34 Million Receiving Food Stamps for the First Time

Food (Stamps): Reuters posted this piece on 8/6/09: “US food stamp list tops 34 million for first time”.  And here are some key points:

• “For the first time, more than 34 million Americans received food stamps, … a sign of the deepest and longest recession since the great depression.
• “Enrollment surged by 2 percent to reach 34.4 million people or one in nine Americans.”
• “It was the sixth month in a row that enrollment set a record. Every state recorded a gain in participation from April, Florida had the largest increase at 4.2 percent.”

The Economy – ‘Happy Talk’: On 8/7/09 LATOC (lifeaftertheoilcrash.net) sourced this gem by Mike  Whitney: “Skip the Happy Talk, This Depression is Just Starting”. Here at PrudentHome, we have consistently felt that much of the information Americans have been getting on the economy was skewed, spun, and downright fabricated; especially by the “Fed Gov”.

This article offers some insights into why our feelings might be justified. Here are a few of those insights:

• “Zero Hedge: Most interesting is the correlation between Money Market totals and the listed stock value since the March lows: a $2.7 trillion move in equities was accompanied by a less than $400 billion reduction in Money Market accounts.
• “Where, may we ask, did the balance of $2.3 trillion in purchasing power come from? Why, the Federal Reserve of course, which directly and indirectly subsidized U.S. banks (and foreign ones through liquidity swaps) for roughly that amount. Apparently these banks promptly went on a buying spree to raise the all important equity market, so that the U.S. consumer who(se) net equity was almost negative on March 31, could have some semblance of confidence back and would go ahead and max out his credit card. Alas, as one can see in the money multiplier and velocity of money metrics, U.S. consumers couldn’t care less about leveraging themselves any more.”
• “You read that right! Only $400 billion of that fantasy 6 month “green shoots” stock market rally cane from money market accounts. The  rest ($2.3 trillion) was laundered through the banks and other financial institutions to create the appearance of recovery and to raise equity for underwater banks rather than forcing them into receivership (which is where they belong). Bernanke probably knew that congress wouldn’t approve another TARP type bailout for dodgy mortgage-backed assets, so he settled on this shifty plan instead. The only problem is, the banks are still broke, business investment is at historic lows, consumers are on the ropes, the unemployment lines are swelling, the homeless shelters are bulging, the pawn shops are busting, tent cities are sprouting up everywhere, and according to MarketWatch, Corporate insiders have recently been selling their companies’ shares at a greater pace than at any time since top of the bull market of 2007.”
• “Face it; the economy is in the crapper and Bernanke’s trickery hasn’t done a lick of good.”

PH Note: Here’s what we see as a reasonable course of action given these times:

1. Save every penny.
2. Prepare for continuing hard times, and the possibility of harder times ahead, by continuing to develop your family food and essentials storage program.
3. Pay down your existing debt as rapidly as you‘re able taking into account #’s 1 and 2 first..
4. Garden, garden, garden.
5. Develop your essential skills such as: gardening, food preservation, medical treatment, home repair, sewing & personal protection from further social breakdown.
6. Maintain and improve your personal health and that of your family.
7. The last shall be first: Pray much!

Until next time; keep your eyes on the horizon as the weathers changing fast.