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The Economy is Busted and Stocks Are In a Bubble. End of Story.
This is getting old.
We continue to be told that the US economy is in recovery and stronger than ever. The press trumpets heavily massaged data (GDP growth and the unemployment number) while ignoring data that clearly indicates the US economy is in the toilet (labor participation rate, median income, etc).
Do the following sound like a strong economy?
1) The labor participation rate is at a 36 year low meaning there are less Americans of working age actually working than at any point in over three decades.
2) Median income is down over $4K since 2008. You cannot use mean income to measure income because the wealth disparity in the US skews the results courtesy of the 0.01% who earn millions per year.
3) An incredible 47% of US households receive some form of social spending from the US Government.
4) One in five US households are on food stamps.
Keep these in mind whenever you hear that the economy is in recovery or stronger than ever. The reality is that the Federal Government and Federal Reserve handed trillions of dollars to the big banks (most of them FOREIGN banks). Everyone else got hosed.
The end result?
Stocks have become more and more disconnected from reality to the point that we are in a massive bubble even larger than that of the housing bubble.
You cannot have a market go absolutely vertical forever. At some point this whole mess will come crashing down.
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Best Regards
Graham Summers
Phoenix Capital Research
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"This is getting old."
Indeed it is.
Yes. It is gettin old. Still not getting it that the economy with all its manipulated data is disconnected with prices across markets (bonds, equities, etc). It is the aggregate debt and further creation that shuffle around these markets.
Price discovery will never be restored until the Predators call it off. That this is end game now is a dream...there are still juices left with retard preys asking for it.
Grammar Police Notice!
This is a warning, next time there will be a fine. Review usage: Less vs Fewer.
carry on.
Nothing is busted until they say it is busted...got it??!!
This guy stinks...though eventually he will be right.
Here is my prediction Graham:
We will all die someday!
I am a PROPHET just like you!
Interesting point about the skew of the mean.
Wonder what would be the mean if capped income at say 200k - for purpose of analysis that is
I had a part time job delivering pizzas when I went to both college and grad school...not sure why going to college now = unemployable. More likly that job prospects suck all around so going to school allows a young adult to delay that reality in a respectable manner (by accumulating thousands in debt). The jobs aren't coming back at any level except in small short term pockets...
Of course, "mean" means AVERAGE income which most dumbarse Americans have no idea how it differs from "median" and that's the way the propaganda machine designed it.
Agree on b, c and d, but about a)... could we please look at prime age workers participation rate as the go to statistic? It is still bad when it comes to numbers, but at least it would be more meaningful (http://research.stlouisfed.org/fred2/graph/?g=JUA)
Total working force participation rate was meaningful in an economy that was mostly rural or factory workers, but is bogus in the XXI century: it discounts the fact that a larger % of 18-24 being in education is just normal in a world that requires more skills for meaningful employement (and it is a good thing). The fact that education cost in the US is insane doesn't mean that people getting out of high school (and what high schools!) and looking for a job right away is a good thing per se.