The American economy is about to come to a grinding halt. You are totally fucked if you buy food, gas or anything. The U.S. economy is not just slowing down, but crashing, switching from strong positive growth to negative growth. This shit ain’t going to be pretty.

Obviously, housing prices are plummeting. Homes are sitting unsold and vacant in every neighborhood, as the grass turns brown and the plants die. Pools are turning into birth stations for mosquitoes. Many people are just walking away from their mortgages because their home is worth far less than what they owe. Thankfully, our government is bailing out the companies who made all the shady deals. It’s socialism for the rich! Yay!

You want to know how bad the housing market is....

Two for one houses! Oh, my God! We're fucking screwed!

Meanwhile, inflation is here and it’s a bit of an asshole. Prices on everyday products are going through the roof. Gas and milk are up to over $4 dollars a gallon. Just walking down the aisle at my local grocery story, I see product after product up around 25%. And the containers are smaller. It’s less food for more money. That’s how inflation works. But I can lose weight, so it’s pretty sweet!

The difference between this recession and past recessions is we are at a point where there is nothing left to squeeze. We’ve been experiencing inflation for years. No, not the economist bullshit technical term for inflation, but the kind you live through. Rising prices of non-traded goods, like insurance and health care, have been kicking the shit out of most Americans since the early '80s. And dollar-priced traded goods, like energy, for which we don’t have a substitute, have also been steadily rising for 10 years. Now we can expect cheap products, like the ones China sells to Wal-Mart, to shoot through the roof as the China yuan appreciates to avert domestic inflation. Suck it, America.

Now people are selling their gold jewelry, heirlooms and coins to get by.

Sounds fun. At the same time, there is a credit crunch. It is now harder to get loans and credit cards, because the banks fucked up and gave loans to a bunch of idiots who shouldn’t have gotten them. So, household access to credit is declining. People use credit to get through the hard times, but they are maxed out and the hard times aren’t even here yet. Seriously, they are not even here yet.

And people are losing their jobs as the economy slows. As it stands right now, the median U.S. household, if deprived of credit and income loss, has enough savings to last 18 days. That’s down from 30 days in 2001. We have been told to buy, buy, buy on credit for years. Now that incredibly moronic philosophy is coming to a quick and brutal end. That’s why people end up selling their gold watches and their children.

Where’s all that gold going? Shouldn’t the price drop if people are selling gold? Nope. The rich guys are snapping it up. Hedge funds, mutual funds, ETFs, investment banks and financial advisors, who have clients living the sweet life in the top 5% of net worth, are grabbing that gold. Since 2005, only the top 5% of American income earners have experience any real gain. It’s getting a little top heavy up in this bitch, like France 1790 top heavy. Get some scrap wood together and build a guillotine in that garage!

In the '70s, when we were in the same sort of economic situation, people lined up to buy gold and silver. They were converting their savings into gold and silver to protect it. But now, those people in the same income bracket are selling, because they don’t have savings, they have debt. So, they are buying dollars instead. At the same time, the Fed is printing money to fight the debt deflation unleashed by the housing bubble collapse, which causes the price of the dollar to drop and drop. It’s an epic disaster!

Debt deflation is a fucked up situation to live through. Here’s Dr. Steven Keen, an economist for the University of West Sydney who specializes in debt deflation, explaining what goes down.

Uh oh. That dude said 1930.

Hey, lookey! The stock market is tanking!

Yikes.

This is a train wreck. There has never been a period in the history of the world when the people carried the amount of debt we are carrying today. The lenders just finished lending out to the bottom of the barrel Americans: The sub-prime borrowers. Now it is biting them in the asshole. (Except, of course, the government is giving them tons of cash to make up for it.) And those borrowers were the end of the line. They were the people who did not deserve and never should have received loans. The problem is, they had to be doled out, because our economy is now a credit economy. We don’t make things anymore. We make our money from finance, investment and real estate. Or we did, anyway. That shit is coming to an end.

Gas is the tipping point. The United States was not constructed for high gas prices. As a country, we quite simply cannot function with such high prices. People who drive the greatest distances are those who can least afford the rise in price. The janitor who drives 50 miles to work in his SUV is completely fucked. He can’t sell the car, or afford the gas. Public transportation you say? There is not a city in this country that can handle the load of so many people making the switch to public transportation. There aren’t enough buses or trains. And if Bush bombs Iran, well, you can kiss the America you know goodbye. Think Mexico.

Even if situation does not get worse from here on out, this current mess will not work. When the vast majority of people are suffering and the rich are getting richer, the politics change. We are now there. Just take a look at the approval polls of Republicans. A shift is coming and it will change the way predatorial finance companies do business – but it will be ugly getting there.

People are beginning to understand that they are being lied to on a daily basis. You can’t tell us the economy is humming along; when we know it is not. And it hasn’t been for years. Every president since Reagan has changed the way economic information is collected and reported – Clinton was the worst of all. So, when the reality on the ground does not match what people are seeing, they stop believing you. There has always been a disconnect between politicians and the populace, but now that disconnect is just as large between the media and the people. That is where we are now and people are angry. America is a lit fuse.

Americans are fine when they are able to just scrape by. We took the years of working long hours or two jobs to afford that 100-mile a day commute to get to our overpriced house. America listened to the news, and the bogus economic statistics for years. Something didn’t seem right, but everyone went along. Now, with the housing disaster, insane gas prices, a plunging dollar and big time inflation, people are at their breaking point. It’s going to come very, very, soon.

We're going down.

Johnny can’t afford $1000 a month in gas. And he can’t afford the rise in food prices. And he’s got no savings. And he can’t afford health insurance. And he’s in massive debt. Who is Johnny going to get mad at? For every action there is a reaction. You can’t fuck over the poor the way this country has for 28 years without massive blowback. Time for the big boys to start watching their ass.

And that’s only the beginning. Periods of financial instability always lead to war. They always have. Wars begin because of debt. Oh, and some big country seems to be taking our oil….