So what is going to cause such a massive wave of bank failures that the FDIC will need hundreds of new employees just to deal with it?
Well, as we have reported previously, the financial powers in the U.S. are now moving to reduce the money supply, hoard cash and tighten credit. All of those things cause a slowdown in economic growth.
At the same time, a gigantic "second wave" of adjustable mortgages is scheduled to reset starting this year. This could push the U.S. economy into "part 2" of the housing crisis. Just check out the chart below....
Follow the title link.
Note, many blogs like these are selling something in this case (I think) gold. Nothing wrong with that. I don't think anybody has to cook the books too much to make the case for alternate investments.
I'm not selling anything, all I have are apocryphal examples:
Here in "Fun City" they are auctioning off a dozen condos this weekend. Original purchase prices were $800K, minimum bids on some of these are $95,000 for others there is no minimum. That doesn't mean that nothing is selling, a unit recently sold where I live, and not at a fire-sale price as far as anyone knows.
We deal with vendors for replacement windows, paint and concrete repair, air conditioning, other odds and ends. They all show signs of desperation. A paint job is being stretched out so that they can keep key employees active, doing something, but what was a team of six is now a team of four. Window contractor says they've laid off six, and he is delaying his retirement. He also verified something that I've read and that is that office rental space is getting funky. Lots of new vacancies, and no prospects for replacements, thus no build-out jobs for them.
After the recent blizzards our paint contractor used some of their heavy lift equipment (which is actually rented I think) to do snow removal in a far reaching arc. Apparently a lot of hurting companies swooped in to clear shopping center parking lots to earn some much needed extra money. Free enterprise at work, something the countries leadership doesn't understand. No doubt laws were broken, forms not filled out in triplicate and submitted at the appropriate offices.