Survey: Only 23 percent of U.S. companies plan to grow staff

Here's a sobering attitude check: the European debt crisis, coupled with fears that the U.S. economy is going to go off the so-called fiscal cliff in 2013, have put U.S. companies in a particularly grumpy mood.

Sixty-two percent of businesses don't plan on making any hires in the next six months—a significant uptick from the 48 percent who said the same thing back in April, according to the National Association for Business Economics. Only 23 percent of of those businesses polled in June said they planned to add staff in the second half of 2012.

In other words: the worsening we've been seeing with monthly unemployment numbers will continue. And the political fisticuffs between President Barack Obama and GOP challenger Mitt Romney will only get fiercer. Read more >>

Collapse of the U.S. Dollar Could Happen Any Moment

Greg Hunter’s USAWatchdog.com

There has been plenty of calamitous news surrounding the European debt crisis.  Greece is insolvent.  Spain just got a big bank bailout, and Ireland wants a new bailout deal.  No matter how bad it looks in the EU, Paul Craig Roberts says the problems in Europe are “nowhere near as big as the ones here.” 

The U.S. is printing massive amounts of money to paper over the mess, but it won’t work.  Roberts says a collapse of the U.S. dollar could happen at any moment.   It could be triggered by any number of things such as war or a derivatives meltdown.  When a former Assistant Treasury Secretary (under the Reagan Administration) and a PhD in economics sounds the alarm bell, people should take cover. 

Dr. Roberts says, “The cliff dive we are experiencing in housing isn’t over,” and precious metals prices are “being suppressed.”  Roberts says, “Gold prices should be rising.  Why? Because the debt is rising.”   What is the reason why Dr. Roberts thinks the suppression game has gotten so intense?  Dr.  Roberts says, “The fact that they are driving the price down suggests to me the situation is getting more desperate.”  Greg Hunter interviews Paul Craig Roberts one on one about these subjects and more.

Spanish Woes Continue To Deepen; Turmoil Spreads To Italy

Countries using the Euro de jure Countries and territories using the Euro de facto Countries in the EU not using the Euro (Photo credit: Wikipedia)

The euro-zone debt crisis deepened Tuesday as a sharp rise in Spanish government bond yields to their highest levels since the inception of the euro fanned speculation that the country might need a bailout of its own, just days after Spain sought a support package for its beleaguered banking system.
The market turmoil also spread to Italy, the euro-zone's third largest economy, where bond yields leapt higher ahead of a crucial bond sale later this week and weekend elections in Greece that could decide the country's fate in the common-currency region.

The deepening gloom surrounding Spain's credit-worthiness could have grave implications. A sovereign bailout for Spain will severely test the firepower of the euro area's rescue funds, hardly leaving any money in the pot if Italy were to be shut out of bond markets.

"It is quite likely that Spain needs a full bailout in the near future although policymakers will try all possible options to avoid this outcome, including a revival of bond purchases by the ECB as well as another three-year liquidity operation," said Pavan Wadhwa, global head of interest rate strategy at JPMorgan. "The concern is that the more peripheral debt the official sector holds, worries over subordination mean that the private sector will be less willing to lend to these countries," he said. Read more >>

Why Precious Metals Could Surge During A Deflationary Bank Run

The Future Tense
Things appear to be escalating in the Eurozone crisis, which has now turned into a full fledged bank crisis. While we have walked through the steps of the policy responses from political and monetary leaders numerous times, let's take a moment to walk through the process from the eyes of a citizen on the ground.

Imagine that you are an average citizen living in Greece. You have a family with two children and by now it is very likely that you have heard the news of a bank run. You are beginning to understand the ramifications of Greece moving back to the drachma currency after it leaves the Eurozone (an immediate and massive devaluation that would destroy 60-70% of your wealth).

€100 Billion In Secret Funds Props Up Greek Banks

There has been no official announcement. No terms or conditions have been disclosed. But Greece’s banking system is being propped up by an estimated €100 billion or so of emergency liquidity provided by the country’s central bank — approved secretly by the European Central Bank in Frankfurt. If Greece were to leave the eurozone, the immediate cause might be an ECB decision to pull the plug.

Extensive use of “emergency liquidity assistance” (ELA) to help banks in the weakest economies has been one of the less-noticed features of the eurozone crisis. Separate from normal supplies of liquidity and meant originally as a temporary facility for national authorities to use when banks hit problems, ELA proved a lifesaver for the financial system Ireland and is now even more so in Greece.

As such, it has given the ECB — which has ultimate control over the facility — considerable power to determine countries’ fates. Whether that power would ever be exercised is unclear. ELA is a subject on which the ECB is deeply reluctant to provide information — even on where or when it is provided. More...