Banks continue to fail at an alarming rate. Eighty-four have failed so far this year with experts predicting anywhere from 100-300 or even as many as 1000.

The U.S. national debt will nearly double over the next 10 years, government forecasts showed on Tuesday, challenging President Barack Obama's economic and healthcare overhaul agenda.

The spending blitz could push the national debt, now more than $11 trillion, to close to $20 trillion. The debt is the total sum the government owes, while the deficit is the yearly gap between revenues and spending.

"If anyone had any doubts that this burden on future generations is unsustainable, they're gone," said Senate Republican leader Mitch McConnell, adding that economic stimulus funds should be diverted to pay down U.S. debt.¹

The real US unemployment rate is 16 percent if persons who have dropped out of the labor pool and those working less than they would like are counted, a Federal Reserve official said Wednesday. "If one considers the people who would like a job but have stopped looking -- so-called discouraged workers -- and those who are working fewer hours than they want, the unemployment rate would move from the official 9.4 percent to 16 percent, said Atlanta Fed chief Dennis Lockhart.²

And yet, in spite of all this encouraging news, the masterminds behind the fiscal policies that created this mess keep their jobs and are heralded as geniuses for leading us out of this crisis. President Obama re-appointed Ben Bernanke as Chairman of the Fed to serve another four years.

Peter Schiff commented on the appointment by saying, “Bernanke is being praised for avoiding a collapse in the financial system. While he has forestalled some short-term pain, he has in turn forsaken long-term gain. The 'green shoots' that set the pundits alight are nothing more than the direct effects of massive monetary expansion. What we have is nominal growth in the unproductive service and consumption sectors. In short, Bernanke is being praised by the drug addicts for not cutting them off. But the thing about addiction is that the longer you stay hooked, the more deadly the withdrawal.³

Stocks spent another week chopping around. It spiked up to a new recovery high Friday before quickly retreating in minutes. Once again I need to report that extremely low volume is the culprit for a "strong" market.

There has been one major change this week...the big money is starting to sell the "good" news.   I am running out of time to warn you that not all is right and not much is real in terms of numbers and reports. I am not trying to be a doom and gloomer but am attempting to have you look through the numbers realistically and come up with your own conclusions.

We have a very expensive market, the real unemployment rate is 16%, (admission by a fed official), and a consumer that is either cutting back on consumption (yea!) or can't afford to consume.(boo) This, my friends is not the recipe for any REAL recovery. Do you want to rely on the policies of the government or the fed? That is the only hope this market could ever go ARTIFICIALLY higher.

On its own merit, this market in no way belongs at these levels. If you still think this is a healthy strong market consider this, for the past few days Citigroup (taxpayers own a third), Fannie Mae, Freddie Mac (placed under government conservatorship), and Bank of America (needed 45 billion in bailout money) have been far and away the most actively traded stocks on the New York Stock Exchange. These 4 financials comprised 40% of the overall trading volume on the NYSE this past Tuesday! Scared yet?

The market is as thin as a wafer and is pure speculation, having NOTHING to do with the real world. Why would you stay invested in a market that by past fundamental valuations is ridiculously overvalued? Now the Fed tells us that if information is disclosed on who got emergency loans and how much might cause a panic! Wow! Now that statement should get everybody sprinting for the exits.

Money manager optimism reached an extreme level of 89% bulls this week. When everybody is bullish, head for the hills, when everybody is pessimistic then it's time for a rally. Another reason to head for the hills is insider selling has reached a 30 to 1 level!  If insiders are dumping their own shares at an astonishing rate, shouldn't you?

We are coming to a historically tumultuous period in September and October. The market is vulnerable. I expect the fireworks will start after Labor Day.

Treasuries rallied early in the week as the fed monetized a good chunk of paper this week. That means they printed money to buy our own treasuries. Does that sound like good policy? I don't know any country that ever printed their way to prosperity or out of a problem.

The Obama White House came out with a more realistic budget for the next 10 years and we are going to run a 9 TRILLION deficit over that period! But wait....that is assuming the government does not increase spending. So, if the government can't increase spending, what do you think happens with the economy?  The only expansion in the economy today is the government. Can you say no way out? As repeated every week, This will be a sector that I would avoid long term at all cost. Our debt in 10 years will be $20 trillion. We will have a tough time with interest payments.

The dollar remained quiet this week down slightly. This is the calm before the storm. I expect action to really pick up post Labor Day.

Gold and silver zoomed higher on Friday. This trade will take its cue from the U.S. dollar in the weeks to come. Does the dollar rally like last year or does it tank? We'll know soon. I remain Bullish longer term (4 year time frame).

The number of Israelis who see US President Barack Obama's policies as pro-Israel has fallen to four percent, according to a Smith Research poll taken this week on behalf of The Jerusalem Post.

Obama's popularity among Israelis has been plummeting since a May 17 Post poll on the eve of a meeting between Prime Minister Binyamin Netanyahu and Obama at the White House. In that poll, 31% labeled Obama pro-Israel, 14% considered him pro-Palestinian, 40% said he was neutral, and 15% declined to give an opinion.⁵

According to an article in the Christian Science Monitor, “…the French position on Iran's missile and nuclear ambitions has become tougher than the American one – though not widely advertised.”

French President Nicolas Sarkozy, in an annual talk to the gathered French ambassadors, had sharp words for Iran, saying the same leaders that claimed its recent elections were honest and fair are also those who say its nuclear program is peaceful. “Who can believe them?” he asked.⁴

We have enjoyed a relatively quiet summer as far as geopolitical events are concerned. But remember, that can all change in a moment. Israel will not tolerate a nuclear Iran. Iran does not seem willing to give up its nuclear ambitions. North Korea and Russia are sitting on the sideline…waiting for the right moment to jump into the game.

These are perilous times. Don’t get lulled to sleep…for at a moment when you least expect it… That is why it is absolutely essential that you live in a state of preparation. If you have begun to use up some of your stored food, water, and other essentials…replace them now. You do not want to be caught off guard when then next major geopolitical event takes place.

Pastor Andy Stanley writes in his book The Principle of the Path, about the verse that prompted me to begin writing the GPUpdate 22 weeks ago. If you’ve read the update for many weeks you’ve certainly read the verse in Proverbs: “The prudent see danger and take refuge, but the simple keep going and suffer for it.” (Prov. 27:12)

Pastor Andy writes, “This verse introduces us to two kinds of people—the prudent and the simple…Both are headed down the same path. Both “see danger,” but they react differently. And, consequently, they experience two very different outcomes.”

He goes on to say, “The primary difference between the prudent and the simple is not what they see buy how they respond to what they see.” When the inevitable consequences of our actions, whether personal, or corporately as a country, begin to take effect, how we have prepared for our future will make all the difference in our lives.

Are you heeding the warning signs? Are you thinking that somehow America will be the exception to the rule and that we actually can spend our way out of our financial hole? Are you hanging on to the hope that we will win some kind of cosmic lottery and be able to pay off all of our national debt?

Prudent or simple—the choice is yours—but be careful…the simple are doomed to suffer.

Editor’s note: Check out the Global Perspectives web site and see the new features, polls, news links, and past issues of the GPUpdate. (www.globalperspectives.info)

¹http://news.yahoo.com/s/nm/20090825/pl_nm/us_obama_budget

²http://www.breitbart.com/article.php?id=CNG.4452bed82adf3124e5884678e236d7fb.361&show_article=1

³http://www.europac.net/externalframeset.asp?from=home&id=17079&type=schiff

⁴http://news.yahoo.com/s/csm/20090826/wl_csm/oeurodeal

⁵http://www.jpost.com/servlet/Satellite?pagename=JPost/JPArticle/ShowFull&cid=1251145138121

⁶Market commentary is provided by Mr. Steve Meyers of Grainbelt Commodities, Marco Island, FL