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David Stockman: The Global Economy Has Entered The Crack-Up Phase
Submitted by Adam Taggart via Peak Prosperity,
Few people understand the global economy and its (mis)management better than David Stockman -- former director of the OMB under President Reagan, former US Representative, best-selling author of The Great Deformation, and veteran financier.
David is now loudly warning that events have entered the crack-up phase, which he predicts will be defined by the following 4 developments:
- Increasingly desperate moves by the world's central banks
- Increased market volatility and losses
- Deflation in industrial and commodity prices
- Decreasing demand due to Peak Debt
As the crack-up phase gains momentum, he predicts an increasing number of "financial breaks" that will add to the unpredictability and instability of the environment for investors. Even 'dancing close to the door' sounds excessively risky at this point.
We’re in the crack-up phase. I think there are four big characteristics of that which are going to shape the way the economy and the markets unfold as we go forward.
You’re going to see increasing desperation and extreme central bank financial repression because they have gotten themselves painted so deep into the corner that they're lost and desperate. Almost week by week, we have another central bank – this week, it was Sweden – lowering their money market rates into negative territory. The Swiss Bank is already there, the Denmark Bank is there, the ECB is there on the deposit rate, the Bank of Japan’s there. All of the central banks of the world now are desperately driving interest rates into negative territory. I believe that they’re lost; they're in a race to the bottom whether they acknowledge it or not. The central bank of China can’t sit still much longer when the reminbi has appreciated something like 30% against the Japanese yet because of the massive bubble of monetary expansion that’s being created there. So that’s the first thing going on. Central banks out of control in a race to the bottom, sliding by the seat of their pants, making up really incoherent theories as they go.
The second thing is increasing market disorder and volatility. In the last three months, the stock market has behaved like a drunken sailor. But it’s really just a bunch of robots and day traders that have traded chart points until somebody can figure out what is happening directionally in the world. It has nothing to do with information or incoming data about the real world. We have today the 10-year German bond trading at 29.5 basis points. Well, the German economy’s been reasonably strong, fueling the Chinese boom. That export boom is over. The Chinese economy is faltering. Germany is going to have its own problems. But clearly, 29 basis points on a 10-year is irrational, even in the case of Germany, to say nothing of the 160 available today on the 10-year for Spain and Italy.
Both of those countries are in deep, deep fiscal decline. There is no obvious way for them to dig out of the debt trap that they’re in. It’s going to get worse over time. There’s huge risk in those bonds, especially because there’s no guarantee that the EU will remain intact or the euro will survive. Why in the world would anybody in their right mind be owning Italian debt at 160 other than the fact that they’re front-running the massive purchases that Draghi has promised and the Germans have acquiesced to over the next year or two. But that only kicks the can down the road. One of these days, the central banks are going to falter and the market is going to reset violently to prices that reflect the true risk on all this sovereign debt and the pretty cloudy outlook that’s ahead for the world market.
We now have something like four trillion worth of sovereign debt spread over Japanese issues, the major European countries that are trading at negative yields. Obviously, that is one, irrational and second, completely unsustainable. And yet, it’s another characteristic of what I call these disorderly markets. Investment is now coming home to roost. It will be driving a huge deflation of commodity and industrial prices worldwide. You can see that in iron ore, now barely holding $60 from a peak of $200. Obviously, it’s seen in the whole oil patch. Look at the Baltic Dry Index. That is a measure, one, of faltering demand for shipments and, two, massive overbuilding of bulk carrier capacity as a result of this central bank driven boom that we’ve had in the last 10 to 20 years. So that is going to be ripping through the financial system, the global economy, in ways that we’ve never before experienced. And so therefore, in ways that are hard to predict what all, you know, the ramifications and cascading effects will be. But clearly, it’s something that we haven’t seen in modern times or ever before – the degree of over investment, excess capacity, and everything from iron ore mines to dry vault carriers, aluminum plants, steel mills, and on down the line.
And then, finally, clearly, demand has run smack up against peak debt -- I think that’s the right word for it. We had a tremendous study come out in the last week or so from McKinsey, who do a pretty good job of trying to calculate, track and total up the amount of credit outstanding, public and private, in the world. We’re now at the $200 Trillion threshold. That’s up from only about $140 Trillion at the time of the crisis. So we’ve had a $60 Trillion expansion worldwide of debt just since 2008. During that same period, though, the GDP of the world saw a little more than $15 trillion from $55 or mid-$50s, roughly, to $70 Trillion. So we’ve generated, because of central bank money printing and all of this unprecedented monetary stimulus, we’ve generated something like $60 Trillion of new debt in the world and have barely gotten $15-17 billion of new GDP for all of that effort. And I think that is a measure of why the fundamental era is changing. That the boom is over and the crackup is under way when you see that kind of minimal yield from the vast amount of new debt that has been generated.
Now I’d only wrap this up by calling attention to the fact that within that global total of $200 billion, the numbers from China are even more startling. At the time of the crisis, let’s go back to 2000, China had $2 Trillion of credit outstanding. It’s now $28 Trillion. So we’ve had just massive 14X growth in 14 years. There’s nothing like that in recorded history, nor is there any plausible reason to believe that an economy, which is basically under a command-and-control system that is run from the top down to the party cadres, could possibly create $26 Trillion in new debt in that period of time without massive inefficiencies in waste and mistakes everywhere within the systems, especially since they have no markets. They have no feedback mechanisms. It all comes cascading down from the top and everybody lies to the next party above them. And I think the system is irrationally out of control.
In any event, my point was that at the time of the 2008 crisis, China had allegedly – if you believe their numbers, which no one really should – but as reported, they had $5 Trillion worth of GDP. It’s now $10. So they’ve gained $5 Trillion of GDP. Their debt at the time of the crisis was $7 Trillion, now it’s $28. So the debt is up more than $20 Trillion while the GDP is up just $5 Trillion. These are extreme unsustainable deformations, if I can use that word, that just scream out, “Danger ahead. Mayhem has happened.” And the unwinding of this and the resolution of this is not going to be pretty.
Click the play button below to listen to Chris' interview with David Stockman (54m:29s)
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You can say what you want about the man but he knows his stuff better than most.
Yes he does.... Reading through the lines-I think he saying 6 months MAX
That's about right inho
Democratic socialism lagging communist socialism by 30 years.
Government, working 24/7 to destroy your future.
But leading the way to destroying the world's biggest fiat.
This monetary upheaveal will unfortunately be the largest spectacular failure that will cost millions of lives worldwide.
A gigantic fiat funeral pyre with the middle class in a wooden coffin on top of it.
The time to hesitate is through.
No time to wallow in the mire.
Hey Jim how about 'girl, we couldn't get much ... better', you dig?
Democratic socialism lagging communist socialism by 30 years.
They didn't know the three magic words........YES WE CAN!!!
i think we all need to shed any cog dis we have that somehow it will all be ok. stockman is hard hitting while the majority are locked in the matrix securely. by realizing we are fucked and their is hope in europe to overthrow the cartel of bankers, I remain reserved. until i see the streets of ny full like athens i am not fooling myself that there is hope. the slope of pain has the majority sliding down it like a kid on a tabogon. until some go over some bone jarring bumps and fall off, we ride to the bottom. then there is the coup de coup need to dethrone the aggression that is leading merica toward imperialistic defeat. the world will not allow us to advance much furture w/o blowback whether is be mussie attacks or putin circling custer, we are at the moment the historians will say nein more...
prepping the prep to be prepped for preparation..
Actually, Democratic Socialism is always taken over by either Fascism, Communism, or outright Dictatorship.
+100
Right now we can only lose.
He who hesitates is sometimes saved: http://jdcnow.livejournal.com/26980.html
you mean...6 months MAD MAX
John Galt. Look on the bright side.
Load up at Bartertown.....it's the last stop before you hit the gulch.
The problem is, there is no gulch. No man is an island and capable of perfect insulation. Take a portion of what you intend to put into your own safety via PMs and instead put it into your own safety via food that you give to your friends and neighbors. You're guarenteed to already be doing much better than your neighbors now, so you'll be a shining star comparitively. The shining stars are all going to need a lot of good will to avoid this turning into the French Revolution.
I'm expecting 2016 crisis so severe that cake boy Obozo can't possibly leave office and stays on
They can try to time the crisis to occur over two administrations like happened last time. Then there's somebody else to blame and it keeps the false paradigm alive.
Everybody ready for four to eight years of "It's Obama's fault?"
Exactly what Cameron's lot having been saying about Labour here in the UK re 2008. Apparently 2008 was a purely British phenomenon and since they were in power at the time, it's clearly Labour's fault. maybe you could parlay that over into US politics and claim that the the UK Labour Party also caused the shitstorm re Fannie Mae/Freddy Mac etc? Just a thought\sarc
interesting prediction
I agree
there is a game changer coming
it has been planned
Oct 2015?
If there is one thing I've learned these past 7 years, it is avoiding any prediction as to when SHTF and how abrupt or how slow that process will be. I Have some idea of of the end result, but no idea whatsoever of how long they can keep this band playing.
Had you told me in 2008 what things would be like in 2015, I'd have called you a simpleton, or worse. Yet here we are. So who's to say how long this will take to play out?
Thursday at the latest. I guarantee it.
chinese new year
Year of the sheep "BAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA"
This has stumped you and every other thinking person who follows the markets. I wonder if a Soviet style controlled collapse is in the works?
you should open eyes widers, coz the SHTF HAS OCCURED ! we are in...
it is a slooow mo situation with daily fanzy actions , gov behaviors, msm spam n scam, ordinary violence in steets etc...
the system as a whole, is like a plane who got no more engine. pilot are tightening the stick so it can plane as long as possible but we are lossing altitude my friend.
all what is surrounding you is like stuff put in front your eyes n ears to prevent seeing n earing the truth.
the day usa put a black in white house was the start of the counting. just because usa president do not control anything, but the world elite made ultimate movement consisting to show the world a posture about races and culture which they just do not respect and consider just like " i dont give a fuck about you, mass " the usa was told you can go further, bypass racial question, go together, make world better, it was a lie, and because of the lie you american believed in it, you elected him... twice...
usa population is composed with 1 hispanic, 2 blacks, 3 whites, what else as president, hitlary the fascist ? or rulio the thug of da favela_tu_madre ?
what can, obisously made after all that mess... what solution remain... seriously.... i see none.
it is a status quo between the mass and the elite, WE, the mass, accept the fate as it is presented to us.... until we do not budge, what can you expect from the world...
sonner or later mother nature will put humans back at its respective place on the timescape of the evolution, a bug.
it is very importent to people to understand that you can wake up every day with different feeling, fear, opinion, about what make the world apparently living, but, the constent, regular disorder, remain hidden in shadows and hit every one who walk too close. and some shadows are elite triggered...
stay focus, calm, low profile, but do what you have to do, keep the smile on the face, it is the 21th century voodoo believe to protect from the above.
Holy ESL. Do Asians have to scroll their screen more frequently than others to compensate for the narrow viewing window? And do they hold their phones sideways for a more full viewing experience?
Never underestimate the power money printing has to hide and distort reality and how long it can do so.
But it cannot do it forever.
And they can print a whole hell of a lot more money.... The more they do, the more we will see reality peek around the corner.
It will play out until it doesnt anymore.
I dont think the collapse will be overnight though- more like over the course of several months, much like pulling the plug on a bathtubwith a drain clogged full of hair. It wont be a slow trickle down the drain but it wont be a giant whirlpool either.
a lot of signs present
6 months from now would put us right in the middle of August. If i recall correctly the end of August through the end of September is usually the period of the year when there is a downturn in economic activity due to retailers preparing for the holiday inventory build up?
Between now and then there will be at least a couple revisions to the previous christmas season retail numbers and unemloyment rate..
arguably,the only "real money " left out there to be made is on the short side of all that debt. In fact it is not particularily unreasonable to presume that all that the last 6-7 years have been all about trying to distract people from that very fact.
What counterparty do you trust enough to make that trade?
How can any one be short that debt when the buyer can pay any price it wishes with printed money. Anyone short soveriegn debt is a fool. The buyer will be central banks who will drive downthe yield to any level it wishes to support the government.
If ypu're short you're going to get killed.
What's to stop the Fed from printing 5 trillion per year and giving it to government, GS, MS, Google, Monsanto, etc. - indefinitely?
It could, right, but it won't by design because that would delay the IMF from saving the day by doing exactly the same with a global currency, which would of course be even more harmful than the Fed doing it..
They will do that and they won't tell anyone. They are probably doing that now.
That type of secret gets out...
Fed is buying about 10b UST and 3b MBS a day, these days. If they were to step that up as you suggest, the other CBs would abandon trade with USD, as they have been preparing to do, and the local US inflation would be not only unbearable, the FRB exposed to the masses. Look what happen in Egypt when inflation on food hit 60 %.
Printing only works when the masses do not abnormally see the I'll effects.
They will push interest negative and start to seize assets in order to survive, before printing more than they are now,
Tell me what assets they can seize and from whom, that would make a meaningful dent if they are "printing" at 13 billion a day? The second they have to sell anything into the real economy the asset values will plummet. They can only trade amongst themselves to keep valuations at par. I say they are on their last legs. They can seize assets but that just speeds up their demise as the game becomes unmasked at that time.
Their assets are held at book value. They decide what book value is.
And they will never sell assets into the market because they cannot. They will simply print more money and buy more assets to support prices.
Scotty got it rite Stockman my nigga you got it wrong! we aint in no mutha fukn "crack up" phase this is the CRACK HEAD phase! errbody runnin around tweaking off that green rock! we need that fix otherwise we die without it and we will do anything to get it! once America dies and is a mutilated corpse behind a dumpster check the rectum for the semen to see who done the deed but you might have multiple assailants so the lab got its work cut out for'em!!!
The Grammys were last week Kanye.
by looking at the budget allocation i would say we are printing terrorism. printing poverty printing extreme wealth for a few and printing self destruction. the crime syndacate cabel of banksters are the enemy. we know the enemy. debt is their tool to remain in control. greece is attacking on that front. epic, stay tuned...
Peak Debt,Hmmmm.... Now who would have thunk it? Sometimes all the pieces of the puzzle come together so logically.
You're not to supposed to know the cracks in government fraud, money launderings, and HFT (High Frequency Trading Point Skimming).
and no pip about usa 18tn government debt and100tn+ all usa debt, that's ok, don't worry
no pip about fake usa gdp also
yep, USA increased debt from 10T to 18T while (fake) GDP increased approx 2T. Clearly not sustainable
<<Why in the world would anybody in their right mind be owning Italian debt at 160 other than the fact that they’re front-running the massive purchases that Draghi has promised and the Germans have acquiesced to over the next year or two. But that only kicks the can down the road.>>
Replace "Italian" with "Greek" and you'd get the same thing that all informed observers were saying 2 and 4 years ago. The financial world is rotten like a piece of fruit. One side looks delicious and healthy, but the rot encroaches until slowly and inexorably the whole fruit is consumed. The rot spreads and the health recedes, and that's the way it's been since the turn of the century. We aren't waiting for anything anymore, not since then. We've just been watching the slow progress of the rot, pulling back steadily in our own lives to try to avoid its reach, and for those of us who want to discard this peach of a system altogether, that's been agony enough.
Let the Hunger Games begin.
Did you mean The Funger Games?
Good one.
You mean the Hungry Games? --> http://youtu.be/eT7nD02Im5E
Let the Hunger Games begin.
All aboard the freedom train to Venezuela.
Send your school aged children...I'm sure they'll be fine.
We are just Cassandras.
Hell not one person I spoke with today can tell me what a Dollar is.
THey will declare that it is money but it is not.
It is a CURRENCY. Furthermore it is a NOTE which is a PROMISE TO PAY.
I tel them this then give them examples of Notes which they ideally can relate to, like MORTGAGES and CAR Payment Contracts.
Then I ask them that since it is a NOTE, which is clearly printed upon the currency, just what is it supposed to pay?
They cannot even answer that. Of course it is a promise to pay goods and services at some time in the future. But they mindlessly trade Dollars for goods and services, not understanding that which they are doing.
Of course when PRODUCTION slows to a trickle and CEASES, due to Financial imbalances and bankruptcies, then the notes themselves become VALUELESS, as there is NOTHING that they can be traded for.
(BTW...These were small Main Street BUSINESS OWNERS, supposedly the mainstay of the Middle Class, whom could not answer these questions.)
And if they do not understand, and 99% of the people do not understand this rudimentary basic principle, then talking to them about anything else about our predicament is A COMPLETE WASTE OF TIME.
So before you waste your breath on anyone whom is out there, asleep, be certain that they know what a fucking dollar is so you do not waste your time.
There are none so deserving of the consequences of this collapse than the ones with eyes whom refuse to see and the ones with ears whom refuse to hear and the ones with a brain whom refuse to think.
David Stockman is pissing in the wind, just another Cassandra, as myself. As far as most of the people are concerned he might as well fenestrate.
And as a result we are so fucking lost.
Us coins are. Issued by the treasury still and have no debt ie counter party risk.
TT, I enjoy your posts, but please learn when you should be using 'whom' rather than 'who'. Consistent errors of this nature will lead lesser minds to think you're unlearned.
-- Grammar Cassandra
PS - and no, I don't want go bloody hunting, alright? Whenever you make that offer to your various detractors, I start hearing banjos ;-)
Okay Grammar Nazi. I mistyped and know that "whom" refers to a group whereas "who" refers to a person..
Sue me for my damned "m" key not typing. :-)
And besides Cougar Hunting can be fun. If these people will ever meet me face to face they may actually end up liking me.
But here I am preaching to the chior. I know that you know what I wrote to be true. But our little clic is not going to influence those whom do not visit the site.
Besides it is "Fight Club" and we all have personas we project. If a person came here and read everything written as a Gospel Literal Truth then...well...may God forbid...as many of us season their comments liberally with a good dose of satirical wit.
I must say that it adds to the spice of this website and makes the bitter dish served somewhat more palatable.
Forgive me but I NEVER get to say this.
"Who" is the subject of the verb: "Who" goes to the store, "Who" answers the door, "Who does the dishes". "Who (shall I say) is calling?"
"Whom" is the object of the verb: "To whom did you speak?" "Whom did you see?" "From whom did you receive this blouse?"
Put them together for hours of pronoun fun! "Who sent you that chain letter, and to whom will you send it on?"
"Who will escort you to the dance, and whom do you expect to see?"
"Who handles this case depends on from whom it comes."
sigh... that was nice. It is so very, very seldom that I get to hold forth about the difference between subject and object pronouns!
See how easy it is to bring joy into the life of a grammar nerd?
"Who's on 1st...?"
A four bagger is a .... Whom Run !
Try a simple test - Just substitute he for who or him for whom (both him and whom end in M), and most of the time, you will get it right. Use who when he sounds better and use whom when him sounds better in the sentence.
I just never use 'whom.' It seems to be a good policy.
Safe.
Who will your pimp arrange a meeting with and to whom will he pay the money?
"See how easy it is to bring joy into the life of a grammar nerd?"
This site is SO educational. Finance and grammer all in one!
Whom whould have thunk it?...
Thank you for the correction and accurate rules, Renfield.
Sorry to be pedantic, Tom, but it's "clique" -- not "clic." ;-)
Yeah. That's not just a mis-key. Tall Tom lacks.
It is that which I do not lack and have that will cause you concern.
I am happy my main focus in study was Physics and Math...and not Grammar.
You are correct. I will add that information to my moronic lack.
Not only that, I'm pretty sure you meant "defenestrate" :)
I think it's too risky to use the 'word', "alright." It's gaining acceptance, but the use of the word may put you in the same category as TT, too. All right? LOL
ZH grammar use has evidently reached the 'crack up' phase.
What about those with guns who refuse to fight?
When you put your hand into a bunch of goo that a moment before was your best friend's face...
GSP, jr. 1944
George C Scott 1972
...you realize that you've been used by the bankers?
@Tall Tom- here's a couple very basic sources I've passed out to people -
The book 'Dishonest Money' by Joseph Plummer. Easy to understand even for a bright jr. high school kid. And the DVD cartoon called "The American Dream: Fighting the Lying Liars One Stupid Lie at a Time" - runs about half an hour. You can buy it or find it on YouTube for free. Both these sources explain the Federal Reserve.
The difficulty is getting anyone to actually read the book or watch the video.
Today most Americans seem to love their intentional ignor-ance. They also are mental & moral cowards.
Good luck! Gotta keep fighting the good fight.
No doubt these are good but I think many need a foundation in the basics. Peter Schiff's How an Economy Grows and Why It Crashes book does a good job of that. Most people don't understand capital, how to create wealth, etc.
Actually TT there is very good reason to be informed of such events we are experiencing and observing these days. Most realize some major adjustment is past due and will arrive. But that is no reason to live in fear or do anything except simply understand it all. And might as well be super healthy and fit in the mean time ! There is no downside, only benefit and later it will serve you very well. So it is not at all a lost cause or fools errand at all to be completely informed and understand the many illusions. There will be a different set of circumstances and motives later and materialism/money won't have the same meaning or power it does now. Your brain and skills and health will be worth more than anything !~ Many who have those attributes and a few more, will be just fine. Perhaps better than now ?
Deleted
"production slows to a trickle and ceases"- are you saying that gold will not buy anything, as well ?
oh my
Sounds pretty accurate to moi.
Music still playin'......keep on dancin' !!!111111
Your comment made me think of Gig Young in the movie " They Shoot Horses Don't They." Yowser , yowser they're still on their feet ...... Men in denim built our country while men in suits destroyed it.
The band on the Titanic kept playing...
But you can still take roughly 1200 of those $1 NOTES which is a PROMISE to pay in the future and buy 1 oz of gold.
Thank God for that. Yes we can still protect ourselves.
But damn it. The rest of these losers out there are not doing that.
You cannot tell them any different. I just answered on the Mark to Market article that it is insanity, stupidity, or a measure of both that is driving the Dollar.
Nobody out there is listening and here, on ZH, we just are preaching to the chior and the trolls whom are here to attempt to discredit us.
We are so doomed as those whom do not have we be begging in the streets and starving and they have no political will, no will whatsoever to put a stop to this as they are told what to think through the incessant BRAINWASHING, the programming from the professional liars, from their hot tin boxes with a Plasma Screen.
We are cooked.
TT, it is a trade of.
If they did it wouldn't be 1200.
It is literally a prisoner's dilemma.
You should be more optimistic. Instead of seeing it as a prisoner's dilemma, perhaps call it an escapee's opportunity.
It sure is a trade off, you are right. However, the conditions in which that trade off occurs will be such that the price --- be it higher or lower than $1200 --- would be fine and dandy. I posit that the power of the bankers would be much weaker than it is now.
At Christmas, I only give gold (to my daughter) and silver (to my nieces and nephew) and I try to explain why, what is real money and the stories of failed fiat paper.
They don't yet get it. The mellennials are wrapped up in iCrap and all the lies that are their generation.
Still, my effort goes on, and so should yours and everyone else seeking the truth and seeking to tell it.
This temple of lies will burn to the ground soon eneough and the next generation needs SOME who have a clue. Some who have heard from a crazy uncle.
For silver I use Peace and Morgan dollars - for gold I give Liberty Head $5 and $10 coins and tell them "this used to be OUR money" and ask "why isn't it now"
choir.....preaching to the choir...
Dear TT
Because you are preaching to the group, of whom I am a member, I just thought I'd mention that is "choir" not "chior." Reading it the first time was okay, but now it's getting a little irritating.
Sincerely,
Chumly
The degeneration of ZH into a Grammar Nazi haven is that which has become irritating. But I can live with that.
What is horrifying is the appearance of the financial abyss before us.
Instead on concentrating upon the meaningless and inconsequential you might want to open your eyes and see the final destination.
The degeneration of ZH into a Grammar Nazi haven is that which has become irritating. But I can live with that.
What is horrifying is the appearance of the financial abyss before us.
Instead on concentrating upon the meaningless and inconsequential you might want to open your eyes and see the final destination.
Shits goin down this fall.
Prepare to get your bankster hunting on. The end is nigh.
'' Why in the world would anybody in their right mind be owning Italian debt at 160 other than the fact that they’re front-running the massive purchases that Draghi has promised ''
If I recall correctly, the Honorable Jon Corzine loved Italian debt. Wait....did he say "right" mind?
Derivitives $ 700 Trillion + Derivitives . . . Barney Frank / Chris Dodd were there to stop it , , but they did not . . . they got paid not to. . . by the big banks. . . they should be hauled into court someday...
Not courts. Public Gallows.
Guillotines!
Woodchippers.
Feet first.
Scaphism.
Or a glass rod up the peepee hole, foreskin stapled to a 2x4, then WHAMMO! Hit that shit with a hammer, and force feed them water, beer and coffee while denying them any sort of medical attention.
It's what they deserve, anyway.
I had given up smoking, your comment on scaphism caused me to light another
errr
I assume by mentioning Frank & Dodd first, that you've already plunged Alan Greenspan into a cauldron of boiling au Jus.
Very gloomy... Does this mean I should sell the dow?
Nah, this "crack up" phase could last another six years.
yes, and all the buildings in downtown NYC
sell the dow? ...
Here is what you got on Friday Feb. 13
http://patrick.net/?p=1219038
sell the dow? ...
Here is what you got on Friday Feb. 13
http://patrick.net/?p=1219038
Better you should dell the sow.
And at that time the twelfth pajama boy will emerge from his lair ...
... and if he sees his shadow he will return to his lair and we will have six more years of QE.
Stockman meant "crack whore" phase but it was redacted in the interests of it sounding more PC
Demand is dead in the water. Around where I live and work, demand exists only in the Public Sector Employees and Health Care sector workers. They still build new houses, buy new cars, go to Europe on vacation, buy boats and summer houses. That much is true everywhere I believe. But if we are talking private sector employees! They are in survival mode, and with falling wages, rising health care and food costs, the fear of job loss, and actual job loss, the decline in good paying jobs, the private sector families have almost zero demand for anything but life essentials.
The bubble in Government in Health Care just bubbles along, but for the rest, seeking work at a decent wage is very hard, and most private sector families I know are under stress and fear. No wage increases, and jobs that could go at any moment. New jobs pay 7-8 dollars an hour. About the best jobs going pay $12.
If you finally get a "creature" with a heart, you just hit the heart. Goldman Sachs.
Jack Burton,
Government workers are almost completely insulated from economic downturns. Nearly all have guaranteed salaries, guaranteed raises, complete job security, and generous health care and pensions.
The more people at the government trough, the easier it is for the politicians to get re-elected and make ever more promises.
and unless they kill somebody, ya cant fire them
Unless they're white males in the way of a minority female who is a "victim" of their "racism" and/or "sexual harassment".
Jack Burton and Sweet Cheeks,
It is not the fault of government workers- it is the fault of Central Banks that allow oodles of government debt. Private industry cannot acquire as much debt as the government can therefore they cannot keep up with a living wage. Look at a chart of government debt since 1971- the year we left the gold standard- it is an exponential rise. Now look where wages began to stagnant for private sector- it occurred at the same spot- 1970s.
To state it is the government workers fault does not make sense. They did not allow the government to take on the debt to fuel the rise in wages. They simply took a good paying job with benefits. When we fault people for acting in their own best interest it makes no sense.
Frame the argument against the Central Banks- government workers-(excluding Congress; they don't work they campaign)- are your neighbors. They spend their healthy paychecks back into the system, they buy your products and services. Central Banks have a mandate to increase inflation- private sector employees pay does not keep pace with this manipulated number. Central Banks that are beholden to nothing (no gold standard) are the problem.
If we had maintained a gold standard then government would not have the levels of debt they have now and state workers paychecks would be more in line with private sector pay. Governments would have to be more realistic with what they could take on and Unions for police officers and firefighters would realize the lunacy of expecting to retire at 55 with 90% of their salary. Local governments would have been cut off before allowing such idiotic promises to be made.
Physical gold increases at about 2.5% a year the same as population. It is better to have those who can't seem to get enough money be limited by some physical basket of goods- like gold and silver- then to allow them to print willy nilly. They are the reason for the inequality and diverging pay between public and private sectors.
In other words, the vultures didn't kill the buffalo, they are just picking the carcass clean. This is the nature of vultures so they can't be blamed.
SHRUG
Hopefully they'll all be in Europe when the crash comes and we can plunder their houses just to get the party started.
Normally I keep the fat finger up my ass where it belongs but this time I slipped.
Hey you two HONEST guys, tell these truths:
Stop whoring for Wall Street.
http://www.showrealhist.com/yTRIAL.html
http://patrick.net/?p=1223928
Stockman was the only credible member of the 1st term Reagan Administration.
The rest of them were psychopaths.
Quit'cher bitching! Be thankful 95% of these morons are blissfully ignorant of the sword of Damocles hanging over their heads. Otherwise all the idiots would be bum rushing the exits and making things even harder for the enlightened.
I say F'em, if they wish to be sheep, let'em be sheared. Hey these brain dead meat puppets elected their all things to all people wet dream president and then amongst the ashes of his hope and change RE-elected the fool. You can't help these people.
Yeah I know, R & D's two sides of the same coin, but geez, anyone who couldn't see where this clown was going to take it, and after four years DOUBLE DOWNED on it. My god, let'em burn!
"My god, let'em burn!"
All well and good, but I have the feeling I'm going to be singed in the process.
When both my neighbors houses are on fire, mine's at risk, too.
You're an OldPhart, you're supposed to be living the RV lifestyle.
When the crack up starts, which it has already, the crack down will commence in earnest. Not if, but when the riots start, from lack of food, gas, money, (got gold & silver, no problem)the gubbermint will crack down on free speech, gun ownership, hoarding of precious metals (hope they have scuba equipment) and the internet.
I fear it is right around the corner, but I thought that 6-7 years ago and those rotten, dirty bastards have held it together with bailing wire, glue and a magical printing press.
Death to the banksters!
So the market is a drunken sailor, but it's run by bots. If it were run by bots we would see clear trading patterns. Bots cannot hide. There are no patterns. The market - as always - trades like a drunken sailor.
Stockton you've long since passed your prime.
Confucius say: "Rady who fry upside down have crack up."
Negative interest on savings is a bail-in pretending to be something else.
Everything for the bankers! - EVERYTHING!
E V E R Y T H I N G !
Nothing for the people who built and paid for every fucking thing we see.
QE for people's bank accounts, do what Steve Keen is saying, put deposits into people's bank accounts, and if they have loans make the money got to the creditors to pay down their personal loans.
Instant economic recovery.
But no! ... we don't WANT systemic functioning and private enterprise to get a chance.
All the chance has to be in the TBTF zombie casino that is destabilizing the entire planet.
DESTABILIZING THE ENTIRE PLANET
Let that sink in for an hour or three.
Once interest rates cross the Zero Bound, there is no going back. It is like crossing the event horizon of a Black Hole. Rates must accelerate in the negative direction until the currency system is completely destroyed.
Please write a post about it Andrew, and submit to Contributors, and if you wish, please also state why you think Keen's proposal will not work in that context. This needs to be thought through properly.
China this, China that, what about USA debt? Where are the articles about USA's debt?
Mr. Stockman has beaten that horse flat on previous occasions.
The current S&P 500 wave count supports Stockman's assertions. Since the beginning of the year the short term wave counts have been muddled at best. It’s time to step back and look at the bigger picture again.
http://www.globaldeflationnews.com/sp-500-indexelliott-wave-update-for-w...
Think Global
ACT local
it's 10 to midnight, do you know where your local global banksters are?
Out of state. If there are any local bankers (I'm not counting tellers and branch managers and the like,) I don't know about them. Around here, it's either a local credit union, or a bank that was either bought out by a bank holding company or was muscled out with the help of the government. The Bank of Albuquerque is owned by The Bank of Oklahoma, for example.
I do know where some of the shysters that they hire to sue the shit out of anything that moves do business though.
Crack up, here we come, loaf of bread $5,000.
Or one silver quarter.
Bankers are now running the world.
Central Banks are there to look after banks and every Government has a Goldman Sachs alumni adviser on board to direct financial policy.
An unholy trinity has been formed of banks, central banks and politicians.
What is the banking business model?
To borrow from the future to spend today.
You get your loan/debt today and spend it, the repayments come in the future,
The future is here.
Running a demand driven global economy on supply side economic theory was always going to cause problems.
yeah..theres some talk of them raising interet rates..lol.
they will lower them into the negative area before they raise interest rates since raising them would destroy the economy.
Anything that they do at this point is probably going to destroy the economy. It's just a matter of when. If you're in a burning building with no chance of escape, do you jump off the roof to your death, or do you wait for the smoke and flames to take you? Neither option would seem rational, but if they are your only choices, you're probably going to do something that no person would choose to do.
So does the Fed jump, or does it burn? Either way, I'll believe it when I see it.