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An Economic Earthquake Shakes U.S. Municipalities

Bob Stokes — Mon, 20 May 2013 17:15:00

Municipalities have borrowed and spent for decades. A substantial number are going broke. The economic earthquake at the state and local level is part of an even larger seismic shift.

Deflation Warning: Money Manager Startles Global Conference

Bob Stokes — Fri, 17 May 2013 15:45:00

The economy has been sluggish for five years. There's no shortage of chatter about "why," yet few observers mention deflation. One exception is a hedge fund manager who spoke up at the recent Milken Institute Global Conference.

Higher Housing Prices: Prepare for the Flop to Follow the Flip

Bob Stokes — Fri, 10 May 2013 17:30:00

The National Association of Realtors reports that home prices are up 11.6% year over year. And that has a new surge of house flippers into the real estate market. If the housing market is poised for another dramatic downturn, almost no one sees it coming.

The Looming Financial Flameout: Phase II

Robert Folsom — Thu, 09 May 2013 16:15:00

This chart updates an earlier version published in the January 2007 issue of The Elliott Wave Financial Forecast. At that time, the chart was a warning for subscribers. An epic turn in the economy and financial markets began a few months later. That turn is clear to see on the updated chart taken from page 4 of the May 2013 Financial Forecast.

As with "Madame Deficit," Heads May Roll During the Next Economic Crisis

Bob Stokes — Mon, 06 May 2013 17:15:00

Marie Antoinette had been a spendthrift early in her reign, but curtailed that habit when she learned what the public thought. Even so, the young French queen had already been nicknamed "Madame Deficit." French debt had ballooned before she and King Louis XVI took the throne. But they received the blame for France's financial straits. Now fast forward to the U.S. economy today. Get ready for the blame game to turn serious.

America's Economic Engine Heads for an Overhaul

Bob Stokes — Fri, 26 Apr 2013 16:45:00

Nothing short of a complete overhaul will get the U.S. economic engine purring again. The financial mechanics have been trying to get that engine firing on all cylinders for five years now. They've used every tool at their disposal. Yet the engine continues to sputter. There appears to be only one fix.

An Epic Economic Trend Change is Underway

Bob Stokes — Mon, 15 Apr 2013 18:15:00

The earlier you spot a market trend, the more likely you can benefit from it. Is there an emerging economic trend in its early stages today? From the evidence, it appears so. Call it a seismic shift in the entire U.S. economy. Despite the evidence, most economic observers still do not expect what is about to swiftly unfold.

The Single Most Important Leading Economic Indicator

Bob Stokes — Thu, 11 Apr 2013 17:45:00

The phrase "leading economic indicators" refers to a core set of data points: the Consumer Price Index, real earnings, employment, U.S. Import and Export Price Indexes, Producer Price Index and so on. And Forbes recently listed several unusual economic indicators which include lip stick and wine auctions. Learn about the single most important economic indicator that trumps them all.

How to Protect Your Physical Safety in a Bad Economy

Bob Stokes — Tue, 09 Apr 2013 16:45:00

In a time of economic turmoil, what you know can be as important as what you have. Your possessions can decline in value or be lost altogether, but your knowledge cannot be taken away. You can use what you know to protect what you have. Evidence suggests that many Americans fail to grasp this basic truth. Staying ahead of the crowd begins by reading. As for what to read, few topics are as important as protecting your finances and your physical safety -- and that's what can matter most during a severe economic downturn.

The Housing Recovery Rests on an Unstable Foundation

Bob Stokes — Thu, 28 Mar 2013 17:30:00

The housing market has gone from financial rubble to what some analysts describe as another bubble. It's true that home prices are still nearly 30% below their mid-2000s peak. Yet the recent surge has Robert Shiller of the Case-Shiller Home Price Index concerned. Learn why.

Every Big Economic Collapse Has a First Domino

Bob Stokes — Tue, 26 Mar 2013 16:45:00

Financial history shows that every major credit boom is followed by a credit bust. The latest round of financial headlines remind us that unsustainable debt is crippling Europe. In the U.S., heavy debt burdens have put local and state governments in deep financial trouble. Federal debt rapidly approaches $17 trillion. What will be the first financial domino to fall?

Suburban Poverty Up Nearly 64%

Bob Stokes — Mon, 25 Mar 2013 16:45:00

New research shows that poverty has spread faster in the suburbs than the inner city. Many Americans still haven't recovered from the real estate bust. Unemployment and under-employment remain historically high. Robert Prechter writes, "The Fed is doing everything it can to try to keep the credit balloon inflated. But it’s failing, because the markets and the economy are certainly not zooming, despite all the QEs and 0% interest rates." In the new Elliott Wave Theorist, you'll find 11 charts. Six of them, accompanied by Prechter's unique commentary, show why Americans should brace themselves for a major change in the economy.

Use Your Imagination to Prosper During an Economic Downturn

Bob Stokes — Thu, 21 Mar 2013 17:30:00

You can prosper during an economic downturn by using your imagination. In the second edition of Conquer the Crash, Robert Prechter writes: "If you have a choice of employment, try to think about which job will best weather the coming financial and economic storm. ... If you are entrepreneurial, start thinking of ways to serve people in a depression so that you will prosper in it. ... Think about what people will need when times get hard."

Why Even Federally Insured Bank Deposits Are At Risk

Bob Stokes — Tue, 19 Mar 2013 16:45:00

Cyprus lawmakers voted against the European Union's proposed levy on personal bank accounts in Cyprus. Even so, bank runs in Cyprus may be unavoidable. Depositors in the U.S. can't help but wonder whether bank runs could happen here. It's true that the Federal Deposit Insurance Corporation guarantees U.S. bank accounts up to $250,000. Yet, during a time of severe bank stress, the FDIC's guarantee could actually make a bank crisis even worse. Learn why. Plus, find out how you can access a list of America's safest banks.

The Biggest Part of the Economy Could Be Headed for a Cool Down

Bob Stokes — Fri, 15 Mar 2013 16:15:00

If you notice fewer shoppers at the mall, fewer buyers on the car lot, fewer patrons at restaurants and fewer movie goers in coming days and months, don't be surprised. Why? The Thomson Reuters/University of Michigan preliminary sentiment index for March fell to its lowest level since December 2011. Learn what else the latest consumer sentiment data may suggest.

Why Your Life Insurance Company May Need Health Insurance

Bob Stokes — Wed, 13 Mar 2013 17:00:00

In the second edition of Conquer the Crash, Robert Prechter writes: "Even traditionally safe insurance companies are massively exposed to losses during a major deflation because they invest in standard vehicles such as stocks, bonds and real estate. ... When insurance companies implode, they file for bankruptcy, and you can be left out in the cold. I know, because my insurance broker placed our insurance with ..."

Labor Force Participation Rate Falls to 32-Year Low

Bob Stokes — Fri, 08 Mar 2013 18:30:00

The Labor Department's just-released 7.7% February jobless number just tells one side of the U.S. unemployment story. Another side seems to be downplayed: the decline in the labor force participation rate. There's yet another way of viewing America's jobs picture. Learn what that is, plus find out how you can prosper during the likely economic contraction ahead.

Investors in Student Loan Securities Take on Big Risk

Bob Stokes — Wed, 06 Mar 2013 17:30:00

Despite the growing percentage of students who are behind on their loan payments, investor demand for the securities derived from student loans also continues to grow. This grab for yield will likely end badly. The eventual bursting of the student loan bubble will contribute to the larger deflationary trend.

To Get a Job in This Economy, Go the Extra 10 Miles

Bob Stokes — Wed, 27 Feb 2013 16:00:00

The U.S. jobless rate is 7.8%. And the U.S. Bureau of Labor Statistics reports that the January 2013 unemployment rate of 18- and 19-year-old men is a whopping 23.7%. The candidates with the best chances of landing jobs in a tough economy are those determined to go the extra mile – or more. Are you prepared to survive and prosper if the economy and jobs market get worse?

Retirement Shock: Corporate Pension Plans Fall Short

Bob Stokes — Tue, 26 Feb 2013 17:15:00

Vast numbers of people may have to keep working past the age when they hoped to retire. That was the case even before the 2007-2009 financial crisis, and the economic environment since the crisis has produced even more delayed retirements. The evidence suggests that this trend will only grow worse. Perhaps you've read about the pension shortfalls that many municipal governments face. But that's only part of the story.