Submitted by Tyler Durden on 07/26/2013
Submitted by Michael Snyder of The
Economic Collapse blog,
If our leaders could have recognized the signs ahead of time, do you think
that they could have prevented the financial crisis of 2008? That is a very
timely question, because so many of the warning signs that we saw just before
and during the last financial crisis are popping up again. Many of the
things that are happening right now in the stock market, the bond market, the
real estate market and in the overall economic data are eerily similar to what
we witnessed back in 2008 and 2009.
It is almost as if we are being forced to watch some kind of a perverse
replay of previous events, only this time our economy and our financial system
are much weaker than they were the last time around.
So will we be able to handle a financial crash as bad as we experienced back
in 2008? What if it is even
worse this time? Considering the fact that we have been through this kind
of thing before, you would think that our leaders would be feverishly trying to
keep it from happening again and the American people would be rapidly preparing
to weather the coming storm. Sadly, none of that is happening.
It is almost as if they cannot even see the disaster that is staring them
right in the face. But without a doubt, disaster is coming. The following are
18 similarities between the last financial crisis and today...
#1 According to the
Bank of America Merrill Lynch equity strategy team, their big institutional
clients are selling stock at a rate not seen "since 2008".
2008, stock prices had wildly diverged from where the economic fundamentals said
that they should be. Now it has happened
early 2008, the average price of a gallon of gasoline rose substantially. It is
starting to happen again. And remember, whenever the average
price of a gallon of gasoline in the U.S. has risen above $3.80 during the past
three years, a stock market decline has always followed.
home prices just experienced their largest two month drop since Lehman Brothers
During the last financial crisis, the mortgage delinquency rate rose
dramatically. It is starting to happen
Prior to the financial crisis of 2008, there was a spike in the number of
adjustable rate mortgages. It is happening
Just before the last financial crisis, unemployment claims started
skyrocketing. Well, initial claims for unemployment benefits are rising again. Once we hit the 400,000 level, we will
officially be in the danger zone.
Continuing claims for unemployment benefits just spiked to the highest level since early 2009.
yield on 10 year Treasuries is now up to 2.60 percent. We also saw the yield on 10 year U.S.
Treasuries rise significantly during the first half of 2008.
According to Zero Hedge, "whenever the annual change in core capex, also
known as Non-Defense Capital Goods excluding Aircraft shipments goes negative,
the US has traditionally entered a recession". Guess what? It is rapidly
heading toward negative territory again.
Average hourly compensation in the United States experienced its largest drop since 2009 during the first quarter of 2013.
In the month of June, spending at restaurants fell by the most that we have seen
since February 2008.
Just before the last financial crisis, corporate earnings were very
disappointing. Now it is happening again.
Margin debt spiked just before the dot.com bubble burst, it spiked just before
the financial crash of 2008, and now it is spiking
During 2008, the price of gold fell substantially. Now it is happening again.
Global business confidence is now the lowest that it has been since the last recession.
Back in 2008, the U.S. national debt was rapidly rising to unsustainable
levels. We are in much,
much worse shape today.
Prior to the last financial crisis, Federal Reserve Chairman Ben Bernanke assured
the American people that home prices would not decline and that there would
not be a recession. We all know what happened. Now he is once again promising
that everything is going to be just fine.
Are the American people going to fall for it again?
It doesn't take a genius to see how vulnerable the global economy is right
now. Much of Europe
is already experiencing an economic depression, debt levels in Asia are higher
than ever before, and the U.S. economy has been steadily declining for
most of the past decade. If you doubt that the U.S. economy has been
declining, please see my previous article entitled "40
Stats That Prove The U.S. Economy Has Already Been Collapsing Over The Past
And the truth is that most Americans already know that we are in deep
trouble. Today, 61 percent of all Americans believe that the country is on the
It isn't that so many people are choosing to be pessimistic. It is just that
an increasing number of Americans are waking up to the cold, hard reality that
we are facing.
Decades of incredibly foolish decisions have brought us to this
point. We allowed our economic infrastructure to be gutted, we
consumed far more wealth than we produced, our politicians kept doing incredibly
stupid things but we kept voting the same jokers back into office again and
again, and over the past 40 years we have blown up the
biggest debt bubble in all of human history.
We have been living so far above our means for so long that most of us
actually think that our current economic situation is "normal".
But no, there is nothing normal about what we are experiencing. We are
entering the terminal phase of a colossal debt spiral, and when it flames out
the economic devastation is going to be absolutely spectacular.
When the next major wave of the economic collapse comes and unemployment
soars well up into the double digits, millions of businesses close and millions
of American families lose their homes, I hope that those that are assuring all
of us that there will not be an economic collapse will come back and
There are tens of millions of people out there right now that are not
making any preparations at all because they have been promised that everything
is going to be okay. When the next financial crash happens, most of
them will be absolutely blindsided by it and many of them will totally give in
Don't let that happen to you.