Guest Post: Seeing Past The Hologram

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Thu, 09/02/2010 - 12:45 | 559848 Boilermaker
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What time is the bogus NFP number released to the front runners?

I'd like to snap up some SPG, VNO, BXP, IYR, and *of course* some DRN before they ramrod it 10% higher in a single trading session.

Thu, 09/02/2010 - 12:48 | 559857 Robslob
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True that...you can't trust a damn thing anymore.

 

It's like they knew in advance of the ISM (cough) so they ramped up...this time they know it will be bad and start to ramp (people will believe news was leaked) pile on then get creamed if they are bad...

 

What is up is down because down was up to begin with?

Thu, 09/02/2010 - 12:46 | 559862 Freebird
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Sound perspective imo.

Thu, 09/02/2010 - 12:47 | 559866 Raymond K Hassel
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+100

Thu, 09/02/2010 - 12:50 | 559870 Widowmaker
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One of the best Mark Twain quotes is, "always do what is right.  In doing so, you will gratify some and astonish the rest."

 

By no means is this applicable to the united states of fiscal collusion by the rich and robbery of the poor.

Thu, 09/02/2010 - 14:04 | 560035 Rasna
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Reverse Robinhood

Thu, 09/02/2010 - 17:22 | 560625 DaveyJones
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Robindrag or Robinthehood

Thu, 09/02/2010 - 12:52 | 559876 Big Corked Boots
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The concept of moving the USA back to a manufacturing economy is troubling. New manufacturing plants can be built with a much higher level of automation, such that human labor is needed less or not required at all. The electric power generation business has been doing this for years and the pharma industry is doing it now as well. Automation and robot technology is becoming less expensive, as tech usually does, and the only reason China has high manufacturing employment is that it hasn't become cheap enough to replace dollar-an-hour workers. I don't think the supply of cheap labor will move to Vietnam or Africa long term; I think labor simply won't be necessary. WTF do we do then? Go on welfare? We need a better plan. I think manufacturing is a panacea, an attempt to turn the clock back to a system that worked 50 years ago.

(IMHO)

Thu, 09/02/2010 - 12:57 | 559903 Bearster
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As long as the question is what do "we" (i.e. the government) "do" (i.e. coerce people by force), then the question is invalid and it cannot be answered.

With every improvement in the productivity of labor, going back to the industrial revolution (at least), people have fretted over what this will do to the wage earner.  What it will do is free up people who are currently needed to produce, say, food.  So then they can be hired to produce hovercraft, or unmanned mining vehicles to send to the asteroid belt, or nanomachines that automatically find cancer cells in the body and eliminate them.

 

Thu, 09/02/2010 - 13:07 | 559922 crosey
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What concerns me is that the next leg (nanotech, etc.) will require even greater levels of debt/capital to enable.  These resources no longer exist.

The only solution I clearly see is a massive rightsizing of the labor supply, and reduction in entitlement recipients.  Workers will have to go abroad or live at the poverty level; and we baby-boomers will be encouraged to die quickly.

Thu, 09/02/2010 - 13:53 | 560014 Caviar Emptor
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Work expands to fill the time available 

Thu, 09/02/2010 - 13:16 | 559938 Shiznit Diggity
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Don't worry, we can all go work on farms. Peak oil will soon turn agriculture back into an increasingly labor intensive industry.

Thu, 09/02/2010 - 13:29 | 559972 anony
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See Kurt Vonnegut for a vision of the future. Try, "Player Piano", for a glimpse if you haven't alrealdy.

Thu, 09/02/2010 - 14:33 | 560144 Azannoth
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We are still 100's of years from star to star space travel and you want to go back to the caves

Thu, 09/02/2010 - 14:47 | 560195 doolittlegeorge
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This is an excellent post.  Once we go "flying off to government universe" we are truly "Lost in Space."  There are "things" in that area that truly do not exist even though you see it with your own eyes.  The focus therefore must be "what will the banks do."  Do I sound like I am repeating myself?  If so it is because I AM.  The fact that "the government didn't know the trillion would disappear" should be found.........troubling.   In short "forget the fucking stimulus....the BAILOUT was catstrophe!" though I would argue "like slavery just one of those things your gonna have to do."   Insofar as what passes for "Wall Street" or obviously ANY street for that matter--WHO CARES!  For "the mulitude" of course they don't matter.  No news there.  It's the "minutiae-tude" that the Fed is focusing on...and how ironice noneother than Alan Greenspan himself said "We need to support the equity market."  GEE THANX YOU EQUITY MARKET DESTROYING AS;LDFJASLKJGLJSADG;;LSAADS;LFGJS;J!!!!!!!!!!!!!!!!

Fri, 09/03/2010 - 04:49 | 561382 Moonrajah
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Great point BCB. After the last decade or two of using cheap labor no manufacturing business in their right mind will relocate back to USA. Especially in the current environment of instability,a whacko corporatist-socialist goverment, expiring tax cuts and the monstrosity that is the Healthscare legislation to name but a few. That won't happen if the major population wouldn't agree to working for doggy snacks instead of a decent salary. And that ain't gonna happen voluntarily.

The only solution for US is to be a provider of quality services, and first of all in science and innovation in order to keep it's influence. Unfortunately with the situation in education (a lot of high-quality education is being effectively exported via visa-students to emerging markets, while many local ones are too depraved and have a redneck-IQ and understanding of the way things work in the actual world coupled with the fun-angle of education) I don't see this happening.

If some radical change doesn't happen (war, a new authoritan leader who doesn't bend for WallSt) then US is in for a slow and sad decline.

 

Thu, 09/02/2010 - 12:50 | 559879 DarkAgeAhead
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Of course it's real.  The FED proves it every day.  It may be a fleeting moment in time, but that makes it no less "real."

Economics, on the other hand, is fiction at its worst.

Thu, 09/02/2010 - 12:51 | 559882 Invisible Hand
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I am coming around to your viewpoint on inflation of things we need and deflation of things we don't have to have.

I also am beginning to think the dollar will drop significantly from here.

I agree that watching the mess that the FED and our govt has made of our economy and our future is distressing but please keep writing about things as you see them.

Very helpful, thanks

Thu, 09/02/2010 - 14:03 | 560033 Caviar Emptor
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Been saying here for months: Inflation of things you need (cost of living and doing business), deflation of individual net worth (real incomes, employment opportunities, real property, retirement assets (including SS and Medicare) ). 

This applies to individuals as well as small businesses (margins hit with increased input costs, decreased consumer discretionary spending). And that's exactly the two ingredients missing from this "Recovery". The engine of "growth" has been emasculated in a consumerist economy. The engine of employment (small business) is seriously constrained. Multinationals are moving the center of gravity abroad (to wit, the banks are hiring abroad, firing domestically). 

Thu, 09/02/2010 - 17:25 | 560632 DaveyJones
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well said

Thu, 09/02/2010 - 12:51 | 559883 tony bonn
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as i read my heart leapt and sung....finally someone who is willing to attack the criminal elements within.....expose evil....

money belongs in the hands of the people!! open the mint to gold!!

aux armes, citoyens

formez vos bataillons

marchons, marchons....

Thu, 09/02/2010 - 12:56 | 559900 LeBalance
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"How can people with a straight face come out and extrapolate anything from a market where the Federal Reserve is buying the debt of its own government!"

The Federal Reserve is ex-US government organization.  In my book it is supervising a receivership, since at the very latest 1932, but probably much earlier.  Even perfunctory research will allow understanding of this point.

In addition, absolute surety in Silver's Direction and upside is certainly interesting.  While "fundamentally" that may be true, what fundamentals are we following at this point?  And we believe that we are following the "fundamentals of a sane market," well is that true?  Does the power source we line up against (Big Brother) by owning specie, just shrug and scratch itself and act as it wishes to?

In summary, certainty in outcome is a wonderful thing.  It must be so that Silver and Gold will go to da moon.  I am also quite interested in the possibility that they might not.

Thu, 09/02/2010 - 13:00 | 559910 DarkAgeAhead
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Exactly, it is well past time to at least question how 'fundamental' the fundamentals are as we know/knew them.  These days, trust in the firmness of the past is risky, if not an inherent folly.  From economics to ecology, shit is changing, and faster than most will be able adapt.

The only trust I have left may be in the laws of Nature, as well as those best and worst common characteristics of Humanity as a species.

Thu, 09/02/2010 - 13:01 | 559912 cyclemadman
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I am going to put my faith in thousands of years of human history that have viewed gold and silver as valuable.

Thu, 09/02/2010 - 13:23 | 559956 DarkAgeAhead
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Under reasonably "normal" circumstances, definitely a great bet.  And probably a good one for the next 25 years or so. 

But once the immensity of ecological shit unleashes, it will be about food and water, as it was before silver and gold.

Thu, 09/02/2010 - 14:10 | 560059 crosey
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+100.  Observe our 3rd world brothers and sisters, and see our future, in terms of the value of food and water.

Thu, 09/02/2010 - 14:51 | 560213 doolittlegeorge
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you all are failing to understand the "cross purposes."  the Fed's job is to support the banks/the Fed's job is to support the government.  Rinse and repeat.  In short your thesis that the Fed's job is to support the government doesn't work.  It's job is to support the banks.  The fact that the government is obliterating the banks is not a surprise--least of all the Fed.  The government can eliminate the Fed.  Okay.  That says SUPPORT THE BANKS.

Thu, 09/02/2010 - 12:58 | 559908 uno
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From Bloomberg via Gata

 

PBOC Researcher Says Gold May Slump on Central-Bank Selling, News Reports

Investors should be alert against a gold price slump as overseas central banks like the U.S. may dump gold while the global economy is facing uncertainties, the Financial News reported, citing Zou Pingzuo, a researcher with the People’s Bank of China.

Thu, 09/02/2010 - 13:17 | 559940 RockyRacoon
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Our Central Bank (Federal Reserve in this case) cannot sell off the gold supposedly held at Ft. Knox.  The gold is under the "control" of the U. S. Mint and audited (ha!) by the Treasury.  Since none of the above is the actual state of affairs, who knows?

Thu, 09/02/2010 - 13:33 | 559978 uno
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I think it may be another BIS swap with unallocated gold from western banks and also the IMF dumping.  Good to see the warning being broadcast.

Thu, 09/02/2010 - 14:13 | 560069 Caviar Emptor
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Hehe. And these rumors have been circulated every couple of months since 2007. Every time that has only resulted in huge central bank Buying by central banks from developing economies. China and India made huge purchases (and have already profited hugely). Middle East countries are trading in their ocean of paper dollars for gold (and noe have gold ATMs !). Indonesia, Sri Lanka, Mauritius, Malaysia etc etc etc the list is long. 

Meanwhile individuals in Asian countries are officially encouraged to buy physical gold (China). In Asian cultures ownership of gold is considered divine. That won't stop any time soon as gold becomes dearer. And then we have the problem of peak gold production. For over a decade, gold production has failed to increase despite mega price appreciation. Figure it out.

Thu, 09/02/2010 - 13:03 | 559915 prophet
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TPTB know the smart money will only force the issues so far, as they know its in their best interest to keep the whole thing from collapsing.

Thu, 09/02/2010 - 13:08 | 559921 prophet
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<<'500 error double posted>>

Thu, 09/02/2010 - 13:14 | 559933 Hunch Trader
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So we're living in the age of hoarding. Hoard food, gold, oil.

Cavemen are back.

 

Thu, 09/02/2010 - 13:25 | 559962 anony
Thu, 09/02/2010 - 14:59 | 560239 doolittlegeorge
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this is no ordinary form of hoarding IF it is occurring.  We know Santelli said the "H" word relative to treasuries.  Other than that "we know nothing."  If the "H" word is spreading then obviously that is not you or me.  That would be institutions and most importantly government itself.  There is no clearer definition of "policy failure" than that the government itself feels a need to "hoard" things.  Should the United States ITSELF decide to hoard (aka PROTECTIONISM as mentioned above) you really, Really, REALLY have a problem.  We do know "industrials have REALLY perked up."  That's a Depression era signal...argumentatively I would agree with that.  Of course "how many lawyers are there on the floor of the NYSE"?  The word "zero" comes to mind.

Thu, 09/02/2010 - 13:23 | 559955 MachoMan
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The uncertainty is what keeps everything from shooting to the moon, but also from falling to hell.  The uncertainty is what keeps us range bound.  As soon as we take some of the cogs out of the wheel of uncertainty, everyone piles onto one side of the island and it tips over.  The uncertainty is necessary to perpetuate the status quo and the uncertainty will be defended at all costs.  Some people may think they know about the extent of gold in fort knox, fed actions with foreign governments or future QEasing, or intervention/suppression of the PM markets, but they do not have confirmation of this extent.  This is why you have mixed signals...  e.g. crazy up days on no good news, selling of IMF gold, threat of QE, etc.

Expect more uncertainty.

Thu, 09/02/2010 - 13:24 | 559958 anony
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Sports guy chest bump.

Thu, 09/02/2010 - 13:26 | 559961 Theta_Burn
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Sorry for the off topic

Another fucking rig explosion

http://www.msnbc.msn.com/id/38973757/ns/us_news-life/

Thu, 09/02/2010 - 13:31 | 559974 zaknick
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Very nice.

 

I was unaware of this:

 

"It was the rampant commodity inflation, trucker strikes and food riots that played a key role in ending the game in 2008.  This is because it forced the emerging markets to raise rates and cool growth as the Western world imploded under a pile of debt."

 

Is this correct?

Thu, 09/02/2010 - 14:16 | 560080 Caviar Emptor
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Yes. It's all there for the reading. Food riots spooked markets. The worst was in the Philippines and Thailand. Rice is a sensitive subject throughout Asia. 

Thu, 09/02/2010 - 15:03 | 560254 doolittlegeorge
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there were no trucker strikes, no.  There was a "drive by" around the beltway but believe you/me there was no trucker strike.  There COULD be a trucker strike because THERE IS NO TRUCKING INDUSTRY right now.  Interestingly "sign on bonus' are soaring."  And needless to say "food riots" are complete falacy insofar as "mom and Apple Pie" land are concerned.  There were some issues in India as I recall....

Thu, 09/02/2010 - 15:35 | 560358 Caviar Emptor
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Even Wallmart's food prices surged last month. Survey of a basket of their items showed higher prices and no rollbacks.

Apple pie won't taste too nice if it craters a weekly family budget: check wheat prices? Sugar?  Corn challenging all time highs. 

Food inflation is only resuming its uptrend. Dollar policy over the last 30 years is coming back to haunt.

Thu, 09/02/2010 - 13:33 | 559981 SheepDog-One
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Its all imaginary, based upon FED buying the govt debt and stocks too, so how anyone can extrapolate out from that BS is beyond me!
Retail is gone, markets or dead so all you can glean from 'markets activity' is the FED is playing with itself in the corner.

Thu, 09/02/2010 - 15:05 | 560259 doolittlegeorge
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banks, banking, banksters, bankorama, bankerball, bank-wanky, burbanky.  call it what you will--"The Song Remains the Same."

Thu, 09/02/2010 - 13:33 | 559982 99er
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Bank Runs? Let's look at Afghanistan....

Kabul Bank

http://www.msnbc.msn.com/id/38949045/ns/world_news-south_and_central_asia/

Thu, 09/02/2010 - 15:06 | 560263 doolittlegeorge
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they got dollars in that bank?  I'm making the call right now....

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