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Chart Of The Quarter: $312 Billion In Debt "Adds" Negative $5 Billion In GDP
What was it about the law of diminishing Fed stimulus returns again? But don't worry: "the market is up." Because if $165 billion in Q4 stimulus could not even generate a positive GDP return, at least it sent the Russell 2000 soaring.
Source: BEA, Treasury Direct
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More drones!
I'm not worried. Silver is up.
Diminishing returns leads to hyperinflation bitchez.
Bullish! This just means MOOOAAAR debt is needed.
Mr Scotty, I need 110% speed on the printers!!!
I'm give'n her all she's got cap'n
"Ludicrous Speed!!!"
Thanks ZH, that simple graph / picture explains everything.
All this stimulus, QE, Bailouts and still can't get this recovery going.
Current Business Layoff/Closing List
http://www.dailyjobcuts.com
/
It's just a vindication for the real world folks. We've been saying for years that MONEY and DEBT don't MATTER in a real sense. They are SYMPTOMS, not CAUSES.
What matters to whether you can drive more people more miles is that you have more energy supply. The debt is just a claim ticket.
Ben CAN'T PRINT OIL.
Look at the US's history...1970, peak oil, 1970s...collapse, inflation, malaise. 1980s we get Prudhoe, suddenly it is morning in America. Same debt arc. If we begin producing again, we'll have the good times rolling. Everything orbits around our ability to increase aggregate energy rate of production, or to decrease the decline. The debt just FOLLOWS that.
Bernank and the rest of them really ARE trying to print oil by offering credit at nearly free prices. But, those in the real world understand that there is NO AMOUNT of debt that can make a negative EROI somehow profitable in any real sense.
The Real World is for pussies.
Subtraction thru addition or is it addition thru subtraction - shit - they can't even get that right.
Acet says "Bullish! This just means MOOOAAAR debt is needed."
exactly.
but you left out the prefatory phrase the solution is as simple as it is obvious.
Dr. Krugman, Dr. Krugman, we need your help here. /sarc
Captain, the warp motors are gonna' BLOW!
but but what about Sandy? I thought natural disasters INCREASE GDP! whaaaaaa!
Krugman was on Bloomberg monday. They put mittens on top of kit gloves to make sure he was comfortable. The hosts were careful to mention his credentials and titles without placating him too much. He only had to debate one other person, who was very, very civil.
Even with all that, he only stopped squirming and used his big boy voice for about 10 seconds in the whole two hours. "You know the greatest recovery in economics was WWII. Incredibly destructive spending" smiling from ear to ear.
I have respect for those who sacrified in that war (and all wars). And I am even old enough to start forgetting the evil machinations and false flags behind it. But it would be fantastic if we had scholars incharge of fiscal policy who can reference things that have happened after the 1940s.
Since WWII was such an economic panacea according to Krugman, then why doesn't he simply advocate:
1. US, UK, France, Spain, Germany, Japan, et. al focus on rapidly expanding their navies with unprecedented building programs, kinda like during a war.
2. After building these enormous fleets, the countries can then pilot them out to some agreed upon location in the Pacific Ocean, off-load all the sailors, and then sink all the ships!
3. It'll be lots of fun. Maybe it could be made a PPV event for some extra money, and SHAZAM! All the good stuff - stimulus, economic boom, good times are here again!- with no loss of life!
We'll all be rich, I tell ya! And for the truly greedy (aren't we all?) Rinse, repeat! QD(quantitative destruction) 4eva. Utopia is so close!
I know. I know. It's not nearly as exciting as an alien invasion.
That was basically mitt romney's plan for a 200 aircraft carrier navy. That way both him and Bush Jr. could get one named after themselves, just like papa smurf!
Problem is, people actually payed taxes for that stuff. Romney don't pay taxes. He gives to charities where he is a bishop.
When the pawn hits the battle, he thinks like a king.
"with no loss of life!"
Well then I guess we'll still have structural high unemployment and awful demographics.
Nothing fixes employment-to-population like killing large numbers of people!
Alien invasion, anyone?
Even economists expect the economy to be slower in the Q1. That makes two quarters in a row of contraction (i.e. a recession).
No it does not!
PM's been looking pretty good since Monday.
http://blog.quantsig.net/2013/01/30/goldsilver-2/
This is just short term noise. The stock market has shrugged off this insignificant news and will soon be making its way to new all time highs. Professional fund managers recognize that despite this minor set-back, the long term fundamentals for the US economy are overwhelmingly positive. Here are just a few of the endless positive indicators for our economy:
When will masochistic doomer libertarians on this site recognize that they are simply wrong about economic collapse and the impending apocalypse? When will goldbugs, silverbugs and bitcoinbugs realize that their dreams of becoming kings of the universe will never materialize?
And think, a net increase in debt means there's MORE CASH ON THE SIDELINES!
Who cares about tomorrow anyway.
To me, it is not shocking that the defenders of easy money policies (i.e. the Media talking heads, politicians, corporate welfare babies, et. al.) would shrug off this particular set of facts and still defend the idea that adding debt is good for GDP growth. No matter how you slice it, the ability for any country to print their way ouf of this mess is showing itself to be a game ender.
The money faileth - Gen 47:15
Famine is coming. And you are a troll.
He's no troll, he's MDB
Embrace his insanity
Must be at least 9 other trolls to +1 the Mega Douche Bore.
MBD is the King O' Sarc here on ZH.
Not sarcasm. Parody.
There is a big difference.
:/
Not parody. Attention whoring.
There is a big difference.
BORING
Not attention whoring. Whatever the word is that means you don't agree with him, you're not sure he really means it anyway, but he's just entertaining enough you still read his stuff and get a laugh.
There is a big difference.
He stopped being funny or entertaining by his third post.
Well, humor and attention whoring in general are really in essence just ways to outshine the competition and get the attention of the members of the opposite gender of the species.
That said, proper parody can also be used to make people think. Just a way to show redutio ad absurdum without the elitistic baggage that's often associated with intellectual pursuits in some circles.
Incessant repetition is boring, not thought provoking. Comedy is an art, and when it's entirely predictable, it just isn't very funny.
I realize, however, that it's a blessing to be counted among the easily entertained.
Irony, actually.
Even if it's sarcasm, it's so predictably boring. Cut and paste away, MDeltaBravo.
Large room....small door - get familier with the phrase.
And again, how much was this freshly printed dollar buying in GDP?
How many times did you post this?
What are you smoking, dude?
Your sums miss how much debt is needed for +0.1% of GDP? imagine if these economists 8 balls told them that $1500 million million million a month would give them that would they do it?
I miss Burger King-there I could have it my way with a paper kings hat.
Show me some positive indicators that are not government manipulated propaganda.
It goes up until it doesn't. In the end it's fundamentals which are overseas at best. Keep buying - it will be a better short
Thanks for the reminder! After reconsidering the vast increase in production soon to be realized from more underappreciated printed paper (college degrees, NOT fiat money - though they are both worth about the same amount), I feel much better.
My mouth is salivating at the thought of the next technological revolution to be birthed by the next wave of social workers, teachers, minority/women studies majors... blah, blah, blah
/sarcasm off
Welcome back MDB we missed your acurate and succint analysis of the situation. We always love to have a good laugh. I will point out the markets have nothing to do with the economy anymore.
It's called 'debt saturation'. It's an Austrian thing, you wouldn't understand.
Austrian Asymptote ... Hail the Mighty S-curve all thou Mad Monetarists. Your noxious notions of negative valuation will be rejected by the very fabric of the universe.
It's like ... er ... negative Mass ... philosophically speaking ... no! ... really!
Looks good on the page, but can't be rendered in "the real world", so to speak.
Best not to poke at it, wouldn't you say? But ... Boyz will be Boyz.
TDS
more drones
more homes
more phones
more political clones
more kleptooligarchianthievingfuckers
more rope
Q4 negative GDP. Blame Sandy... Hook... Truthers.
That's not "diminishing returns". That's "vanquishing returns".
Chairman Ben, get ready for next year's Nobel Prize in Economics!
Some old quote about needing a bigger boat comes to mind...
Not the size of the boat, it's the size of the holes in the boat. Credit isn't happening as all money is given to banks to secure fraudulent CDS which in turn is dumped in stock market. This will not create jobs until the big holes (CDS) are patched, and that is an economic collapse from now. When the bow is in the air, it may be time to jump ship.
I take it that means to somehow stay away from the stern? Recommendations?
"Some old quote about needing a bigger boat comes to mind... " Yeah, that's Roy Scheider in Jaws.
I was thinking more along the lines of a quote from The Titanic. "She is made of iron, sir. I assure you, she can and will sink. The pumps only buy you time, nothing more."
Bernanke2 isn't priinting enough.
I'm bullish for bullshit
never short the shit...
There is clearly overcapacity in that market, however margins seem to be holding strong, so until they break, I guess we stay long.
I'm cuckoo for Cocoa Puffs, cuckoo for Cocoa Puffs!
SSSSHHHH!!!!! They are going to talk about the blackberry soon.
BB 10 looks like every other phone out there-unless it can give me a blow job I don't care
what's a blackberry?
In a few quarters, that'll look like a good quarter.
Who authorized this statement? Retract and spin immediately.
How would the graph look like if you add the billions lost due to reduced govt spending?
Everything was going good until { insert weather event here }
The little engine that couldn't...
$312bn from a helicopter would have done much better. But how would that help banks and banksters line their pockets?
that's the hyperinflation moment... if it ever happens. As it stands now, huge quantities of "money" are providing an illusion of something other than a complete freefall. It's kind of creating a market for some houses, it's proping up the stock market and it's the market for treasuries and other worthless crap. This will all end... badly.
I'm bullish food stamps and Newport cigarettes. Bet on Obama's youth.
that's racist-black guys smoke Kools
Kools?!?! What cardboard Obamaville have you been hanging around at?
The magic of debt as money, interest compounding, usury and debt for consumption....the very foundation of the mathematically flawed system they fight like the Taliban to preserve.
Nothing will change, nothing will get addressed. They do not even understand the problem.
Game Set Match
what you say is spot on minus "they do not even understand the problem". These are not dumb people. These people are sociopaths. Our eventual misery is not a problem to them. Collectively, normal people have a huge blindspot with respect to the sociopaths who run the world. We project our code of decency onto them... expect that they serve in our interest... assume that assigning horrible motives to their actions is hyperbole or conspiracy theory. This is a mistake.
I learned a new word on ZH yesterday: KAKISTOCRACY.
Added.
"The market" is getting crushed on this GDP news. Dow futures are down 16 now! I don't remember the last time it was this bad.
green by close
green by open.
fixed it.
"the negative print in the 4th qtr proves the fed was right to be doing what it has been doing" Jim Cramer
I'm ot usually a violent person, but I sure would like to kick that guy in the nuts.
+1 lol
Cramer is king of double speak:
Jim Cramer on October 10 (lightning round): "There are issues involved in these mortgage REITs. They might not do as well in this environment. The dividend could go down a little bit. But you stick with these kinds of stocks through thick and thin. I'm not backing away from it."
AGNC Price: $33
Jim Cramer on January 15 (lightning round): ""I used to fight this tooth and nail, because the dividend was a red flag. I now believe it can handle this yield. The dividend might not always stay this high, but I would buy it."
AGNC Price: $31
The very fact that that guy is even on the air kills me, especially after the Bear Stearns fiasco. Even after that and all of his missed calls I still know people who follow him faithfully. The stupidity of the sheep never ceases to amaze me.
When one is (trapped) in a cult one must never question the cult leaders.
<Especially those who foam at the mouth.>
Cramer gets the boot this year.
His smirkiness behind these statements means he truly enjoys mindscrewing the public. He enjoys it a little too much. Guys like him always need the satisfaction of their victims knowing who assaulted them. He is going to slip.
Don't worry they will replace him with another douchebag.
Lol, I love that his basic premise is conviction in his opinions!
In all seriousness, the egregiousness of Cramers act is up there with cash4gold
Same here Dr., I happen to be sitting 15ft. away from a trader that nearly bankrupt a then small firm buying Bear before it shot down to 2$
My Dad still bitches that he listened to Cramer and sold Linkedin at $105
I asked my Dad what linked does and he was not sure.
Haha, that was literally laugh out loud funny! Do you also manage money for him fonz?
Nah he is retired and is the one that got me into this racket.
Whiteshadow you ever think of this run up as some slow motion kind of crack up boom for anyone left who actually has two nickels to rub together?
All the time fonz, but at the end of the day it just seems so counter-intuitive, the Fed has gotten so good at smoothing out its rigging and they are so close to sucking retail back in they can taste it. Why throw it all away on another "crash"? What would it accomplish? I know the market is always set up to inflict as much pain on as many participants as possible but the name of the game is melt up with mild orchestrated volatility from time to time. Plenty of money to be made from all the people trying to fight it.
PS- i posted again on yesterdays discussion thread earlier
Okay, I saw what you posted last night but I did not see anything else. I gotta head out for a bit will check again later.
No worries bro, wouldnt it be nice if the great MMT experiment did work out afterall, that way we could all just go on welfare and wouldnt have to let "work" and "duties" get in the way of hanging here all day!
http://www.zerohedge.com/contributed/2013-01-28/leaked-mario-draghi-and-...
"I see nothing, I know nothing." - Sergeant Schultz
Hey CD when is the second part of your post hitting the Hedge?
I'm doing the final read thru now so it should be in the next day or two. Chapter Two has gone long, but there is no natural break where I can separate it out into Chapters Two and Three without losing continuity.
So damn the torpedoes full speed ahead.
Looking forward to it.
Now that dumb ass cramer is trying to blame Sandy on the GDP print. What a brain dead moron.
Gold and Silver is getting a morning rise out of it.
Morning wood. Good to see that the PMs still want to play around a little. :)
Obviously not printing enough Mr. Bernanke. Take a look at Japan's Abe. He can teach you a thing or two how it's really done.
Don't worry, we just gave $155 million in "humanitarian aid" to Syria yesterday.
Well buy up a ton of guns and grenades to give to the insurgency and BOOM! GDP beat in no time!
Firearms stocks!
assad don't give a shit-he just knocked up his decent-looking old lady
Velocity of all that money must be near zero.
Shhhhhhh. Don't tell that to douchebag extraordinare Paul Krugman.
Don't look now, but he's currently live on The Washington Journal on C-SPAN continuing to spew his BS.
Yeah but just think how bad it would have been if they hadn't spent all that money. Just ask Krugman he will tell you.
HAHAHAHAHAHAHAHA!!!!!!
Who's dumping their UST's with with GDP print? Retracing its gains.
They are printing enough money to buy the worlds entire above ground silver supply every 10 days!
Got Silver??
Holy fuck...futures are red.
Quick, someone throw a middle class fucking taxpayer into a fucking wall and get this piece of shit fucking market up.
they've got 11 minutes to ramp things up. Plenty of time. Anyone for coffee?
Q4 US GDP added.
EQUILIBRIUM
what a nice word..:)
So this is what passing the Event Horizon looks like.
So much for that "Government Spending Multiplier" crap they keep citing. F'in morons. At this rate we'll hit China in no time.
George Carlin talking about drugs.."wonderful when you try them first...as you increase and keep using what ever it is...the pleasure part decreases and the pain part (the price you pay) increases until the balance is completely the other way and it's almost all pain and there's hardly any pleasure."
http://www.youtube.com/watch?v=eEh16ae_pCw
law of non-proportional returns, kinda sorta
Not that I know about it!
Bubble Bernanke and the Federal Reserve's secret financial plan....
Zimbabwe!!!
The Federal Reserve cannot exit, the talk is all BS.
A currency crisis is straight ahead. The Federal Reserve is headed full steam ahead to a US dollar collapse.
We crossed the point of macroeconomic debt saturation some time ago. Look up "Chart of the Century." In real terms, new debt created now subtracts from GDP.
Hence, organic growth is dead.
At this point we are truly in the Bugs Bunny moment where we have gone off the cliff but haven't yet fallen because we haven't looked down.
On a similar note, heard a radio piece this morning about Credit Unions pushing people to save, systems being overhauled to removed disincentives for savings, etc. All I could think is how all these actions are deflationary. Funny.
On a completely different note, heard that BP was charged with manslaughter and lying to Congress among other charges and has to pay a fine. How the fuck did we come to this place where corporations are "people" but there is no prison time? Maybe we all need to form trusts, and have ZH create a parent corporation. All of our trusts can buy into the parent corporation and from there we can rain hell? Is that how it is done? Maybe this is how communities should proceed. And blocks of smalle privately owned companies. WTF.
We'll see. I thought this was the case in 2008.
And all those idiots on CNBS are reminding me of what the guy that fell off the Empire State Building said as he passed the 50th floor. "I'm O.K. so far".
MDB is Ben. Welcome Ben, now start printing !
Listen boys and girls.
You were told last week from Davos, the fine upstanding members of the worlds most acclaimed show-runners, inbetween child molesting and child sacrifice that you dont know what you are talking about.
The King of the Overlords "Dimon" explained in plain English for you that "Banking is like a jet engine, its too complicated for the average grunt, sorry bloke to get his head around".
How more plain do we bitchez need to be told to mind your manners and continue to service their pernicious needs?
Get back on your hamster wheel kids and make sure Dimons bonus this year is more than last year.
What do you epect if the billions go towards imports and wars in foreign countries.
As the US dollar collaspes and the Federal Reserve continues to print like madmen the commodities are going to the unreal numbers because it will be where all the money moves.
But, but the drop in GDP would have been way worse, had the $312BN not been there, right?
GOLD bitchez! We will torch blow gold at 2:15pm, when we tell the market we discussed the exit strategy for when unemployment (as defined by us) hits 7%.... Be ready for that algo move that takes you back where you belong!
You have no way out. You shall accept all the fiat money we print!
Wait until the red bar is longer than the blue [in absolute terms]
GDP has never been a true economic indicator, it's just anothe government construct to fool the simple.
Nigga what?
but just imagine how horrible our lives would have been if they DIDN'T increase the debt that much. the horror, the horrrrrrrror. they SAVED us from certain annihilation. we owe our lives to geitner, et al.
Oops.
Markets are already green. Wish the 1Q 2013 GDP would come in at -5.0%
WTF? Gold just went verticle...
We need an intelligent person in the oval office. What is George W. doing nowadays?
Bush? Dying painfully,Hopefully!
Both the Chicago Fed reports and ISM Mfg all pointed to this.
See MacroEconomy Report Link
www.CommitmentsOfTraders.com
Both the Chicago Fed reports and ISM Mfg all pointed to this.
See MacroEconomy Report Link
www.CommitmentsOfTraders.com
So now you are Keynesian?
Did Keynesian logic lead you to that conclusion?
pdf:
http://www.nomiprins.com/storage/bailouttallyoct2011CLEAN%20NO%20FORMULA...
http://www.nomiprins.com/thoughts/2012/11/10/real-danger-of-obamacare-in...
http://www.dailykos.com/story/2009/10/14/793112/-Schumer-Leahy-Take-on-I...
http://pages.citebite.com/p8i5t8h6mphi
http://www.guardian.co.uk/commentisfree/2012/dec/05/obamacare-fowler-lob...
http://news.yahoo.com/insurers-nervous-over-prospect-romney-victory-1159...
http://michael-hudson.com/2009/02/finance-capitalism-hits-a-wall-the-oli...
The main beneficiaries of monopoly and influence will be the monopolists.
They'll never blame themselves for the cost of their folly.
Bernanke and the Fed are going to print like madmen until the trigger a US dollar collaspe and a currency crisis.
Bernanke, Evans, Dudley, Bullard and Yellen, can you say Zimbabwe?
Defense Cuts Blamed fo Economic Slowdown, so says CNN.
Uncle Sam stopped borrowing as much?
Ben loves Jamie loves Floyd loves Ben
Ain't no mountain High enough. .
Ain't no river wide enough. . .
Ain't no printer Cheap enough. . .
To keep me from printing to you
you don't have to worry
i'll be there in a hurry
What can they expect when all the money goes directly to the 1% and the 99%'ers get nada? As blatant as this has become I don't see why they just don't fire up the check printers instead and write PAY TO THE ORDER OF: Hank Paulsen, George Soros, Jamie Dimon....
OMG, could there be anything more bullish than that?
For fucking fucks sake, BUY THE FUCKING DIP!
Who cares about GDP anyway ;)
BUY Some Blackberrys ;-((((
but tbh thats quite scary, looks like all that money printing will eventually destroy the GDP as well.
and ben is like... WE DIDN'T SEE THAT COMING Q.Q
This is why long-term bonds are turning really bearish long term and the vital BLV (long-term bond ETF) / GLD ratio is turning bearish denoting relatively stronger gold. Bearing in mind that GLD is weak of late, bonds must be really weak for the ratio to be bullish for gold. The chart of the ratio (red thick line) says it all:
http://www.dowtheoryinvestment.com/2013/01/dow-theory-update-for-jan-30-...