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Joe Saluzzi Refuses To Drink The Economic Kool-Aid
Some more macro observations from Joe Saluzzi: Last "Friday's stock market was the biggest tell: when you saw an unemployment number come out like that, that tells you what an absolute joke the stock market is, and how it's a lagging indicator, not a leading indicator of what's going on... When you're in the basement you can't stay in the basement, you have to walk up the stairs to get out. We aren't walking up the stairs, we just stopped walking down the stairs... a $77 Estimate on the S&P, you are looking at a 15x forward multiple on that earnings, yet you are in an economy which is closer to the 80's which deserves a 10x P/E. Why do you give it a 15x P/E?... If California was a public corporation they would be the next Lehman Brothers: that's how bad this thing is. The government is saying 'We're not going to bail you out California.' We're they going to come out with the $9 billion that they owe?"
Yet nothing deters the Bloomberg Kool-Aid brigade.
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Mayhem (or any others that subscribe to non mainstream perspectives) the recently appointed Information Czar in the White House seems to have more than a minor issue with any who have views outside of the mainstream. The following is the abstract of a paper he co-authored in January of '08 (the link that follows will allow you to download the entire paper)
Conspiracy Theories
Cass R. Sunstein Harvard University -
Harvard Law School
(White House Administrator of the Office of Information and Regulatory Affairs)
Abstract:
*(other examples could include those who believe the Fed manipulates markets along with Goldman Sachs, Central Banks manipulate Gold prices, Tim Geithner gave preferential treatment to the banks, Capital One has not counted Chapter 7 filers, Media Kool-Aid conspiracies etc.)
Download
The Office of Information and Regulatory Affairs.
Says it all right there.
Orwell called it, "The Ministry of Truth".
Yeah. Let's go with that. It has fewer letters, is easier to say and understand and doesn't undermine my cognitive epistemology.
:/
Conspiracy theories flurish when governments lose credibility with their populations, plain and simple.
When the population perceives government information as obviously truth lacking propaganda, the public then compensates by picking what facts they can glean from media organs of the state. The public then organizes what facts they can assemble along with the population's experience in reality to arrive at a plausible theory of what is in fact going on. Conspiracy theories are an outcome of a government's loss of credibility.
When larger percentages of the population begin to give weight to the views they have assembled as opposed to the party line propaganda espoused by a government and the elites who own the government, the power structure responds by dismissing the public's view as CRAZY TALK.
As ZH et al can tell you, first they ignore you, then they ridducle you, then they attack you. That comes from some old guy way smarter than me...
You missed the last part i.e. "then you win".
+1
The only people that believe "official reports" anymore are the kool-aid drinkers and the ones stirring it. This is a fight to the finish between this historical chapter's psychopaths and truthseekers. Same game as always; it's the surprises that keep it interesting; to see where the good and bad players come from.
Yeah. You forgot step four.
Step 3 "then they attack you"
Step 4 "then we revolt"
I know it's fashionable to dismiss "It's different this time"...
So true- right now blogs like ZH are a minor nuisance to those running the game. Best approach for now is to ignore them, because they have a limited audience.
To me, the signal that ZH and others are starting to really have an effect will be when CNN, NPR, ABC/CBS/NBC, NYT etc., start the barrage of 'investigative' hit pieces. Based on observations of how the machine has worked in the past, the attack will come on many levels:
(1) ridicule - select a few of the more far-out comment posts and imply that they are representative. Better yet, plant a few anonymous posters to make intentionally bizarre posts and use those. Take shots at the blogs on the Daily Show and Saturday Night Live. Release a few movies or TV episodes for popular shows which portray those who frequent 'subversive' blogs as losers / idiots / dangerous.
(2) attack on integrity - imply that such sites are being funded by political/evil/terrorist entities/foreign countries with nefarious subversive goals. Select one particular post on a blog and (rightly or wrongly) show in detail how it is incorrect. Then imply that all other posts on that blog are similarly bogus.
(3) fear - start issuing subpoenas for website IP logs etc. based on threats to national security or whatever. Imply that bloggers and their readers are under investigation. A few high-profile trials would work wonders in keeping people away.
(4) censorship - hard to do now, but not impossible (see China). There have been a number of reports on NPR and elsewhere describing how easily terrorists like the crotch-bomber can access information on the internets. Really we need to shut those sites down. Quickly becomes a slippery slope from there.
Well, the real conspiracy is that there is any rule of law in America anymore. The real conspiracy is that Iraq has (or had) WMD's. The real conspiracy is that America is embroiled in wars all over the world to - what was that again? - "promote freedom and democracy" (LMAO on this one - everytime). The real conspiracy is that we have free and fair markets. The real conspiracy is that there are two parties in America. The real conspiracy is that the President is elected by the people. The real conspiracy is that the US Govt. is of, by and for the people. The real conspiracy is that American soldiers lay down their lives everyday to "protect America".
First goddamn PROVE to me that these are all NOT conspiracies, then we'll talk about whether the ones you mention (which is the truth BTW) i.e. whether "the Fed manipulates markets along with Goldman Sachs, Central Banks manipulate Gold prices, Tim Geithner gave preferential treatment to the banks, Capital One has not counted Chapter 7 filers, Media Kool-Aid" are conspiracies or not.
Mr. Cass Sunstein - the puppet that he is - wouldn't know the first thing about "conspiracies", IMAO. What an asshole.
Thanks for flushing that Kool-Aid right down the toilet, Mr. G.G.!
Truly, anyone paying attention has to realize that legal jurisprudence has been radically restructured over the past three decades, making it possible to arrest and incarcerate any citizen for anything, and legalizing what was once fraud for all those plutocrats.
Wonder if Bradley Birkenfeld is now a conspiracy true believer??????
Well said Gekko. I like the cut of your jib.
Such theories typically spread as a result of identifiable cognitive blunders......cognitive blunders such as "following the money".
I'm so glad we have an Office of Information and Regulatory Affairs (paid with tax dollars), while not a single person has
gone to jail for the looting of the Treasury.
Apparently the strategy is going to be "The Treasury was not looted...there is no increase in the debt....you are experiencing a cognitive blunder....these are not the droids you are looking for".
Where are my flowers and chocolate?
1984's Ministry of Information and Napolitano's
smears on returning vets. Pay no attention to
the men behind the grassy knoll...
That part about the Bush conspiracy on 9/11 is downright silly.
A simple pattern analyses of the financial data surrounding the events of 9/11/01, plus the data comm and EFT transmissions originating from inside the two WTC towers during the preceding 18 hours, plus the bios of the pax aboard those four airliners (with any homicide investigations, proper procedure is to always investigate the victims' backgrounds) yields the following involved parties: Blackstone Group, Veritas Capital and A.I.G. (subsidiaries: Marsh & McLennan, I.L.F.C.) along with the office of the SecDef and VP, utilizing cutouts from al Qaeda.
Really quite simple.......
Oh my god. Why the F%@k do "reporters" always resort to the "aren't we better off" than last year argument. Their defense of the economy is laughable.
+1
These reporters sound like apologists for the apparent disconnect between the street and the rest of the economy.
They tell us they see the light at the of the tunnel, but they forgot to say it is a next train.
tom boy frank
Bloomberg's Carol Massar belongs at CNBC (as does their morning person Betty Liu)
You are right anony... more worthless corporate media whores espousing the party line, CCCP circa 1973.
thats how bad this thing is - california is lehman brothers LOL
....and the placement agent junk peddlers to CalPers be livin' large.
http://www.sacbee.com/topstories/story/2463467.html
Yea... okay, California is going through rough stretch right now. But... we are about to legalize marijuana. California may soon plunge into chaos and anarchy, but thankfully we'll be too stoned to care.
Soma, soma, soma....
Good stuff. Kool Aid to stop being poured beginning the end of this quarter...
Kool-Aid is All Amerikan:
Ingredients: Artificial color, artificial flavor, preservatives, New Jersey chemical industry approved and a cool cartoon package for the illiterate public to find it in the store.
+1
Fricking awesome.
The best part of that exchange came when "Matt" at B'berg tried to opine that since we've come offf the bottom since March it deserved a 15.
MS
The funny thing about those bullish mantras is they're based on the assumption that this time is going to be about the same as previous times. The stock market's anticipating recovery, ya see?
Six months is the usual timeframe. Third quarter GDP co-operated, but only because of your friendly remote government. As a macro matter, fourth-quarter GDP had better co-operate fully.
Come to think of it, playing the odds also indicates expecting a correction that would bring prices more in line with earnings. Just sayin'.
I think it's even simpler than that.
The bullish argument is based on the assumption that low short rates and a steep yield curve will translate into a better economy down the road-- and a higher stock market leads the real recovery.
Just like it always does.
We are intentionally being led down this road-- and we should all know by now that it's the wrong road. Interestingly enough, most investors understand this, as they haven't been the incremental buyers of equities. Most of us have reviewed the history of debt driven contractions... and it just doesn't end as neat and pretty as we are currently being led to believe.
At some point, the goverment just wont be able prop this illusion anymore. Just don't be surprised, though, they will use more tools in the shed to keep the market propped up.
They will hire for the census and call that a job boom...they drink kool aid and talk mud pies......
What's to stop them from just "calling" a job boom without even hiring anybody? Passing hot air as "data" is closer to how the US Govt. operates.
Joe is cool, but does he look like Bob Saget, or what?
Right on Joe! Tell it like it is!
Huge gap between Wall and Main Streets.
The markets are indeed lagging indicators. As Joe says, "go out and talk to the real people who have been unemployed for 27 months. How are they living?"
Meanwhile the talking heads just keep talking. How much for the blond?
Camping sites are full from California to Florida ..... just saying
Intel and Microsoft are going to report ungodly unbelievable earnings. So unbelievable it will in fact be unbelievable.
http://www.youtube.com/watch?v=waacof2saZw
Well, we all know how "accounting" is done in America, don't we? I don't believe ANY financial data provided by ANY American company anymore, which is why I have stopped buying stocks (except Gold mining - even with those I am losing patience). In fact, I have stopped trading stocks altogether just on principle. Fuck stocks and fuck you NYSE/all stock exchanges in the world.
Very important and perceptive point, GG. You are not alone. Most Americans have already abandoned the stock market, which is why there has been no volume to the rally at all from day one. Like you, I do not feel I can rely on any numbers and since I am not a gambler, I can't invest if I don't trust the numbers. SO I sit in cash, thinking about farmland and having fun. Most of all, I hope that by pulling my equity I have in some small way made it harder for some snot-nosed fudgepacker on Wall Street to do his thing.
I'll come back after P3 is done. Until then, Wall Street can go fuck itself.
Just make sure you have the right kind of cash i.e. Gold/Silver, and not FRN's a.k.a. dollars/any kind of paper money.
Agree 100% - if they can't use GAAP mark-to-market economics then they can't be trusted with my money. I'm not buying equities at all.
Current position: 65% cash (FRNS), 35% in the SH ETF.
I'm considering moving half of the cash to silver. It seems inevitable that we'll have to return to honest money.
My limited but serious advice: grain and copper futures.
There is one and only one institution responsible for ALL these problems:
The Federal Reserve
The name really means NOTHING. A more appropriate title would be "The Most Powerful Private Bank in the World" (as J.S.Kim would say). Buy Gold and Silver and REJECT Federal Reserve Notes (or at least don't use them more than you really have to) - the simplest and most powerful way to kill the beast.
The blonde cracks me up. Every time she has Joe on she pleads with him to agree with her that 'things are getting better, don't you agree?'. As if that will make it all go away ....
How do analysts come to $77 earnings? To justify stock rally, the next year's earnings need to be 15 times.
So very simple formula -> take the number S&P is trading at and divide it by 15. Bingo we have next years earnings. It doesn't matter if it is 36% growth from last year.
Watch this video and it is so obvious why traditional media continues to implode. It amazes me that the solution is so simple (tell the truth) and yet they fail to do it. The two bubbleheads will soon be unemployed. Then they'll understand what those of us west of the Hudson River all know intuitively, because we're living it.
Matt Miller is no Brian Sullivan (not even close). When Sullivan left Bloomberg, it went straight downhill. Only things good on BBerg now: Pimm Fox, Charlie Rose & obviously the great Tom Keene
Save this video for next year. We can all watch it again and laugh at the two Bloomberg clowns.
Nobel Prize for JS for calling it straight versus
the Orphan Annie Tomorrow Chorus.
Unemployed voters do not invest or vote
incumbents. Watch the Brown vote in Mass
Tuesday.
Census Household numbers for December 2009
employment over -500,000...
S&P prices versus reported earnings over 83x.
BB Gilligan RahmB0 Feds already told
Schwarzenegger to take a hike back to
Terminator V. Ari may get him the part.
If EBay Meg Whitman wins CA guv,
they'll start cutting and she'll wear armour.
Never let facts get in the way of ebullience:
Big4 short S&P 400, 500, 600.
It's the jobs, bailouts, bonuses and hidden taxes...
http://www.jubileeprosperity.com/
Does anyone have the link to the WSJ article where Saluzzi references the Fed's leverage ratio??
so the stock market is a lagging indicator, huh. great ass-backwards insight.
by the way: how did that stinky APU purchase up at 42.9x work out? oh, it didn't? just like the comment above sounds cute and is a total fail if actually graded for quality of. pure genius.
but then again, what the hell do i know, i'm just a nobody and that guy is on tv; that is, when he's not bitching about the big, bad computers who beat up his antiquated practices of preying upon those weaker than him.
as usual, who cares about accuracy and the actual bottom line when your emotional bile sounds so sexy and everyone will (incorrectly) lap it up / agree with you; just like 99.99% of everything else on that disgusting infomercial network ~ toxic slop tailor-made for retail to swallow down.