(The Economic Collapse Blog)—To those at the bottom of America’s economic pyramid, it feels like the economy has already collapsed. When you can’t afford to put a roof over your head and you barely have enough food to eat, nothing else really matters. During the Great Depression of the 1930s, millions of homeless Americans created large shantytowns known as “Hoovervilles” all over America. Unfortunately, we are witnessing the same thing today. Our homeless population is rapidly exploding, and those that have nowhere to live are creating shelters for themselves out of wood, cardboard boxes, tents, tarps, construction materials and whatever else they can find. In some cases, very large shantytown communities are being established, and they are primarily populated by our young adults…
During the Great Depression (1929 to 1933), 48 percent of the nation was homeless, living with relatives or in “shantytowns,” “Hoovervilles.” Today, between 47 and 52 percent of young adults are homeless, living with parents or shelters, a direct result of Biden’s radical overspending, energy and immigration policies, inflation, and high interest, turning America into a giant “Bidenville.”
One “Bidenville” that has been getting a lot of attention recently is located in Oakland, California.
A video of that “Bidenville” that was posted on social media on May 31st shows “massive temporary houses built along service roads”…
Shocking footage has emerged showing a gigantic ‘shantytown’ that has sprung up in Oakland, as the California city’s slide into crime-ravaged squalor continues.
Michael Oxford, the host of CaliBased, posted a video on May 31 of massive temporary houses built along service roads that open up into main roads in Hooverville, Oakland.
The footage showed trash strewn around scores of houses that were built of wood, tarp and other discarded materials.
I write about this stuff all the time, but it is still hard to believe that so many people are living in third world conditions in the United States of America in 2024.
Parts of Oakland are worse than a third world country.
They just allow people to live in absolute squalor, wherever they choose.
This looks like Hooverville during the great depression.
Welcome to Oakland’s very own Gavinville. pic.twitter.com/L58uK2E6Sh
— Michael Oxford – AKA The Santa Cruz Mountain Goat (@SCMountainGoat) June 1, 2024
The man that shot the video, Michael Oxford, used the term “absolute squalor” to describe the conditions that he witnessed…
Particularly shocking was just how large the ‘shantytown’ is, with a lengthy stretch of road in the Bay Area city covered with the makeshift dwellings.
Oxford could be heard calling the area a ‘shantytown’ that is ‘absolutely mindboggling,’ as he remarked how ‘insane it is that [city officials] allow this.’
He captioned the video, ‘Parts of Oakland are worse than a third world country. They just allow people to live in absolute squalor, wherever they choose.
If you live in “wealthy America”, you may never even drive into areas where people are living like this.
Your reality may be filled with tree-lined streets and rich people sipping coffee.
But in the worst areas of Oakland, the lawlessness never ends.
In fact, authorities in Oakland recently removed traffic lights at one major intersection and replaced them with stop signs because thieves were constantly stealing copper wire from the electrical boxes…
The city of Oakland recently removed traffic lights from one busy intersection and replaced them with stop signs after the electrical boxes that controlled the traffic lights were repeatedly tampered with and copper from them was stolen.
Local residents and those who own businesses in the area say the issue with the traffic lights stems from the nearby homeless encampment, which has grown over the years.
The owner of a vehicle repair shop on the corner of the intersection, Tam Le, said the city is signaling that it is ‘giving up on us,’ by installing the stop signs.
If you want someone to blame for this mess, you can blame the politicians in Washington.
Thanks to the horrific inflation that they have created, approximately a quarter of the population in California is either living in poverty or is very close to living in poverty…
Biden needn’t worry about losing California to Trump, but it has one of the nation’s highest rates of inflation, according to Moody’s Analytics, worsening its already outlandishly high costs of housing and other living expenses. It’s the biggest factor in California having the highest level of functional poverty of any state, 13.2% according to the U.S. Census Bureau, about 50% higher than the national rate.
The Public Policy Institute of California, using similar statistical methodology, has found that a quarter of Californians are either living in poverty or financially close. More recently, the PPIC has explored the impact of inflation, especially on California families which struggle to pay for housing, food and other necessities.
Sadly, this is just the beginning, because our economy is going downhill really fast. In May, pending home sales plunged to a depressingly low level…
Well, the analysts had the direction right but magnitude was way off as pending home sales plunged 7.7% MoM – the biggest drop since Feb 2021 (and below the lowest estimate), leaving sales down 0.7% YoY…
This is the 29th straight month of YoY declines for non-seasonally-adjusted pending home sales.
This MoM decline pushed the Pending Home Sales Index back to record lows…
Meanwhile, Zero Hedge reported that the Chicago PMI index fell so low in May that it suggested that “the economy is in a depression”…
After unexpectedly slumping last month to 37.9, the Chicago PMI index cratered even more unexpectedly in May, when it defied hopes of a rebound to 41.5, and instead tumbled even more, sliding to a cycle low of 35.4 which was not only below the lowest estimate, but was staggeringly low. To get a sense of just how low, the last two times it printed here was during the peak of the covid and global financial crises…
… which seems to suggest that at least according to Chicago-based purchasing managers, the economy is in a depression.
I would agree with that assessment.
Things are getting really bad out there.
To top everything off, in May the Dallas Fed Services Sector survey was in contraction territory for the 24th month in a row…
Despite Bernstein and Biden demanding the great unwashed realize just how great they have it in America, this morning’s Dallas Fed Services Sector survey offers some insights from actual real people in the actual real world trying to do actual real business… and it’s not pretty.
For two straight years (24 straight months), the Texas Services sector has been in contraction (below zero) with May’s -12.1 print worse than expected. For context, the Great Recession of 2008/2009 also saw 24 straight months of negative prints…
But if you live in “wealthy America”, you may not care about these numbers because you still live in a nice home and you still have plenty of nice things.
Unfortunately, the number of people that can afford to live in “wealthy America” is shrinking with each passing day.
And the gap between the wealthy and the rest of us just continues to get larger and larger.
Ultimately, the stage is being set for a societal meltdown of absolutely epic proportions.
The bottom 50 percent of the population only owns just 2.6 percent of all the wealth, and they are becoming very restless.
When people have nothing left to lose, they become very desperate, and very desperate people do very desperate things.
Michael’s new book entitled “Chaos” is available in paperback and for the Kindle on Amazon.com, and you can subscribe to his Substack newsletter at michaeltsnyder.substack.com.
Two Storms, One Harvest
Every food crisis in living memory has been a one-shock event. The 2008 price spike was a commodity bubble. The 2020 shortages were a logistics failure. The 2022 grain scare was a war on one exporter’s ports. Each time, the system bent, adjusted, and recovered, and each time the experts assured us afterward that global markets are simply too big and too diversified to fail.
What nobody in Washington seems eager to discuss is that 2026 is shaping up to be something the modern food system has never actually faced. Two independent shocks, one climatic and one geopolitical, are converging on the same harvest cycle at the same time. Not sequentially. Simultaneously.
Start with the weather. The Pacific Ocean is currently building toward what forecasters now openly call a record event. NOAA’s Climate Prediction Center puts the odds of at least a strong El Niño near 88 percent, with roughly two in three odds it reaches “very strong” status, the tier reserved for perhaps three or four events in the entire satellite era. Every major global model now projects a median peak in Super El Niño territory, and most of them project it exceeding the 2015-16 event, which until now held the modern record. Sea surface anomalies were already brushing the super threshold in mid-July, months before these events normally peak. The atmosphere has already shifted into El Niño mode, and the event is forecast to crest in late fall and early winter.
This is not about “climate change.” It’s about the standard cycles of weather, and the cycle we’re currently in is one that has likely devastated societies in the past. We’re better prepared as a society today, but not all Americans are equally prepared.
Serious households have started doing the quiet math on their own. Grocery bills tell part of the story, and the forecast maps tell the rest, which is why long-term food storage has moved from fringe hobby to mainstream line item in the family budget, with established suppliers like Heaven’s Harvest seeing demand from people who five years ago would have rolled their eyes at the idea. That instinct is not paranoia. It is pattern recognition, and the pattern is worth walking through carefully.
Editor’s Note: Heaven’s Harvest IS a sponsor, but the warnings of this article are real and would be written even if we didn’t have a survival food sponsor. With that said, those who take advantage of what they offer can use promo code “Patriot” for 15% off.
The Fertilizer Clock Is Already Running
While the Pacific warms, the second shock has been unfolding in the Strait of Hormuz. The conflict with Iran turned the world’s most important energy chokepoint into a contested waterway, and the consequences reach far beyond the gas pump. Roughly a third of global fertilizer trade moves through Hormuz, and the disruption sent urea prices up 86 percent year over year by March, with a 53 percent jump in a single month.
The World Bank projects energy prices rising about 24 percent in 2026 and fertilizer about 31 percent. By its own accounting, fertilizer prices ran 35 percent higher in the first five months of this year than the same period last year.
Here is the mechanism the nightly news will not explain. Fertilizer is not a grocery item. It is a time-delayed input. The nitrogen a farmer in Iowa or Punjab could not afford to apply this spring does not show up as a problem this spring. It shows up as a thinner harvest six to twelve months later.
The World Bank’s own food security brief concedes that the effects of reduced applications earlier this season “are likely to become visible only later in harvest outcomes.” Translate that from institutional language into plain English and it means this. The damage is already done, it is already in the ground, and we are simply waiting for it to arrive on the shelf.
Now check the calendar. Six to twelve months from the spring planting season lands us squarely in late 2026 and early 2027. Which is precisely when the strongest El Niño in the instrumental record is forecast to peak, bringing its signature droughts to Southeast Asia, Australia, southern Africa, northern Brazil, and South Asia, the very regions that grow the world’s rice, sugar, and oilseeds.
The World Bank warns openly that a strong El Niño “could disrupt multiple crop belts simultaneously” on top of the conflict-driven input costs. Their baseline projection assumes the Middle East disruptions ease by autumn. What in the last two years of Middle East history suggests that assumption is safe?
The System Has No Slack Left
The comfortable answer is that global markets always adjust. But adjustment requires slack, and the slack is gone. Global cereal production is expected to decline from last year’s records even before El Niño does its work. The UN World Food Programme, hardly a den of right-wing preppers, is calling this the most significant disruption to its supply chains since Covid and the invasion of Ukraine, and its supply chain director put the stakes bluntly.
Today’s supply chain challenges are tomorrow’s hunger crisis.
There is also a political dimension that markets cannot price. When food gets scarce, governments do not behave like economists. They behave like politicians. Export bans, hoarding mandates, and panic buying at the national level turned the modest rice shortfall of 2008 into a global crisis, and analysts are already warning that import-dependent nations are the first dominoes.
The 2015-16 Super El Niño, a far weaker event than what is now forecast, threw tens of millions into food stress across Africa and Asia. This one is projected to be stronger, and it arrives with fertilizer already rationed by price and shipping lanes already contested by missiles.
What Joseph Knew
Scripture does not treat preparation for lean years as faithlessness. It treats it as wisdom delivered in advance to those willing to act on it.
Behold, there come seven years of great plenty throughout all the land of Egypt: And there shall arise after them seven years of famine; and all the plenty shall be forgotten in the land of Egypt.
Joseph did not respond to that warning with a hashtag or a committee. He stored grain during the years of abundance, and when the famine came, Egypt stood while its neighbors begged. The lesson is not that famine is certain. It is that the time to prepare is precisely when preparation still looks optional.
Nobody who filled a pantry in a year of plenty has ever regretted it, and nobody standing in an empty aisle has ever been glad he waited for certainty.
None of this calls for panic, and panic is the enemy of sound judgment anyway. It calls for the same unglamorous prudence our grandparents considered ordinary. Keep some cash margin, know your local growers, and put real food in deep storage while it is cheap and available, because the entire arc of this story is that cheap and available is a closing window.
Families looking for a straightforward place to start can visit Heaven’s Harvest and use promo code Patriot for 15 percent off long-term storable food. The forecasts may yet soften, the strait may yet reopen, and we should pray they do. But hope is a fine thing to hold and a foolish thing to eat.
