IMF Report on US Economy

IMF Report Link Here

This link takes you to the IMF website and opens a PDF report (July 2010) on the US economy as seen through the eyes of world bankers. Real estate, debt and labor are discussed at sufficient levels to understand the projections.

Below is the table of contents from that report. What they all do not say is that the reserve currency they all are holding, (the US dollar), and will increase in holding is worthless, but that discussion is for a different day. 

INTERNATIONAL MONETARY FUND
UNITED STATES
Selected Issues
Prepared by Nicoletta Batini, Oya Celasun, Thomas Dowling, Marcello Estevão,
Geoffrey Keim, Martin Sommer, and Evridiki Tsounta (all WHD)
Approved by Western Hemisphere Department
July 12, 2010
Contents Page
I. The Great Recession and Structural Unemployment ....................................................4
A. Introduction ...............................................................................................................4
B. Methodology .............................................................................................................5
C. Policy Implications ....................................................................................................7
II. Prospects for the U.S. Household Saving Rate ............................................................14
A. Introduction .............................................................................................................14
B. Experience of Nordic Economies ............................................................................14
C. Cross-Country Models of the Saving Rate ..............................................................15
D. What is the New Optimal Wealth Level? ...............................................................16
E. Conclusions .............................................................................................................16
III. Production and Jobs: Can We Have One Without the Other? .....................................22
A. Introduction .............................................................................................................22
B. How Does this Recession Compare to Previous Ones? ..........................................23
C. How Will the Recovery be Like? ............................................................................24
D. Conclusions and Policy Implications ......................................................................26
IV. The Financing of U.S. Federal Budget Deficits ...........................................................37
A. Introduction .............................................................................................................37
B. Post-Crisis Financing Patterns ................................................................................37
C. Baseline Projections of Demand for Treasury Debt ................................................38
D. A Model of Saving-Investment Flows ....................................................................39
E. Conclusions .............................................................................................................41
V. The U.S. Government’s Role in Reaching the American Dream ................................44
A. Introduction .............................................................................................................44
B. Impediments of the Current System ........................................................................45
C. Lessons from Other Countries.................................................................................46
D. Conclusions and Policy Implications ......................................................................48
2
VI. The U.S. Fiscal Gap: Who Will Pay and How? ...........................................................52
A. Introduction .............................................................................................................52
B. Methodology ...........................................................................................................52
C. Results .....................................................................................................................54
D. Conclusions .............................................................................................................56
A. What is the Fiscal Gap? ..........................................................................................63
B. What Are Generational Accounts? ..........................................................................63
Figures
I. l. Increase in Skill Mismatch Index Since Onset of Recession .........................................9
I.2. Labor and Housing Market Dispersion ........................................................................10
I.3. Change in Foreclosure Rates, 2005–2009 ...................................................................11
I.4. Estimated Equilibrium Unemployment Rate at End-2009 by State ............................12
II.1. U.S. Household Saving Rate Adjustment Could be Protracted ...................................19
III.1. Real GDP Growth and the Change in the Unemployment Rate, 1902–2009 ..............28
III.2. Long-Term Unemployment Across U.S. Postwar Recessions ....................................28
III.3. Rolling Okun’s Law Coefficients and Growth Compatible with Stable
Unemployment, 1915–2009 .............................................................................29
III.4. Comparing the Steep Recessions and Job-Rich Recoveries ........................................30
III.5. Comparing the Most Recent Recessions and Jobless Recoveries ...............................31
III.6. Comparing the Great Depression and the Great Recession .........................................32
III.7. Stock Market Volatility versus Rolling Okun’s Law Coefficients ..............................33
III.8. Impulse Responses from a Tri-Variate SVAR.............................................................34
III.9. Unemployment Scenarios ............................................................................................35
V.1. Housing Finance in the United States and Other OECD Countries .............................50
VI.1. U.S. Debt in Percent of GDP (1930–2083)..................................................................60
VI.2. U.S. Federal Fiscal Overall (solid) and Primary Deficit (dotted) in Percent of GDP
(1980–2083) .....................................................................................................60
VI.3. Total Revenues andTax Revenues in Percent of GDP—Advanced G-20 Countries ...61
Tables
I.1. Explaining Changes in State-Level Unemployment Rates ............................................8
II.1. Household Saving Rate: Baseline Regression Results ................................................18
III.1. Estimating Labor Demand and Okun’s Law for a Panel of Countries ........................27
IV.1. Projections of Baseline Demand for U.S. Treasury Securities and the Impact
of Excess Supply on Long-term Bond Yields..................................................42
V.1. United States and Canada: Housing Finance ...............................................................49
VI.1. Macroeconomic Assumptions Underlying Budget Projections ...................................57
VI.2 U.S. Fiscal Imbalance in Terms of the Present Discounted Value of GDP .................57
VI.3. Fiscal Imbalance in Terms of the Present Discounted Value of GDP, 3 Percent
Discount Rate ...................................................................................................58
VI.4. Lifetime Net Taxes as a Share of Present Value of Labor Income under Different
Scenarios, 3 Percent Discount Rate .................................................................58
3
VI.5. Impact on Fiscal Gap (as % of PVD of GDP) of Fiscal Adjustment by 2015 and
of Cap on Medicare ..........................................................................................58
VI.6. Additional Percent Increase in Taxes and/or Cut in Transfers Necessary to Close
the Fiscal Gap if Adjustment Starts in: ............................................................59 

Fiat Money 1 - The video that explains what money is, and how money works

Video Link

Click on the above to take you to one of the most important hour long videos about money you will ever watch. Every person in the USA should understand these basics. Most do not and most are being robbed of their wealth.

This video is well written. Take the time to watch it. Learn what is happening to you and you wealth.

America will have to "crash" in order to rebuild and reafirm

By Jim Rohr

This blog posting discusses a few of the glaring reasons why America will have to "crash" in order to bring about the changes needed in our society and our government...

For the record, I call the "new reform" a "rebuild" and not a "rewrite", as there is nothing substantially wrong with our Constitution or Bill of Rights. Sure, I would repeal the anchor baby clause. And for sure set term limits for politicians. Perhaps, I would even reverse the law that gives companies the right to make political contributions as this new contribution vehicle will increase the power of companies over politicians forever. I would also change our system of Supreme Court nomination, establish a standard for their office and set a term limit of say eight (8) years. This allows for correction if a mistake is made and sets the bar height very high for our highest court. One thing is clear to me is that if each of these are allowed to continue unchecked,  our liberty is in jeopardy. However, we are discussing true change, and why I think we need to crash before we can heal. Let's start with some examples.

It took a civil war to bring the end of slavery. It took World War II to end the expansionism of Japan and Nazi Germany.  It took Rosa Park, a black preacher named Martin Luther King and civil revolt to change the racial divide of the sixties. It's going to take a civil awakening to change the Government this time.

Change is tough. I should know. I have been in, associated with or led, "change management" initiatives since the early 80's. You know the kind I'm talking about....the type that "hurts"....not the "please would you do this different from now on" kind. No, I mean the "real hurt programs" where people either get on-board with change, or they are politely shown the door. 

Along the way, I have learned a key, but impossible axiom. Change would be easy if it wasn't for the people (stakeholders) involved.  Nice to say, but impossible to do. People will always be the key focus of any "quality" change management initiative because they are part of the system. It's never been more true here now in our society.  Let's investigate a bit more about "change" and add "culture" to the mix.

Business Culture: People brought together to create and run a business form a sort of business culture. People become "cultural" when they adopt common beliefs. Usually those beliefs are a shadow of the ideas and feelings of the top man...the CEO or the most powerful figure in the organization.  

U.S. National Culture: Unlike a business culture, a "National Culture" is the collection of ideas, truths and founding principals that make up a country's culture. Culture is also our collective memory of past successes and failures...our roots so to speak. It is also our laws, freedoms and liberties as citizens of this nation. Culture is also our founding belief that God has divinity over this country.

We are a melting pot of nationalities. In a way that in what makes this country called America so great. But it is also the diversity of our sub-cultures which makes this country vulnerable, dividable and potentially weak.  

Our "national culture" is under attack from forces inside and outside the Republic.  If these forces can divide us into our sub-cultures, then they can supplant our national heritage and inject a new dominion of power over the masses. It looks like these forces are trying just that with division rhetoric like race, religion, ethnic heritage and sex.   

Does anyone disagree that a "Standing Culture" must be overcome in any change initiative if you want to make massive change?  My experience suggests it's really hard to get someone to do something "largely new", when the base culture is used to doing things quite different.  This brings me totally on point to this blogs title.  I offer below a perspective of national change. 

• Before America can return to fiscal health and a much smaller Government ...we have to crash. I believe a financial collapse in the USA (...and perhaps most free world countries) is painfully eminent.  I also believe that this could be good, as it will allow the people to use this crisis:

1. As a means to reaffirm their faith that a), God is in charge and b), we live by His rules not ours. 
2. That greed, corruption and self interest have led us to this place in history. 
3. That our national culture does not include a massive Government trying to run every aspect of our lives. 
4. That we need a few basic things from our government and that's what it should have and pay for with our taxes...nothing more and nothing less. (In a future post I am going to lay out these things. Actually they are already written but the list is being reviewed).   

• We have to repel the forces that want to change this Republic to "a socialist model". People who are used to Government handouts, largely believe that America needs to provide for ALL their basic needs including food housing, health and child care, called "education". People who are willing to work hard, take risks and are self determinant, want nothing from the Government except to get out of the way. We will need to educate the former to show them that example after example, the socialist model has failed. That no amount of Government oversight will increase their freedom. 

• We need to repel the onslaught of Islam and stop denying our heritage as a "God based nation". http://informationinstitute.blogspot.com/2010/08/reprintmuslim-history-in-america.html

• For anti-American forces to succeed ...they will need to overcome our own American culture.  The easiest way to change a culture is not one heart and mind at a time...it's to change the culture "in mass." Case in point. Germany had to collapse financially (meaning their currency was worthless) before the Nazi party was able to get common German folks to accept the new radical Government model...and a new currency. The greater the crisis and strife we struggle to overcome each day, the easier it will be to accept change....any change...even a bad one, even socialism. 

This is not us. This current direction our leaders are going in is not our American destiny. The end goal of socialism is not our future.

Today, we will stand up and be counted.
Today, we will be patriots and speak out among ourselves.
Today, we will stand together.
Today, we will bring out the best in our Nation and send those who wish to destroy it back to where they come from.
Today, we will call it like it is...not how others what us to call it just so they can feel good about themselves.
Today, we will live in God's light of truth.
Today, we will walk the walk and talk the talk of National pride. American Pride. We will do so as a citizen of this great nation.

There are men and women before you who believed in these things and died for them so you can have a choice.

Will you be a true patriot, or will you be a sheep to be sheered?
Will you "fight the fight" for freedom?
Will you sacrifice for our country?
 Will you make a difference and vote?

JR

Secret US Government

http://video.google.com/videoplay?docid=3505348655137118430#

I know your time is valuable and so is mine, but this is a video you should watch. It shows the nature of the beast and uncovers the assault on our Constitution has been ongoing and relentless. 

Great Video on the New Republican

All Americans Have To See This Video on 9/11 Ground Zero

Link to jihadwatch.org

Reprint_Muslim History in America

Every American who has a father, mother, son or brother who fought for our freedom or enjoys this countries freedom payed for in blood should read this summary of Muslim Heritage in this country.  Now, I know God said to love our enemy, but he also said we could ask for his Divine hand to strike down oppressors of Israel and those who persecute Christians for their faith. He also said if we stop making Him part of our decision making process in this country, we would fall as a nation. People, we have a Muslim in the White House and he is hell bent on destroying this country from within. We are allowing him to do so one bill at a time and one dollar of useless debt at a time.  Congress is so broke that it does not have the backbone to stop it...No thanks to Democrats for standing up for what is right for America.... Throw them all out of both houses...all 545 of them.  Now on to this great piece of reflection. I am not sure who wrote this, but the words are incredibly strong and clarifying. What struck me in this op-ed letter is the note about the silence of the peaceful Muslims in the world while their brothers drive planes into America's  icons of prosperity.  Barack OBAMA, during his Cairo speech, said: "I know, too, that Islam has always been a part of America 's story."   AN AMERICAN CITIZEN'S RESPONSE:   Dear Mr. Obama:   Were those Muslims that were in America when the Pilgrims first landed? Funny, I thought they were Native American Indians.   Were those Muslims that celebrated the first Thanksgiving day? Sorry again, those were Pilgrims and Native American Indians.   Can you show me one Muslim signature on the United States Constitution?   Declaration of Independence ?   Bill of Rights?   Didn't think so. Did Muslims fight for this country's freedom from England ? No. Did Muslims fight during the Civil War to free the slaves in America ? No, they did not. In fact, Muslims to this day are still the largest traffickers in human slavery. Your own half brother, a devout Muslim, still advocates slavery himself, even though Muslims of Arabic descent refer to black Muslims as "pug nosed slaves." Says a lot of what the Muslim world really thinks of your family's "rich Islamic heritage," doesn't it Mr. Obama?   Where were Muslims during the Civil Rights era of this country? Not present. There are no pictures or media accounts of Muslims walking side by side with Martin Luther King, Jr. or helping to advance the cause of Civil Rights.   Where were Muslims during this country's Woman's Suffrage era? Again, not present. In fact, devout Muslims demand that women are subservient to men in the Islamic culture. So much so, that often they are beaten for not wearing the 'hajib' or for talking to a man who is not a direct family member or their husband. Yep, the Muslims are all for women's rights, aren't they?   Where were Muslims during World War II? They were aligned with Adolf Hitler. The Muslim grand mufti himself met with Adolf Hitler, reviewed the troops and accepted support from the Nazi's in killing Jews.   Finally, Mr. Obama, where were Muslims on Sept. 11th, 2001? If they weren't flying planes into the World Trade Center , the Pentagon or a field in Pennsylvania killing nearly 3,000 people on our own soil, they were rejoicing in the Middle East . No one can dispute the pictures shown from all parts of the Muslim world celebrating on CNN, Fox News, MSNBC and other cable news networks that day. Strangely, the very "moderate" Muslims who's asses you bent over backwards to kiss in Cairo , Egypt on June 4th were stone cold silent post 9-11. To many Americans, their silence has meant approval for the acts of that day. > And THAT, Mr. Obama, is the "rich heritage" Muslims have here in America ...   Oh, I'm sorry, I forgot to mention the Barbary Pirates. They were Muslim.   And now we can add November 5, 2009 - the slaughter of American soldiers at Fort Hood by a Muslim major who is a doctor and a psychiatrist who was supposed to be counseling soldiers returning from battle in Iraq and Afghanistan ...   That, Mr. Obama is the "Muslim heritage" in America ...   EVERY  AMERICAN MUST READ THIS !!