havens and investments. He is Chairman of the Weiss Group, which includes Weiss Research and Weiss Ratings, the nation’s leading independent rating agency accepting no fees from rated companies. His last three books have all been New York Times Bestsellers and his most recent title is The Ultimate Money Guide for Bubbles, Busts, Recession and Depression.
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Thankyou and all your staff for the info you provide.
Amen!
So what you are saying, is that Dr Ron Paul is not crazy? Could we take it one step further and state that his proposed plans to make enormous cuts in spending by eliminating inefficient and redundant (worthless) government departments and programs might even reverse the disaster (or at least mitigate negative impact)?
So when Paul supporters talk about fiat money, fractional reserve banking, quantitative easing, commodity backed currency, unsustainable global military intervention, global debt crisis and a potential currency bubble crash,, aren’t just making these things up because they are as loony as Dr Paul? So Romney and Obama aren’t really that different as our next “chosen one”? Doggone, I was counting on them to fix everything the day they are sworn in. ;)
“JP Morgan says that, barring a miracle in Washington, America will fall “head first into the fiscal meat grinder.†.. “Federal Reserve Chairman Ben Bernanke agrees, warning that these unprecedented events will cause America to plunge off of the “fiscal cliff†on January 1, 2013.”
Of course they are aware, as they are complicit in manipulating the economy and promoting global debt as a benefit to the economy, creating bubbles that grow and bust. My question is, if the global debt is larger than the global GDP, who holds the debt?
Good article though Martin. People need to wake up, as you said, and “smell the coffee”. I’ll give your new book a close read.
(I don’t think the USD is durable enough to make it to 1/1/2013 myself, but close enough).
You and virtually your entire crew have been raising this issue for a long time. Each and every time, we’re all going over the cliff. Bush’s tax cuts for the wealthy turned out to be null and void. His recession began Dec. 2007, losing millions of jobs before he left. Obama entered office in Jan. 2009 with unemployment at 7.5%. Obama wanted bipartisan deals with the Congressional House, but he was thwarted by the Tea Party miscreants each and every time. In the Senate, the largest number of filibusters in US history. On the day Obama took office, Republican saboteurs met and plotted to undermine Obama at every turn.
There is a huge problem in this country. A demographic shift is happening which is unstoppable. The Southern redneck states along with others have made it a referendum on a Black president because they fear the minority ethnic peoples taking over. This is what is happening. They can’t stand a Black man as president. The Southern confederacy wants to rise again. They denigrate virtually everything he’s tried to do. They enlist the wealthiest miscreants like Adelson and the Koch Bros. to turn America into a Fascist state. An oligarchy with corporatists ruling the roost. I say to you that this will fail, eventually. America is a violent nation, and when the little people keep getting screwed, they will revolt.
I’m fed up with the Wall St. thieves and crooks who’ve gambled with the American economic system, and they were bailed out by Main St. I’m fed up with the idea of profits at any cost like Romney used running Bain and borrowing to make millions costing jobs, pensions, and outsourcing of jobs. I’m fed up with the idea of privatizing pubic entities. All they do is scam the consumers.
I’ve read many of your letters, but you hardly ever mention anything about humanitarian issues. You’ve earned a grade level of D on this issue. I don’t ever want to get to the point of placing Wall St. on a pedestal, and behaving like Republicans using patriotism, freedom, and free market capitalism to expound on the virtues of the capitalistic system. It’s a flawed system that works, but unfortunately, the greatest economists have never been able to eliminate cycles, nor account for the greed and theft on Wall St.
“Patriotism is the last refuge of scoundrels.”
William Samuel Johnson
Obummer has done nothing but trash our Country since taking office. He is the worst since Carter and everything he ever did resulted in failure. Vote the turd out and send him packin back to Kenya where he belongs. Oh wait, they do not want him there either
i need to loose weight anyway so;
I’m going back to romain noodles and toast with butter.
Dr. Weiss
My father went through the last depression here in the U.S. I feel that this one will be much worse. Social Security and my company pension will for all intensive purposes disappear. My meager savings is my only hope. Your guidance in preserving wealth is very important to me and my family. We saw how quickly the market fell in 09. I lost 50% before I knew what to do. I am a little bit older and I hope a little wiser but I am still relying on your advice. Could you walk us through potential steps we might take at this time? I know that you cannot see the future exactly but will we sell our shorts and then what?? Will we reinvest in commodities or foreign ETF’s. Please ease the fears of many of your subscribers.
Thank you,
Dear Mr. Hamilton,
Are you really saying here what I’m reading? If you count yourself amongst Mr. Weiss’ subscribers, then certainly you have been out of stocks and lost out on a great rally.