The Big Lie
A central tenet of propaganda is that the Big Lie repeated often enough is accepted with greater ease than small lies. Thus it is no surprise that the leadership and propaganda organs of the Fed, Federal government and the Keynesian cargo Cult of fellow travelers all repeat our era's Big Lie: There is a free lunch after all. There are two free lunches, according to our financial and political leaders: free money, in the form of money created out of thin air by the Fed, and almost-free money borrowed into existence by the Federal government. The problem with Big Lies is reality has not been disappeared; it still exists. Actions create consequences, and not necessarily the consequences that were planned or expected.
Fingers of Instability
Every time real personal income goes negative, a recession occurs. Now that personal income is falling, a recession is baked in. The Big Lie of the "recovery" is that it is self-sustaining. Minus government transfers, the reality that the Fed and Federal government are simply enriching the top 1/10th of 1% with access to unlimited credit at zero interest is revealed.
We all know that double digit inflation in HPA is not a good thing for the long term recovery of the housing market.
Biderman's back and belligerent as ever. The TrimTabs CEO is perplexed at Krugman's (empirically) flawed assumptions that the US government can manage the US economy (better than a free market), destroys Krugman's cornerstone argument that the deficit is reducing to sustainable levels (thanks only to a big jump in taxes and not growth), and suggest he win an award for perpetuating "The Big Lie" that deficits don't matter because 'we owe it to ourselves'. The bottom line is thanks to simple supply and demand, the Fed is blowing a huge bubble in stocks "that will explode," since the typical growth in incomes is not there. Biderman wholeheartedly agrees with David Stockman and goes on to warn of the "Ides of April" as, while many proclaim the calendar as indicative of it being a great month; in bull runs, he notes, taxpayers are 'trained' to sell at the last moment and with tax-day arriving soon, he expects this week to remain bid (on quarterly flows) and next week to be trouble (as taxes weigh).
The sequestration bullshit is driving TrimTabs' CEO Charles Biderman nuts - and rightly so. As we showed recently, the actual scale of the earth-shattering cuts, while not insignificant, are small and if the shills on TV preaching the end of the world from sequestration did the math they would see it is a mere 6% drop in non-entitlement government spending that is set to destroy the economy. Biderman exclaims, "what is apparent to me is that our government is becoming very good at the big lie," as they exaggerate any and everything to their own needs. It is obvious, he adds, "that our government is deeply committed to not reducing the size of government, and is willing to outright lie," but he saves the epic rant that we come to expect for Paul Krugman. Just as Irving Fisher's infamous 1929 pre-crash call that equities have reached a permanently high plateau; Biderman suggests Krugman will be remembered as erroneously claiming that 'deficits don't matter', as he reminds us of Emperor Caracella's 268AD reign of insidious taxation and currency debasement that ended in 1000% inflation and the end of the Roman Empire. Well worth the price of admission...
The big story this past week, besides the annual State of the Delusion speech by Barack “It won’t add a cent to the deficit” Obama, was the fate of the passengers on the Carnival Triumph as their skyscraper sized ship was left adrift at sea for days without power. The ordeal at sea of the Carnival Triumph and the leadership displayed by the Carnival management and executive officers is a microcosm of our declining empire. Rather than deal with our reality, Obama chose the Carnival Cruise Line method of public relations - misinformation, denial and delusion. He has embraced the Big Lie concept as if he had created it. Our cruise of illusions and delusions is headed for troubled water. The math challenged citizens on this ship have been enjoying the 24 hour pizza buffet without the labor required to pay for the bounty. This voyage is reaching an end and the bill is coming due. The engine is on fire but the captain is telling us all is well. Eventually, everyone will know the captain lied.
The official lie is most effective when we want to believe the lie more than we wish to know the truth.
“Facts do not cease to exist because they are ignored.” – Aldous Huxley
The entire system is corrupt to its core. Both political parties, regulatory agencies, Wall Street, the Federal Reserve, and mainstream media are participants in this enormous fraud. They grow more desperate and bold by the day. The lies, misinformation and propaganda being spewed on a daily basis become more outrageous and audacious. They are using the Big Lie method on a grand scale. They frantically need to lure the muppets into the stock market and the housing market to keep the game going a little longer. You can sense we are reaching a tipping point. The system they have created is mathematically unsustainable. Therefore, it will not be sustained.
One cannot see clearly while in the midst of the madness using only the cognitive tools and worldview assumptions supported and promoted by the madness.
We find ourselves more amazed than ever at the ability of those in power to lie, misinform and obfuscate the truth, while millions of Americans willfully choose to be ignorant of the truth and yearn to be misled. It’s a match made in heaven. Acknowledging the truth of our society’s descent from a country of hard working, self-reliant, charitable, civic minded citizens into the abyss of entitled, dependent, greedy, materialistic consumers is unacceptable to the slave owners and the slaves. We can’t handle the truth because that would require critical thought, hard choices, sacrifice, and dealing with the reality of an unsustainable economic and societal model. It’s much easier to believe the big lies that allow us to sleep at night. The concept of lying to the masses and using propaganda techniques to manipulate and form public opinion really took hold in the 1920s and have been perfected by the powerful ruling elite that control the reins of finance, government and mass media. How many Americans are awake enough to handle the truth? Abraham Lincoln once said that he believed in the people and that if you told them the truth and gave them the cold hard facts they would meet any crisis. That may have been true in 1860, but not today.
The reality is that we’re now facing a Crisis that will make 2008 look like a picnic. That Crisis will come when sovereign nations begin defaulting. The most likely candidate is Spain who refuses to ask for a bailout because it doesn’t want anyone looking too closely at its books because the entire Spanish baking system is insolvent beyond belief.
What do we call a power center that enables and enforces neofeudal exploitation and predation? We call it evil. The Federal Reserve is a force of evil that should be abolished at once. Its purpose - enabling and enforcing a neofeudal transfer of wealth from the productive many to the unproductive, parasitic few - is evil. Those within it are serving evil. Those who defend it are serving evil. Those who worship its power are serving evil. Those who mask its true nature are also serving evil. In a society and culture that has lost its moral compass, a culture of greed, self-serving lies and corrupt vested interests, the word "evil" has lost its power. It has been reduced to a cartoonish label, a cynic's smarmy joke.
Human nature hasn’t changed in centuries. We have faith that humanity has progressed, but the facts prove otherwise. We are a species susceptible to the passions of power, greed, delusion, and an inflated sense of our own intellectual superiority. And we still like to kill each other in the name of country and honor. There is nothing progressive about crashing the worldwide economic system and invading countries for “our” oil. History has taught that there will forever be manias, bubbles and the subsequent busts, but how those in power deal with these episodes has been and will be the determining factor in the future of our economic system and country. Humanity is deeply flawed; the average human life is around 80 years; men of stature, wealth, over-confidence in their superior intellect, and egotistical desire to leave their mark on history, always rise to power in government and the business world; this is why history follows a cyclical path and the myth of human progress is just a fallacy.