The United States Crossed The Rubicon On Its Path To Collapse

- Julius Ceasar, after crossing the Rubicon River on his way to conquering Rome

I really wanted to go into a rant about how our economy and political system is in a serious state of collapse. The economic numbers released yesterday and this morning are proof that I'm right in my assessment of the economy. The Syrian situation is all the proof we need that our Government knows I'm right (the old attempted "divert the public's mind from the problems at home").

Quietly yesterday afternoon the Government released the August spending defiict. It surprisingly came in on the high side at $148 billion, well in excess of July's unexpectedly large deficit of $97.6 billion. And I'll note for the record that media was pretty quiet about reporting the number. YTD the total deficit with one month left in the fiscal year is $755 billion. To be sure it will a be bit less than last year and it will fall short of the trillion dollar mark, but keep in mind that embedded in this number is close to $100 billion of non-recurring payments from Fannie Mae, Freddie Mac and taxpayers (the December tax revenue jump from investment gains taken before the Jan 1 capital gains increase). In addition, revenues are higher this year, not because of a better economy, but because of a higher payroll tax rate. Finally, we know that Jack "I'm Robert Rubin's New Butt Boy" Lew, the new Treasury Secretary, has explicitly stated that he has played games with the budget in order to avoid running out of money now that the Government debt issuance has exceeded the so-called debt ceiling limit. The Government spending will experience a "snap-back" affect - at least from an accounting perspective - in the next FY from these "games."

Today retail sales for August were reported. They came in below expectations, and well below expectations if you strip out auto sales (which are inflated by easy credit) and inflation. You can read the details here: LINK and here: LINK. Essentially clothing sales and building materials (I told you the housing bounce is over) are dropping and restaurant sales - the beacon of disposable income - are plunging. In addition, consumer confidence was reported and it had its biggest miss vs. expectations on record and it has plunged back to its January level: LINK. In short, consumer spending is contracting (expect for student loan and auto debt recipients) - the economy is in trouble and the people on "main street" know it.

So much for my not ranting (but I kept it brief). The good news for gold investors is that since the Lehman crisis in 2008 it turns that gold and silver have been the number 1 and number 2 best performing investments: Gold and Silver #1 Since Lehman Collapse. I bet that surprises everyone who is reading this. Despite this nasty two-year correction, if you invested every penny in gold and silver, you have outperformed every other possible asset class. And get ready for the next move higher in gold and silver, because our system is in worse shape and further along its collapse than it was in 2008. Goldman Sachs knows this and that's why - despite their analyst report that says gold could still go lower here - Goldman Sachs - the firm - became one of the largest holders of GLD during the 2nd quarter of 2013. That just goes to show that anyone who follows the advice of the Taxpayer-supported big Wall Street banks is a complete idiot.

This brings me to the intended topic of my post today. I happened to catch the 1957 Frank Sinatra classic "Pal Joey" with Rita Hayworth and Kim Novak last night. I have to say, there's nothing like a cheeseball 50's musical to make you think back to what this country was like when it truly was an "exceptional" place to live and in which to be a proud citizen. I'm not going to elaborate beyond that because I want everyone to enjoy this number from the movie - but I will say that it really angered me that our country has devolved into a cesspool of unfettered corruption that's led by a gang of Democrats who are war-mongering, lying, cheating, stealing neocons and their figurehead is a useless Chicago-system politician who is better equipped to pimp hookers on Chicago's South Side - ENJOY: