When it rains,it pours and the forecast doesn't look good.Let's look at a sampling of what's out there.
Tomorrow the unemployment number will be released,however,it's expected to remain flat.The annual January correction to overcome the BLS's flawed forecasting models will be in there and it will be an eye-opener.They always say it's easier to ask for forgiveness than to ask for permission.That seems to be the case with the BLS as they artificially keep the unemployment number low and correct it later after the politics have had a chance to run their course.
The CBO is virtually confirming that social security is broke.You won't see that in any official announcement,but if you review the numbers you'll find out that the tipping point so long warned about is here.They are now taking in less money than what is going out.They like to claim interest on the trust fund on the positive side,but since the trust fund is a paper tiger,it's not real.They don't really have access to that cash.This tipping point wasn't supposed to hit until 2019 and that was the forecast just last year.Obama didn't want to have to address this bailout so soon,but he'll not a choice.
The TARP fallout will kick into high gear as this year progresses.People are going to jail,and once that starts,let's see who squeals and tries to make a deal.The public smells a rat and once the spotlight really starts to shine on the dirty laundry of Goldman Sachs,Bank of America,Citi and all the rest,it could have a profound impact on the financial sector.You can make money right now on bank stocks,but watch closely as time goes on or you might take a bloodbath.
The states will be really the main players this year.Budget issues are bubbling over across the country and Uncle Sam simply can't save them all.I would look for emergencies to be declared all over.This will bring to a head the legal battles with the unions as the states will want to suspend collective bargaining in order to enforce pay cuts.They must declare the emergency to do this.We all know the political fallout this fall will be massive,however,I don't think alot of people have considered the trickle down effect these budget battles will have on them personally.Depending on your occupation or whether or not you receive assistance from your state,millions will be affected in various ways.
The Obama administration is butchering it's handling of so many areas,it's mind boggling.It looks like they will go entirely overboard on healthcare and get it thru regardless of the fallout.Cap and trade is not likely to rise back up anytime soon.Obama has shown he will take the end-around and work thru the EPA instead.National security will remain front and center because our enemies smell blood.He'll also likely take the plunge in some form to get immigration thru.I've always said he's a one termer,a sacrificial lamb to his ideology.He hopes to have a larger than life legacy as being the one who advanced the progressive movement across the finish line.More to come...