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By Charles Biderman

I was on CNBC yesterday with Rick Santelli and after being cut short by breaking news, what I didn't get to say is that there is a global economic downturn ahead. Not a recovery, not even a slow recovery, but a US and global downturn. Here is why:

As I said on CNBC, wages and salaries grew about $380 billion in 2012. And some $60 billion of that gain was due to 2013 wages and salaries that were taken in December of last year because of the fear of tax hikes in the new year. That means that this January's wages and salaries will be $60 billion less than they would have been. Another way of saying that is: Everything else being equal, 2012's $380 billion in higher wages and salaries will drop $120 billion to $260 billion in 2013.

But everything else is not equal. Taxes on wages and salaries are going up by $150 billion this year. About $110 billion of that will be the result of higher employment taxes, $10 billion for Obama Care and about $30 billion more from the rich.

Here's what this all means for 2013. The $60 billion in wages and salaries taken last year for tax purposes instead of in 2013 means that without it, wages and salaries for 2012 would have been $320 billion. That money is now gone so that means $60 billion less in wages and salaries for 2013. Therefore, if we subtract that $60 billion and $150 billion in higher taxes that leaves a $110 billion year over year gain for 2013 versus 2012. That's all of 1.7% of $6.5 trillion in annual wages and salaries.

Here's more bad news. Most if not all, or even more of that remaining $110 billion isn't likely to happen in 2013. The $110 billion in increased wages and salaries in 2012 was the result of mortgage rates dropping below 4% at the start of last year. Real estate activity did spike but has been flat since the spring. Therefore, unless mortgage rates drop below 3%, home sales will be a negative when you compare year over year wages and salaries. So if my math is correct and absent any miraculous economic revival, at best the US economy will be flat this year in terms of wages and salaries.

Wall Street over the four years since 2009 has been trained to believe that the Federal Reserve will keep stock prices rising. However, now that interest rates are at zero, I've got to ask how much longer investors will keep believing that the emperor is fully clothed? To repeat what I've often said before: Wages and salaries and not GDP are the best indicators of the state of the US economy.

Remember, the US is not an island, but part of the global broadband economy. If US wage and salary growth stops, that will not help European and Asian exports. Without growth in exports, Europe will collapse even faster than it has been. And Asian growth also has to slump without higher US demand.

So if Europe and Asia slump that probably will push down US economic activity even further in the second half of this year. Therefore, my best guess right now is that US individual taxable income will slump in the first quarter of this year, have a slight rebound in the Q2 comparatively speaking. But then if Europe and Asia falter so will the US later this year.

But as of right now, recent economic activity looks good having been boosted by $60 billion in extra December 2012 wages and salaries and who knows how many extra billions in realized capital gains. That means there was lots of extra cash in consumers' hands, which explains why fancy car and trophy real estate sales boomed at year end.

However, now that we are in January most of that extra money has likely been spent or invested. Therefore, it will not be until the end of the month before the decline in wages and salaries will start to show up in economic numbers. And it probably will not be until the middle of February before the magnitude of the already existing economic downturn begins to be felt on Wall Street.

But until then, smile.

Source: Global Economic Downturn Ahead