Mark Hulbert, Editor of the Hulbert Financial Digest, warns that another Great Depression could happen soon.
According to Hulbert, the stock market parallels the behavior of the stock market before the 1929 crash. A chart comparing today’s market to the market of 1928-29 is making its rounds around Wall Street, and experts are frightened by what they see.
“…the market over the past two months has continued to more or less closely follow the 1928-29 pattern outlined in that two-months-ago chart. If this correlation continues, the market faces a particularly rough period later this month and in early March,” Hulbert wrote in his analysis of the stock market.
Although the markets’ correlation is uncanny, Tom McClellan of the McClellan Market Report, mentioned “…there is no guarantee that the market has to continue following through with every step of the 1929 pattern…” However, McClellan does believe there is reason for caution between now and May 2014.
With propane prices rising and temperatures falling, thousands of people in South Dakota are worried that they won’t be able to heat their homes.
“If you think about 57,000 households in South Dakota or about 70 percent of people in the state who use propane for heating, that’s a real impact on our state,” said Senator John Thune.
Senator Thune has been working hard for relief aid from the federal government, including sending a personal letter to President Obama.
Until federal aid arrives, the Red Cross has stepped in, providing residents in the Standing Rock Sioux Tribe with warm places to stay, hot meals, and extra supplies.
“…our concern was making sure they had a warm, safe place to be and that they had safe food to eat while they were waiting for the cold to break or to get propane resupplied at their homes,” said Dan Kuecker, the Disaster Program Manager for Western South Dakota for the American Red Cross.
In the midst of a bitter cold winter across the country, power operators are calling for voluntary conservation and the turning down of thermostats to protect natural gas levels.
In California, the issue is so severe that operators took the very unusual step of issuing a “Flex Alert” during the winter to ask people to conserve their uses of utilities. A “Flex Alert” is usually sent in the summer when the temperatures are so high that air conditioner use strains the electrical grid.
In the Midwest, the gas shortage is driving prices to levels 33% or more higher than normal for this time of year. One resident in St. Louis says they’re taking steps to keep their thermostats significantly lower after a delivery of 200 gallons of propane, which usually costs around $600, cost him $1,200.
Several U.S. Senators are demanding that federal consumer protection agencies look into the severe price fluctuations that are causing Americans to shut off their gas and heat out of fear of price spikes.
Due to the nationwide propane shortage, the National Propane Gas Association (NPGA) asked the federal energy regulator to order more supplies to create more propane. The additional orders will come from an Enterprise Product Partners Pipeline.
The Federal Energy Regulatory Commission (FERC) stated in a notice that the association asked Enterprise, one of the biggest suppliers of propane in the country, to supply 75,000 barrel per day (bpd) of propane along its TE Products pipeline running from the Gulf Coast to the Northeast. Service will start immediately until the end of the first week of March.
“NPGA submits that due to unique weather and other circumstances beyond control of shipers, propane supplies throughout the country, particularly the Midwest and Northeast, have reached dangerously low levels,” the FERC notice said.
Millions of Americans throughout the Northeast and Midwest have suffered from the shortage during this record breaking cold winter season.
Several state officials are investigating price gouging, trying to increase aid to low-income customers, and taking action against vendors due to propane shortages.
Midwestern and Southern residents are struggling to keep warm with the rising prices or supply cutoffs from propane distributors.
A major propane supplier in Kentucky was forced to stop delivering to commercial customers in several states after Kentucky’s attorney general was given an injunction against the company.
Missouri’s Justice Department and was asked by lawmakers to investigate rising propane prices. Missouri’s attorney general will be helping in the investigation as well.
A letter detailing concerns and actions of dealers was released by the Missouri Propane Association.
Colorado Senator Greg Brophy wants state officials to declare a state of emergency to assist families with skyrocketing propane prices.
Due to the many winter storms, many low-income families have maxed out their heating assistance benefits yet need more to continue staying warm throughout the winter.
Propane prices have risen by as much as 350% during this winter season across the United States. Residents of Colorado claim prices rose from approximately $2.50 a gallon to $5 a gallon and are expected to keep rising.
Michigan Governor Rick Snyder announced today that state administration is taking action to assist residents who have been affected by the ongoing propane shortage.
The Department of Human Services and legislature are working together to dedicate $7 million to the Low Income Heating and Energy Assistance Program in addition to another $7 million that was devoted to heating assistance from the Michigan Energy Assistance Program.
A loan program is also being initialized to help propane dealers and distributors who are struggling to meet demand by the Michigan Economic Development Corporation.
Additionally, the state is pushing for increased propane supply. More than 1.3 million gallons of propane have been delivered to the state this week.
The U.S. Department of Agriculture has reported that the country’s cattle herd has reached its lowest level in 63 years and that ongoing drought in Texas and the Midwest is going to further threaten herd levels.
More than 80 percent of the Lone Star state has been facing abnormally dry conditions that have impacted both farmer ability to water herds but also reduced much of the grass in the state to a level where it provides no nutrition for animals.
One farmer said he’s had major hits to his farm this year.
“We need rain bad,” rancher Stayton Weldon told Bloomberg. “We’ve got tremendous drought problems. It cuts your herd size down because people have to sell off to provide for the cattle that are left.”
Weldon has lost 22 cows and two bulls in the last year because of the conditions.
The USDA says the $85 billion a year beef industry will produce at its lowest level in 20 years through the end of 2014.
A report from a Wall Street analyst says that the government’s unemployment numbers are grossly underestimating the percentage of Americans who want work but can’t find it.
David John Marrotta said in a memo obtained by the Washington Examiner hat the true unemployment rate in the U.S. is 37.2%, almost five and a half times the 6.7% rate that has been touted by the Federal Reserve and Treasury Department.
“Unemployment in its truest definition, meaning the portion of people who do not have any job, is 37.2 percent. This number obviously includes some people who are not or never plan to seek employment. But it does describe how many people are not able to, do not want to or cannot find a way to work. Policies that remove the barriers to employment, thus decreasing this number, are obviously beneficial,” Marrotta wrote.
The major factor in the government’s number is that they remove anyone from the index who says they have stopped looking for work because they’ve been frustrated at their inability to find a job.
The memo also said that the Misery Index, which is calculated based on inflation and unemployment, is much higher than government reports. The official government statistics put the misery index at 7.54 while the true numbers have the number at close to 14.7, higher than during the Ford administration.
The United States has fallen from the top 10 of economically free countries according to the 2014 Index of Economic Freedom.
The Heritage Foundation and the Wall Street Journal released the results of the report that evaluated countries in 10 categories including fiscal soundness, property rights, government size and freedom from corruption.
The United States has peaked in 2006 when it was considered economically free but has fallen into the “mostly free” category of the report. The U.S. tumbled to 12th behind Denmark and Estonia. The drop was attributed to the Obama administration’s continuing shackling of large parts of the economy with regulations and the onerous health care law. Runaway government spending was also cited as a big reason for the decline of the U.S.
Hong Kong continued their run at #1 on the list followed by five other countries that are considered “economically free”: Singapore, Australia, Switzerland, New Zealand and Canada.
The bottom five in the rankings were Eritrea, Venezuela, Zimbabwe, Cuba and North Korea.
