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Guest Post: Memo To Bernanke: It's Called Blowback, Baby

Tyler Durden's picture





 

Submitted by Charles Hugh Smith from Of Two Minds

Memo to Bernanke: It's Called Blowback, Baby

The covert manipulation of the domestic economy has set up ideal conditions for massive domestic blowback against the responsible agencies such as the Federal Reserve.

Broadly speaking, "blowback" is the unintended consequence to the civilian population of secret government operations. It is typically used to describe the consequences of overseas covert operations:

Blowback:

The term blowback first appeared in the the CIA internal history of the US’s 1953 Iranian coup d'état. Examples of blowback include the CIA’s financing and support for Afghan insurgents to fight an anti-Communist proxy guerilla war against the USSR in Afghanistan; some of the beneficiaries of this CIA support joined al-Qaeda's terrorist campaign against the United States.

But there is another kind of blowback brewing in the U.S.: the negative consequences of massive covert manipulation of the domestic economy by the Federal Reserve and agencies of the Federal government. A key feature of propaganda is the "documentation" presented to support a politically advantageous distortion.

In this case, the statistical support for the "recovery" rests on three numbers:

1. the stock market

2. the Federally issued jobs report

3. the GDP

In all cases, the numbers are doctored in a coordinated covert campaign to persuade the public that the economy is growing smartly. The stock market has doubled as a consequence of a declining dollar and other policies of the Federal Reserve designed to incentivize speculation in "risk trades" such as stocks and "carry trades" in currencies.

I have broken down the distortion many times, for example: The Stock Market As Propaganda (March 10, 2010).

The jobs report is heavily reliant on the "birth-death model" of small businesses, an opaque Federal guesstimate of the number of new small businesses being started and those being closed.

As reliably as clockwork, hundreds of thousands of "created out of thin air" jobs are logged as if they were real by the Bureau of Labor Statistics' "birth-death model." Yet in the real world, the number of small businesses has been in a three-year free-fall: Few Businesses Sprout, With Even Fewer Jobs (WSJ.com).

In the real world, small business income is down 5%.
Small Business: Still Waiting for Recovery.

According to data from the Bureau of Economic Analysis. Proprietors' income-- the profits of unincorporated businesses such as partnerships or individuals who work for themselves--is down nearly 5 percent from two years ago, while corporate profits have jumped 21 percent in that period.

About 19.9 million partnerships and sole proprietorships with no employees existed in 2008, the latest year for which U.S. Census Bureau data are available. That number fell almost 2 percent from the previous year.

In a private-sector workforce of about 106 million, that's about 19% of all people with a job. Recall that the BLS counts you as employed if you work one hour a week or if you're "self-employed," even if you aren't making a dime.

Only in the world of massaged statistics does nobody notice that self-employed people who are seeing revenues and profits fall do not need to hire someone: they're sinking all on their own.

Small business understands uncertainty is now permanent. That's why 26% of all new private-sector hires are temporary.

Buried deep in the "news" announcing 244,000 new hires last month is the reality that income rose by a paltry 1.9% and hours worked were flat. The broader measure of the unemployment rate, which includes people who stopped looking for work and those settling for part-time jobs, rose to 15.9% in April from 15.7% the previous month.

The GDP rises because the Federal government has borrowed roughly $5 trillion in the past three years and sent much of it out as "income" where it is of course added to the GDP. Never mind where the money came from or what it will cost our children--the only thing that matters to the manipulation operation is that GDP rises every quarter. If it doesn't, then the "recovery" lie collapses.

According to the Consumer Metrics Institute, their Daily Growth Index resumed its movement into record negative territory, setting a new all-time low representing a 6.39% year-over-year contraction on May 3, 2011.

Although our data about consumer spending is clearly weaker than that being provided by U.S. Bureau of Economic Analysis (BEA) or the U.S. Department of Commerce (DOC), there are a number of reasons to suspect that the consumers that we monitor really are less enthusiastic about the economy than Mr. Bernanke:

-- We have often commented that the metrics used to measure retail sales are seriously flawed, creating at least a "survivor bias" in the statistics and a sampling bias that over-represents the elite large cap retailers. We have expected that the numbers would eventually be quietly revised. Last week the Census Bureau did exactly that, lowering their baseline historical data substantially for some segments of the retail sales data. Specifically, they reported that 2010 "furniture and home furnishings stores" sales were 3.6% weaker than previously reported (turning a meager 0.8% year-over-year gain into a -2.4% contraction), the highly discretionary "sporting goods, hobby, book, & music stores" group was down 3.9% from the 4.6% in prior reports, and the less easily sampled "miscellaneous store retailers" dropped some 6.7% from their earlier numbers (nearly wiping out completely the earlier 7.6% alleged gain).

On the flip side they also noted that gasoline stations had actually collected sales that were 4.6% greater than what the Census Bureau had told us before -- indicating that their sampling methodologies grossly under-reported the impact of rising pump prices.

Our problem has always been the reliability of the reports, since their version of history often undergoes dramatic rewrites long after the fact. In this particular case a 7.6% year-over-year gain becomes a 0.9% year-over-year gain, and a 0.8% year-over-year growth was admittedly actually a 2.4% contraction -- all done quietly and without media scrutiny. In short, retail sales were not as good as previously purported -- for all the reasons we have previously described -- and hardly anyone noticed.

-- We have always held Gallup's measures of the the U.S. consumer's psyche with high regard -- if for no other reason than that their very livelihood depends (unlike the BEA or DOC) on them evolving their polling techniques to stay in contact with even those "households" that connect with the outside world only through Facebook or Twitter. They have recently published three polls that show far greater consumer caution than is commonly suspected:

Last week Gallup issued their regular update on consumer confidence. In it they found that only 27% of U.S. consumers feel that economic conditions are "getting better," down from 41% who responded in the same manner one year ago.

In a separate poll they found that self-reported consumer spending was flat in April and essentially flat year-over-year. This means that there was actually a reduction in discretionary spending, since relative to a year ago consumers were also reporting that a substantially larger share of that spending is going for gasoline and groceries.

And in yet another consumer view of the economy, they reported that over half of U.S. consumers think that -- at least for them -- the 'Great Recession' has never ended. Although the polling numbers have improved since the very bottom of the recession, they have again deteriorated from last year.

-- And it isn't just U.S. consumers who are being cautious. Eurozone consumers have also become more frugal, with German consumers in the vanguard with a 2.1% monthly contraction in spending. The overall drop is 1.7% for the year, and it is now at the lowest level since November 2009. The German thrift is even more remarkable given that unemployment is far less of a concern there than anywhere else in Europe. And in some countries the downturn is clearly not a one-month fluke: the March 1.4% fall in retail sales in Spain extended the string of losses to twelve consecutive months.

In other words, the "recovery of consumer spending" is bogus. The pyramid of the American economy is instructive:
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Memo to Mr. Bernanke: it's called blowback, baby, when the public finally sees through the covert ops propaganda. The institutions which are reporting the "proof the economy is recovering" will lose what remains of their credibility, as will a Mainstream Media which has unquestioningly "reported" the distortions as fact for years.

All this coordinated misinformation and distortion is setting up the delegitimization of the complicit institutions
, which include the Federal Reserve, the Treasury, the White House, Congress, and all the agencies tasked with documenting the "recovery."

Today the stock market is rallying on the wondrous "news" of hundreds of thousands of new jobs created--the last of the three metrics which the Status Quo needs to complete its picture of "recovery." As the gap between the "good news" and reality widens, the forces of blowback and delegitimization only coil tighter.

 


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Fri, 05/06/2011 - 11:09 | Link to Comment Herne the Hunter
Herne the Hunter's picture

Blowback!

Silver back at $36...

Gold almost back at $1500...

WTI at $102...

Fri, 05/06/2011 - 11:15 | Link to Comment SheepDog-One
SheepDog-One's picture

Their propaganda costs them huge sums now and growing, while the effectiveness drops measured only in a few hours now. What will be this weekends propaganda diversion, full scale alien invasion to take peoples minds off the govt and bankster lies?

Fri, 05/06/2011 - 11:28 | Link to Comment Cindy_Dies_In_T...
Cindy_Dies_In_The_End's picture

Some of you folks don't get it sometimes, sure THEY are self-interested, but they also know, in their self interest they can only push their model so far.

 

The real problem is a one of limited choices: that of a pancake "Splat" landing, OR that of a decline that is between Splat and well, a gentler splat.

contrary to the absolute parasite model, these folks would like to have their cake and eat it too, but only so far as they can avoid a Tunisian outcome.

 

Ben has limited choices, and he knows it.

 

the other problem is, that knowledge spread across the internet has seeped into some of the bourgeiois. People know things faster than they can spin.

Sat, 05/07/2011 - 04:26 | Link to Comment michigan independant
michigan independant's picture

I would not say "that of a decline that is between Splat and well, a gentler splat."

Cratering in segments that cannot be replaced or repaired now. You ask any manager what do they need? It will illuminate your view of the empire.

 

Fri, 05/06/2011 - 11:26 | Link to Comment john39
john39's picture

is not beyond the realm of possible that the backlash is also part of the programming:

http://www.the-savoisien.com/blog/public/img21/illuminati/unlimitted/.ba...

Fri, 05/06/2011 - 11:48 | Link to Comment dr_teeth
dr_teeth's picture

Blowback, isn't that when you take a large dump and the toilet water splashes back onto your ass?  Oh, wait, that's splachback. Well, it's almost the same thing.

Fri, 05/06/2011 - 11:53 | Link to Comment r101958
r101958's picture

Their propaganda costs us huge sums. All the trillions will be/is being paid for by us, one way or another.

Fri, 05/06/2011 - 16:23 | Link to Comment Doña K
Doña K's picture

keep buying coins in equal time intervals and sleep tight.

If everyone bought one coin (silver and gold) we will break them

Fri, 05/06/2011 - 12:15 | Link to Comment Dollar Bill Hiccup
Dollar Bill Hiccup's picture

If they do a good job countering Blowback, could one then say that it's a Blowj-b?

Fri, 05/06/2011 - 11:09 | Link to Comment NOTW777
NOTW777's picture

goolsbees performance this morning was over the top - talking booming job market - claiming "millions" of jobs

Fri, 05/06/2011 - 11:51 | Link to Comment nope-1004
nope-1004's picture

Goolsbee reminds me of the muppet character "Beaker".  Mouth never stops flapping, but nothing of substance comes out.  The guy is simply there to say shit for a paycheck.  If he believes what he's saying, then he truly is an idiot.

 

Fri, 05/06/2011 - 12:14 | Link to Comment newworldorder
newworldorder's picture

He has been granted one of the best "Economics" education money can buy from the University of Chicago.

This coupled with a lobotomy upon admittance, guarantees an economist that the financial elite can depend on forever.

Fri, 05/06/2011 - 13:03 | Link to Comment Manthong
Manthong's picture

Isn't that the same esteemed joint that gave us tenured terrorist now retired pensioner professor, and Obama ghost writer William Ayers?

Fri, 05/06/2011 - 15:06 | Link to Comment Dirt Rat
Dirt Rat's picture

The University of Chicago gave us all kinds of fun people, like the Dark Prince of neo-conservatism Leo Strauss, Augusto Pinochet's economic advisors and Cass Sunstein. I could go on and on about other things and people they've given us, but if I did that, we'd all need barf bags.

Fri, 05/06/2011 - 11:10 | Link to Comment InconvenientCou...
InconvenientCounterParty's picture

fiat is a confidence game, a notion.

Notions are extremely asymmetrical in terms of elapsed time. It takes a long time to garner a notion but it can be lost in a very short time.

 

Fri, 05/06/2011 - 13:21 | Link to Comment TheMerryPrankster
TheMerryPrankster's picture

A tight rope walker crosses on a slender line, a net beneath him and a balance pole in his hands, 2 levels of protection ensure a safe crossing. Remove the net and balance pole and any error is fatal.

Now what happens if a computer glitch, a hack, or some other curious event prevents 44 million SNAP (food stamps)  cards from being refilled with credits at the beginning of the month? 1 in 7 americans without food, could make a large angry crowd in any urban area. What happens when gas becomes so expensive its no longer practical to burn it in automobiles, but emminently practical to burn it in molotov cocktails?

 

My point is all safety nets have been dismantled or cannibalized to maximize profits for the slender number of real americans who really do matter to the corrupt oligarchy, they have convinced themselves they are immune to reality. Royalty in France had this same out of touch quality to it, right up until they felt the cold steel of the guillotine blade across their sweaty necks.

 

The system is creaking, failing under its own weight, we can see it in food stamp participation, unemployment and general incompetence by the political class. The days for preparation grow short, at most we have until 2015. Things could fall apart a lot faster and a lot sooner. At worst we will go back to living as our great grandparents did, electricity may become a luxury denied most of us. Plan accordingly.

 

An inverted pyramid is not a very stable structure.

Fri, 05/06/2011 - 11:16 | Link to Comment SheepDog-One
SheepDog-One's picture

They know theyre screwed, the clock is winding down fast so thats why theyll need a really huge diversion to throw everything on its ear, spectacular horrible events to shock the american sheeple so that the lying govt and media and FED statistic spin and lies are the last things on anyones minds. Soon.

Fri, 05/06/2011 - 11:29 | Link to Comment durablefaith
durablefaith's picture

+1

Fri, 05/06/2011 - 11:10 | Link to Comment rufusbird
rufusbird's picture

".....the forces of blowback and delegitimization only coil tighter." This could have surprise ending like the monkey...

"The master took a small group of students into the forest where he hung a dried gourd from a tree.

The gourd had a small hole through which he filled the gourd with sweet sticky rice.

The class withdrew to watch. After a while a troop of monkeys came along and one of them put his fist into the gourd to grab a handful of the sweet smelling rice. When he couldn't withdraw his hand he began to screech. This attracted the attention of a leopard lurking nearby who quickly killed and carried off the monkey.

The master asked the class “What was the trap that killed the monkey?”

“The gourd?” asked, one. “The rice?” asked another...”No” said the teacher....”greed”.


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Fri, 05/06/2011 - 11:10 | Link to Comment Gloomy
Gloomy's picture

This is BS. My kids are looking for jobs and the market is definitely much better. Yes, QE has goosed the economy. Get over it and move on.

Fri, 05/06/2011 - 11:16 | Link to Comment SheepDog-One
SheepDog-One's picture

I hear McDonalds is hiring. No wait, they already hired. Well good luck to your kids in their job hunting, theyll need it with an idiot parent like you.

Fri, 05/06/2011 - 12:32 | Link to Comment Gloomy
Gloomy's picture

It is blind not to see an economic recovery. It is also blind not to see that all the newly printed money will flow through the improving economy to cause much higher inflation.

Fri, 05/06/2011 - 16:31 | Link to Comment Doña K
Doña K's picture

My family is taking your advise to move on. We are moving to a more stable country before it's too late and transportation is not available at any cost and the borders are sealed just like the iron curtain.

Revolt now before it's too late.

Fri, 05/06/2011 - 11:19 | Link to Comment Josh Randall
Josh Randall's picture

Of course the job market is better for kids, because they are cheaper and will displace a more seasoned expensive worker. Thats the new model Gloomy -- hire young, cheap, and work em 60 hours a week, while you fire the 80-100k+ Team Lead or Manager. Then outsource the backoffice operations and VOILA, you have a lean cheaper company with less overhead and fixed costs

Fri, 05/06/2011 - 11:55 | Link to Comment r101958
r101958's picture

Very well stated Josh.

Fri, 05/06/2011 - 11:30 | Link to Comment Cindy_Dies_In_T...
Cindy_Dies_In_The_End's picture

Keyword being "looking" not "my kids just got or HAVE jobs"

 

Glad to see Hopium is alive and well. Hope your kids are smarter than you.

Fri, 05/06/2011 - 11:42 | Link to Comment takinthehighway
takinthehighway's picture

Wishful thinking 'cause the kids are 20somethings still living at home?

Fri, 05/06/2011 - 12:12 | Link to Comment Mariposa de Oro
Mariposa de Oro's picture

My friends who USED to work at the Kennedy Space Center in Florida are STILL without jobs.  The few that are still employed don't know what they're going to for work when they're finished mothballing the Shuttle.  The only reason I'm still employed is because I saw the crap coming and headed overseas.  Last fall my employer had a RIF.  Some of those folks STILL don't have jobs.  We're expecting MORE lay-offs later this summer.  The only thing 'goosed' by QE is the damn stock market.  The rest of us are slowly becoming dead ducks.

Fri, 05/06/2011 - 14:47 | Link to Comment PrintingPress
PrintingPress's picture

Key word "looking". 

Fri, 05/06/2011 - 11:14 | Link to Comment Josh Randall
Josh Randall's picture

Blowback - just like a Vegas flash mob at a convenience store...

http://www.8newsnow.com/story/14575982/mob-of-thieves-swarms-las-vegas-convenience-store

See if these people were REALLY smart, they would have hit a department store. But I guess the masses are satisfied with free Monster energy drink, bad beer, and twinkies when the costs of food and energy are too much

 

Fri, 05/06/2011 - 11:31 | Link to Comment Cindy_Dies_In_T...
Cindy_Dies_In_The_End's picture

josh: wait for it.

 

Crime is already rising in many cities.

 

They will take what isn't given, so be vigilant.

Fri, 05/06/2011 - 12:07 | Link to Comment csmith
csmith's picture

No way to steal several hundred gallons of gasoline I guess...would take too long.

Fri, 05/06/2011 - 11:14 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Bernanke doesn't care.

 

Flash Crash Anniversary:

http://lhmarketwatch.blogspot.com/2011/05/flash-crash-anniversary.html

Fri, 05/06/2011 - 11:16 | Link to Comment treemagnet
treemagnet's picture

Use this time to prep for bad times - truth is yours to use, so use it wisely.  Its also a great way to channel anger over the fraud, lies, and corruption.  Eat the rich.

Fri, 05/06/2011 - 11:26 | Link to Comment SheepDog-One
SheepDog-One's picture

Thats right, when youre out shopping for tarps and water purifiers and your friends make fun of you because theyre out shopping for new IPads and youre just not kewl, you just smile at them.

Fri, 05/06/2011 - 11:41 | Link to Comment takinthehighway
takinthehighway's picture

And these same "friends" will show up at your door at TEOTWAWKI +1 demanding that you take care of them...

Fri, 05/06/2011 - 11:46 | Link to Comment SheepDog-One
SheepDog-One's picture

Funny, I already tell my sheeple friends 'When you see the SHTF, dont come around here! Go to the Apple store theyll help you'. I'll stack em out back like cord wood. 

Fri, 05/06/2011 - 12:11 | Link to Comment treemagnet
treemagnet's picture

My Dad gives me shit but knows deep down I'm spot on when I tell him I know I'm the first call he'll make.

Fri, 05/06/2011 - 11:27 | Link to Comment falak pema
falak pema's picture

Blowback is economic backlash...if it combines with social outcry... it becomes explosively unstable in the ghetto and spreads like the plague to the middle class now compressed worse than a kleenex in a man's hip pocket or a woman's menstrual pad. Squeeze where it hurts and the ouch is heard around the globe like a gathering twitter that sends shocks to those who think they're immune to tsunami damage. Watch them run when the people's dam bursts...running wild in the streets like molten ire belched by the gods.

Fri, 05/06/2011 - 11:30 | Link to Comment Kina
Kina's picture

The moment will begin when their flat screen tvs are taken away, and they all look up and start crying like a baby whose dummy has been stolen. OR when beer becomes too expensive.

Fri, 05/06/2011 - 12:22 | Link to Comment Abitdodgie
Abitdodgie's picture

You would not be English by any chance

Fri, 05/06/2011 - 14:48 | Link to Comment falak pema
falak pema's picture

not even in my wildest dreams.

Fri, 05/06/2011 - 11:26 | Link to Comment PaperBear
PaperBear's picture
Physical silver COMEX inventories continue to shrink while increases in margin for a futures contract have gone parabolic.
They hold only 33MN oz these days versus 3BN oz in 1955 - if my maths serves me correct then this is a 99% reduction.
The Silver Liberation Army has the criminal banksters in the pain locker - WOOHOO
Fri, 05/06/2011 - 11:26 | Link to Comment JR
JR's picture

The economy — that’s where Bernanke is getting the value for the stock market.  Only a fool would ignore it. How long will the savers and jobless and underemployed and stagnant workers, the house bitten and the bubble victimized investors, need to suffer for the benefit of inflation building and “massive covert manipulation” for the financials?

Fri, 05/06/2011 - 11:27 | Link to Comment breezer1
breezer1's picture

charles is a very good writer. for those of us less talented the word bullshit carries the day. 

as for calls for another ' distraction', i agree that something planned or a black swan will need to distract very soon.

Fri, 05/06/2011 - 11:31 | Link to Comment SheepDog-One
SheepDog-One's picture

Hardly anyone 10 years ago knew the scam that the 'FED' is widely recognized as today, very few question what money is...now everyone is on the internet talking about the FED fractional fiat central banksters, the Federal Reserve Note fraud, how its really worth nothing. Now maybe they still have the 401K geezers and the 20-something credit consumers onboard, but thats about it. Everyone else now knows its a rigged game of slavery for the many, all riches to the very few.

Fri, 05/06/2011 - 11:33 | Link to Comment Waterfallsparkles
Waterfallsparkles's picture

The Stock Market doubling does not create confidence.  Instead it creates resentment among Americans. 

They slowly watch themselves being sacrificed with the lower Dollar purchasing power, Higher Food costs, Higher Gasoline costs, Higher Heating costs, Higher clothing costs.  No interest on their savings, no COLA for Social Security for 2 years.  How does this make them feel better about the economy.  It is quite the reverse as they resent the Banks that killed the Economy being the only ones that have benefited from the "RECOVERY".   Recovery, for who?  Not for the Middle Class.  This causes resentment and will end up with class warfare.

Bernanke may have studied the Great Depression but he must have skipped earlier History.  Like the fall of Rome, Egypt (let my people go), Marie Louie Antoinette, the French Revolution, the Tea Party, the war of 1812.

Fri, 05/06/2011 - 11:34 | Link to Comment Kina
Kina's picture

How many Americans, up to their necks in debt before the crash, had spare money to invest in the share market anyway?

 

They are going to be mighty angry if they ever realise that the net result of the Fed & Govts recovery effort has been to make the powerful their masters and the rich richer at the expense of teh middle class.

Fri, 05/06/2011 - 12:28 | Link to Comment Mariposa de Oro
Mariposa de Oro's picture

As long as the TeeVees work, the sheeple will never realize anything.  Talk about a WMD.

Fri, 05/06/2011 - 15:02 | Link to Comment Meatier Shower
Fri, 05/06/2011 - 11:36 | Link to Comment SheepDog-One
SheepDog-One's picture

I agree, most people I know look at the stock markets with resentment. Theyre now getting onboard with realizing its all just a scam, and they are basically the slaves no matter what to a few rich no matter how honestly they play the game the rug gets pulled out anyway and back to square 1. When the avg Joe starts talking about the BS central banks and money printing and worthless FRN's, you know their time is short.

Fri, 05/06/2011 - 11:50 | Link to Comment treemagnet
treemagnet's picture

My farmer friends don't even know who the fuck this "Ben Bernanke" dude is.

Fri, 05/06/2011 - 12:16 | Link to Comment JR
JR's picture

That’s it, in a nutshell: “basically the slaves no matter...how honestly they play the game the rug gets pulled out anyway and back to square 1.”

Your observation that “when the avg Joe starts talking about the BS central banks and money printing and worthless FRN's, you know their time is short,” reminds me of the famous example on how to identify an approaching collapse in the stock market: it’s when your taxi driver starts giving you hot tips on stocks.

IE: it's game over for the Fed.

Fri, 05/06/2011 - 12:05 | Link to Comment JR
JR's picture

Waterfallsparkles...

The pain from the policies of our unelected masters needs to be put into words - like yours.

Fri, 05/06/2011 - 11:34 | Link to Comment alien-IQ
alien-IQ's picture

Historically, all attempts to subjugate the American people have been met with catastrophic results...this will be no different.

While Americans may not be the brightest bulbs on the tree, they will eventually figure out they are being lied to and they will react...in a very American manner.

It's only a question of time.

Fri, 05/06/2011 - 11:39 | Link to Comment durablefaith
durablefaith's picture

Refresh us on some history please. Seems to me "they" have subjugated us rather effectively.

The civil war threw out states rights, trampling the tenth amendment. Attempt to hold onto rights ruthlessly crushed. 

1913 threw out sound currency. As for resistance, the Gold was confiscated and private ownership outlawed.

Todays states rights movement is mostly talk, toothless resolutions, as the Feds raid state sanctioned medical marijuana clinics and the states do nothing.

Our attempt to return to sound money is moral, right, brave, and the only thing that helps me feel less complicit with the elitist banker thieves. But that doesn't mean it will end well...

Fri, 05/06/2011 - 11:53 | Link to Comment newworldorder
newworldorder's picture

Eventually is a long time. This will take some time if ever, to resolve.

As to the reaction of the American people, I will invite you to do your own analysis of who the American people are as a function of their economic realities.

What part of the total population are currently defined as poor? How many derive all of their subsistence from government programs? How many have wealth not tied to their home? How many have traditional pensions (outside of government sector?)  How many are underwater in their home values and mortgages? How many are 2 income middle class with incomes of $75+k per anum. How many are "rich?" - $250+k

When you have answered these questions yourself, then ask - Who is going to lead this revolution? This type of change is not a part of the American experience.  You are seeing the future - namely more of the same as today.

Fri, 05/06/2011 - 12:41 | Link to Comment reload
reload's picture

You seem to be suggesting that the `Middle class` are now so outnumbered by welfare recipents and that many are now debt slaves with little positive equity in anything. I fear you are right, but eventually the government largesse WILL stop. The governments creditors will enforce austerity - OR there will be a big war, not a desert skirmish on the other side of the world. By the time government largesse and welfare ceases you assume that the middle class will already have been forced to stand in line with the welfare class. And again you may be right, however history does teach us that `cometh the hour, cometh the man`. Nothing lasts for ever, and nor will the age of gigantic government, reckless budget imballances and crony fascism.   

Fri, 05/06/2011 - 11:30 | Link to Comment Kina
Kina's picture

All this coordinated misinformation and distortion is setting up the delegitimization of the complicit institutions

 

  1. Well at least something good will come of it..dont leave out the regulators. Corrupt police is the first step of a crime wave.
Fri, 05/06/2011 - 12:40 | Link to Comment Waterfallsparkles
Waterfallsparkles's picture

Thank you for your post.

RISE IN THE STOCK MARKET CREATES RESENTMENT, not confidence.

How many people got stopped our of their positions in the 2008 CRASH, and lost a ton of Money?  How many people were invested in AIG, FRE, FNM, Ambk, Bear Sterns, Lehman, Washington Mutual, who were totally wiped out?  Wall Street had Insurance (CDS's) where they made BILLIONS on the demise of these Companies and the average American that invested in them.

How many people have since had to liquidate what was left of their 401K, just to live on or pay their underwater Mortgage?

How do you think these people feel about the Stock Market doubling in 3 years after they got sold out, wiped out or had to liquidate before the pump just to survive.  Confiden about the economy?  NO, PURE RESENTMENT.

Remember, the FED did not give them interest free loans to invest in the market for his PUMP.  Just listen to all of the laughter of all of the Traders that are making Billions.  It makes people feel like fools and losers.  It creates anger and resentment.

Fri, 05/06/2011 - 11:36 | Link to Comment newworldorder
newworldorder's picture

Bloomberg jobs article today:

http://www.bloomberg.com/news/2011-05-06/u-s-payrolls-increased-244-000-in-april-unemployment-rate-climbs-to-9-.html

Independent analysis will not reach the public. Even if it does most are unable to, or do not have the inclination to digest its true meaning. The path of least resistance is acceptance of the party line. Wishing it were different, will not make it so.

Thanks for the ZH contributors. As pessimistic as we sometimes are, its a small light in an endless darkness.

Fri, 05/06/2011 - 11:37 | Link to Comment Kina
Kina's picture

Unfortunately this is true. They will only learn something if their TVs are taken away and then they have to look up.

 

The next stimulus package will be free new TVs for all.

Fri, 05/06/2011 - 11:42 | Link to Comment entendance
entendance's picture

...don't forget us at the beach:
we fight banksters as well.
http://www.entendance.com/forums/search.php?search_id=active_topics

Fri, 05/06/2011 - 11:40 | Link to Comment SheepDog-One
SheepDog-One's picture

Well Im seeing many more people who would have been called 'sheeple' a few years ago really waking up to the BS, and they run into the truth all over the internet now on places like Youtube, much to the govt horror. But as much as the govt would love to censor it heavily or even shut it off, they know that would set off people to revolt as well. Theyre stuck with it for now anyway, their internet which THEY envisioned as a great populace control tool where people would only surf celeb puking photos and porn, is now a mass web of debunking govt and central bankster lies. Its a nightmare for them.

Fri, 05/06/2011 - 11:47 | Link to Comment treemagnet
treemagnet's picture

I think alot more people are getting their "game face" on.  Otherwise, who's buying all the freeze dried foods, etc.  And for that matter - I'd be curious to find out what percentage of this robust recovery is rooted in prepper spending - supplies, materials, generators, shipping, etc.

Fri, 05/06/2011 - 12:08 | Link to Comment newworldorder
newworldorder's picture

SheepDog-One;

I believe you are partially correct as it applies to those who use the Internet for research or collaboration. Most Internet sites however have become either deflectors or absorbers of information, content and opinion. It has been  segmented down to almost our individual likes and dislikes. Look at HPost, Drudge, Bloomberg, even ZH. Our individual participation absorbs our energy or deflect our anger into the blogosphere. Other than for information gathering, unless our Internet usage coalesces into action it is ultimately meaningless

Fri, 05/06/2011 - 11:35 | Link to Comment takinthehighway
takinthehighway's picture

Anecdotal evidence of small business creation - in my home area, most of the small businesses opened have been thrift stores.

Do yard sales count as "small businesses opened"?

Fri, 05/06/2011 - 11:51 | Link to Comment depression
depression's picture

Without question small business entrepreneurs using eBay, CraigsList, Yard Sales, Flea Markets all add measurably to the birth side of the B/D model.

"Despite headwinds from high energy prices and disruptions from the disaster in Japan, the last three months of private job gains have been the strongest in five years," said Austan Goolsbee, chairman of President Barack Obama's Council of Economic Advisers.

Fri, 05/06/2011 - 11:39 | Link to Comment madmax1965
madmax1965's picture

Small business guy here,  hired 12 employees in January, let them all go in April.  Had 20 until 2009,  Uumm.... recovery?  There will be no recovery until we END THE FED!!

Fri, 05/06/2011 - 11:41 | Link to Comment sethstorm
sethstorm's picture

Not so fast:

Small business understands uncertainty is now permanent. That's why 26% of all new private-sector hires are temporary.

So the solution is to simply pass on the uncertainty to someone who can't pass it on to someone else?  I'd beg to differ and suggest that entrenched temporary employment indicates a non-recovery.  The recovery begins where temporary employment ends.

Or even better - make it so that temporary employment multiplies the amount of benefits, but cannot require a raise in requirements.

 

Fri, 05/06/2011 - 11:41 | Link to Comment KillTheFed
KillTheFed's picture

I agree with Sheepdog.  We will have a big distraction coming soon.  Might be financial (Eurozone sovereign debt crisis...Spain?) or 'other'.  In any event, the dollar will be manipulated to be stronger in the short-term to keep borrowing costs low.  The end of QE2 will make the economic statistics start looking weaker than even the manipulated-up numbers currently are.  This gives political cover for QE3, which is the real agenda.  This export of inflation is intended to bring China into line and make them float their currency.  Until China capitulates to the bankers (so the bankers can ultimately control and wreck their economy) we will all be victims of the dollar destruction and distortion of our economy.

Fri, 05/06/2011 - 11:45 | Link to Comment Matxeu
Matxeu's picture

Fourth turning homeyz and beyotcheseseses

Fri, 05/06/2011 - 11:49 | Link to Comment Michael66
Michael66's picture

Note the jobs report show only non farm employment.

The average age of an American farmer is now 60+. Almost no young men are going into farming.  There are several reasons young men are no longer becoming farmers. First, the capital costs are far beyond their means. Second, farming in no longer profitable.

 

This is very soon going to become a very serious problem for Americans. 

Fri, 05/06/2011 - 12:16 | Link to Comment treemagnet
treemagnet's picture

All my farming buddies are absolutely rolling in cash.  The last few years were pretty good but 2010 was a wet dream that wouldn't end.  The mechanization allows fewer people to farm and its a generational business - they rent a shitload of land from their parents/family providing the folks with a nice income.  You're just not well informed.

Fri, 05/06/2011 - 11:52 | Link to Comment ZapBranigan
ZapBranigan's picture

Sorry Mr. Hugh, but "blowback" has always had it's origins as a firearms term. 

Fri, 05/06/2011 - 11:56 | Link to Comment writingsonthewall
writingsonthewall's picture

Where's Hammy?  - not around now that hi ho silver is back in town?

 

Hugh - your piece seems to sum up why Governments desperate to avoid 'the truth' end up creating a revolutionary atmosphere. At the end of the day people get more angry about being lied to than what the truth was that was being witheld.

When faith is lost in the media - then people stop believing everything - they won't listen to calls of "stay indoors" - like the Tunisians and Eqyptians didn't. This is when things become very, very dangerous.

 

The Government is playing with fire and simply doesn't realise it. It's better to accept the truth and say "you cannot control the beast" than convince everyone you can - hoping you can 'wing it' and make it through.

I found this interesting chart today - it shows how reolvutions are very mush related to the price of bread!

http://www.bbc.co.uk/blogs/newsnight/paulmason/2011/04/revolutions_and_the_price_of_b.html

This would be the inflation that Bernanke says is only in the stock market - remember???

Fri, 05/06/2011 - 11:56 | Link to Comment buzzsaw99
buzzsaw99's picture

Broadly speaking, "blowback" is the unintended consequence to the civilian population of secret government operations...

 

Like they care. The top 1% is the only thing that matters.

Fri, 05/06/2011 - 11:56 | Link to Comment Clowns on Acid
Clowns on Acid's picture

Fiat money, fiat Big Media, fiat politicians, fiat politically correct laws,.....nature don't like fiat. Boom !

Fri, 05/06/2011 - 11:59 | Link to Comment Strategery
Strategery's picture

The Bin Laden mess is an attempt to take the public's eye off of the real problems we have. Sorry, not working, except of course, for the sheeple.

Fri, 05/06/2011 - 12:11 | Link to Comment Henry Chinaski
Henry Chinaski's picture

I have anectdotal evidence that the economy is improving. 

A local gun shop has a new facility under construction.  And the Gander Mountian just had a major renovation adding a shooting range and training facility. 

Green shoots.  

Fri, 05/06/2011 - 12:49 | Link to Comment Shell Game
Shell Game's picture

Indeed.  Much of the popular ammunition reloading equipment on backorder at Midway, CTD, etc.  Business is brisk.

I now have to take a number at my local coin shop.  Business is very brisk.

Many dry grains, dry beans and plastic pails at Honeyville, etc. on backorder....business is, well, you get the pic.

Green shoots, Statist bitchez..

Fri, 05/06/2011 - 13:35 | Link to Comment benburnyanki
benburnyanki's picture

these assholes in charge (AIC) know they are making such a killing in their swiss bank accounts that if shit blows up and blows back, they will be floatin in a yacht off Greek Islands self contained full off canned tuna and Evion water bottles. We Sheep Are Fuked!!!!!

Our pirate school teaches maties to board yachts and 'grab the tuna' - Dial 1-800-TUNA-YANKER

Oh one thing you have to remember reading my posts is this:

Me namesake could be doing everything a pirate does and just have CNN tell you stupid ass sheep 'Everything is OK, Nothing to see here, These are not the Droids you are looking for"

Deprogram your mind by Irish Ex MI-6 agent gone good: www.coleman300.com Book Title:

The Committee of 300 by Dr. John Coleman

Fri, 05/06/2011 - 12:42 | Link to Comment alexanderstollznow
alexanderstollznow's picture

YEP, the "opaque" birth/death model:  so opaque you have to go the Internet to find information on it!  where will these crafty buggers think of hiding the information next? tora bora??

http://www.bls.gov/web/empsit/cesbd.htm

very amusing aspect of the article at the head of this thread is that, yet again, we have someone banging on about the Fed, and talking about things which have nothing to do with the Fed.  in this  case, it is BLS statistics. 

still, the we have to remember the Bloggers Credo:  'never let the facts get in the way of a good conspiracy'.

Fri, 05/06/2011 - 13:01 | Link to Comment acrabbe
acrabbe's picture

So you're implying that the Fed has no coordination whatsoever with government statistics agencies. BLS reports unemployment. Full employment is one of the Fed's mandates. For all intents and purposes there would be a minimum of communication between them. 

Back to the kiddie pool till you can swim a length without your floatie!

http://slv.collective2.com

Fri, 05/06/2011 - 13:05 | Link to Comment acrabbe
acrabbe's picture

oh. and birth/death is opaque because they use the adjustment as a plug-in number to reach their desired print. Think Goal Seek in Excel. 

Caaaaamaaaaaaan Alex!

Fri, 05/06/2011 - 13:12 | Link to Comment Bartanist
Bartanist's picture

Yes, but is that the plan? Maybe the name of the game is planning and managing blowback and specifically by giving people the tools to understand the nature of the fraud and to rebel against it... the internet being a perfet tool, and yet disturbingly controlled.

... and so as we wallow in hatred of those who oppress us and self loathing for how we have allowed it to occur ... looking for someone to save us from them and from ourselves.

Magically and mysteriously it appears ... maybe.

Fri, 05/06/2011 - 13:53 | Link to Comment benburnyanki
benburnyanki's picture

amazon.com description of www.coleman300.com book "Committee of 300":

Undoubtedly the “Bible” of conspiracy books, the completely revised and updated Fourth Edition landmark book is filled with information not previously disclosed. It names one of the contenders for the White House who is closely related to one of the oldest “300” families whose fortune was derived from opium trade with China, and no, it is not any of the Bush clan. The origin of the Committee of 300 is described; how it has evolved from an opium trading company with a Royal Charter to become the de-facto secret upper-level parallel government of the United States and the world, with only Russia and China standing in opposition to it.

A highly organized secret society with tentacles reaching into every level of government in the United States and indeed, the world, backed by massive financing and run by men of the highest education and intelligence, with vast resources at their disposal, manages the thousands of major political and economical and contrived situations.

Serco.com is just one of the semi secretive companies that runs the world for Queenie and her Lord Rothschild sock puppets: 

SerCo.com Video: http://youtu.be/lfBnJHvGQKY

Fri, 05/06/2011 - 15:32 | Link to Comment jmc8888
jmc8888's picture

I wouldn't say it de-legitimizes the institutions of the white house or congress, I would say it de-legitimizes the people who currently comprise the white house, congress.

As for the federal reserve, yep, it does both. De-ligitimizes the people and institution itself. 

The corporate media that played along, is toast.

Glass-Steagall

Sun, 05/08/2011 - 08:09 | Link to Comment Satan Rotchild
Satan Rotchild's picture

So you really think the U.S. gov't (federal, state, local) is nearly broke?  Think again!  The USA (United Scams of America) is not what you think it is.  Composite  U.S. government had liquid investment funds of over $60 trillion in 2000.  Assuming a stable rate of growth, USG's composite liquid assets would be about $125 trillion today!

Check these out:

http://video.google.com/videoplay?docid=6703413885850200097#

http://www.youtube.com/watch?v=COOJyitei3s

http://video.google.com/videoplay?docid=-5823209513192072459#

If/when corrorborating the fiscal reality revealed in comprehensive annual financial reports (CAFRs), make sure you download COMPLETE CAFRs.

Do NOT follow this link or you will be banned from the site!