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We Just Broke 2008's Record For The Fastest Economic Unraveling!
Submitted by Thad Beversdorf via FirstRebuttal.com,
In my last piece I provided a technical analysis that signaled we are entering the first stage of a bursting bubble that we’ll call the Fed Bubble. Now while I do believe technicals provide good insight to the economic landscape I see them as a necessary rather sufficient qualifier. In order to be truly confident that our technicals are providing an accurate story we need to understand the fundamentals behind the charts, as we often find the engine light comes on due to a loose wire rather than a problem with the engine.
The final Q1 GDP revision was just released and we saw that GDP has again missed expectations by such a large margin that 2015 is another write off for a 3% growth year. Almost comically we heard the same excuses we got last year. “Weather was wintery and next year is going to be the turnaround year”. So in order to explain to these supposed economic and market ‘experts’ who seem wholly incapable of understanding economic and market forces with any sense of accuracy, let’s run through a few fundamentals.
I want to hone in on the category of consumer spending that is first to go away so that we may capture the first signals of a consumer spending pull back. A good proxy for this is the Johnson Redbook Chain Store yoy sales. This captures the consumer spending taking place at large department stores (Macy’s, Kohls, Walmart, Kmart, etc). This is going to be where the real discretionary retail spending takes place, as in do I have enough space on my credit card for that sassy blue dress and groceries or just groceries? And don’t think that is just a theatrical example. I remember the days of asking myself those very same questions (ok maybe not the blue dress but you get the idea). That is just real life here in the US (and Canada for that matter).
So this category does well to target the true discretionary spending. Now if the chart trend appears strong or even flat then we can be confident consumers have not yet pulled back on even the most discretionary of items and so any variations in the overall spending patterns are likely not worrisome. However, if we see a sharp pull back here it is indicative that a downturn in the overall spending trend is likely substantive rather than nuance. Let’s have a look.
What we find is that over the past 6 months we had a tremendous drop in true discretionary consumer spending. Within the overall downtrend we do see a bit of a rally in February but quite ominously that rally failed and the bottom absolutely fell out. Again the importance is it confirms the fundamental theory that consumer spending is showing the initial signs of a severe pull back. A worrying signal to be certain as we would expect this pull back to begin impacting other areas of consumer spending. The reason is that American consumers typically do not voluntarily pull back like that on spending but do so because they have run out of credit. And if credit is running thin it will surely be felt in all spending.
But one chart doesn’t a story tell, and so we must continue in our quest to determine whether or not we are on the precipice of another crisis. Another early indicator I like to look at is wholesale trade. If any sector has its finger on the pulse of the consumer it’s the wholesale/distribution sector. These guys are constantly talking to retailers to gauge where the consumer is at any given time. So let’s have a look to see if wholesale trade is giving out any clues.
Currently we find ourselves on the bottom of the latest peak to trough draw down which has given up more than $100B in wholesale trade. Interestingly we should note that the last time we saw a $100B peak to trough draw down was between June 2008 and January 2009. However, while it took 7 months to give up $100B in wholesale trade during the Credit Crisis, we’ve just done it in only 4 months. What this means is that the wholesale trade sector has recognized what the chain store yoy sales chart above depicts, namely that the US consumer has begun to max out. This is further supported by the inventory levels as per the latest GDP print, which made up 1.24% of the .2% print (wait doesn’t that mean then…. yes you get it).
If I haven’t convinced you yet that we are entering the final phase before the Fed Crash well let’s carry on. Again, we’re looking for early indications as to what we can expect in output (economic activity) going forward. So why don’t we have a look at manufacturing new orders to gauge what’s going in the pipeline because that should tell us how much output to expect over the rest of this year.
The above chart depicts an ugly story if we’re hoping for an increase in output with just 1 of the past 7 months having had positive growth in new orders for US manufacturing. That is something we simply have not seen before, not even during the second half of ’08 and all of 09 in the darkest of period of the Credit Crisis. That fact alone should send a shiver down your spine.
Now it’s not like any of the above just happened yesterday so why is it that month on month and quarter on quarter we continue to hear that “well we failed again to reach the highly touted expectations for economic growth but all the signals are there for next quarter”? Shouldn’t we be hearing that there has now been a real downward shift in what was already a flat lined economy at best? Yes of course but unfortunately the media refuses to do its job as challenger to the status quo and our policy making economists are frauds. They are nothing more than puppets for the global powers that be. And the longer they can keep us from the truth the more well positioned they can be for the inevitable collapse.
But that doesn’t excuse we the people for so readily accepting the Fed’s extreme view that the US plummeting economy equates to “transitory weakness”. Although in fairness, we are hearing the economic news with the backdrop of a scorching equities market and so we kind of just go along with the Fed’s extreme message because it seems harmless enough so long as the market is still roaring. The same thing happens in all bubble cycles. That is, the Fed denies there is a material problem up to the point that they are scrambling to convince everyone that either it was impossible to see it coming or that they actually had warned everyone but it went unnoticed.
Have a look at the following excerpt from the March 28, 2007 Bernanke Economic Outlook, before the Joint Economic Committee (US Congress) and tell me if it sounds familiar despite you likely never having read or heard this previously.
“Business spending has also slowed recently. Expenditures on capital equipment declined in the fourth quarter of 2006 and early this year. Much of the weakness in recent months has been in types of capital goods used heavily by the construction and motor vehicle industries, but we have seen some softening in the demand for other types of capital goods as well. Although some of this pullback can be explained by the recent moderation in the growth of output, the magnitude of the slowdown has been somewhat greater than would be expected given the normal evolution of the business cycle. In addition, inventory levels in some industries–again, most notably in industries linked to construction and motor vehicle production–rose over the course of last year, leading some firms to cut production to better align inventories with sales. Recent indicators suggest that the inventory adjustment process may have largely run its course in the motor vehicle sector, but remaining imbalances in some other industries may continue to impose some restraint on industrial production for a time.
Despite the recent weak readings, we expect business investment in equipment and software to grow at a moderate pace this year, supported by high rates of profitability, strong business balance sheets, relatively low interest rates and credit spreads, and continued expansion of output and sales.”
Sound familiar?? It sure as hell does! This is exactly what we are being told now. Inventories are up, business spending has slowed, Capex is down but despite all of this recent economic weakness the Fed (and all mainstream economists) expect moderate growth this year. Additionally that the economy will be supported by high profitability, strong corporate balance sheets and low interest rates. Absolutely mind blowing how similar the storyline was back in March 2007 to today’s storyline. Let’s see if we can’t find some other similarities.
Now remember 2007 was just a precursor for the real wealth transfer that took place in H2 08. But as you can see in the above chart while the two periods depict very similar market movements, 2015 has generated the same pattern in a much more accelerated time frame. From this chart and the excerpt above I have a couple points. First is that we cannot listen to the Fed or any mainstream economists because we know they will be the last ones to realize or at least to acknowledge that a severe problem exists. So please don’t ever think things are ok because you’ve heard it so from Stevel Liesman or some other clown pretending to be an economist on television. The second point is that according to the excerpt above from Bernanke’s 2007 Economic Outlook, the fundamental landscape directly ahead of the Credit Crash appeared almost identical to what we are experiencing here in 2015. I would caution you not to quickly write it off as just a coincidence.
If you take the technical piece I wrote a week ago in conjunction with this more fundamental analysis, the economic storyline describes a precarious environment for equities certainly, but for our general quality of life too. If things do breakdown as they did in 2008 the pain and suffering will be much worse this time around. The reason is that median net worth is down 40% from where it was just before the last collapse. U6 unemployment is already twice what it was prior to the last downturn. Debt levels, both individual and public are at record highs. All of that means a much worse bottom than last time.
But probably the most disheartening aspect of the coming reset is that almost every retiree or soon to be retired household has just about 100% of their nest egg currently in equities. This means a significant market crash will create the largest single wealth transfer in the history of the world. I cannot stress enough that this is the time to be exiting equities altogether. There is very little if anything that could push equity valuations higher right now and a strong likelihood for markets to revert back in line with the still very broken economy. Protect yourself and preserver your family’s interests.
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back in 2008 the Fed lent out trillions to any corporation that could fog a mirror at .01 of one percent interest...basically that works out to 100 $ interest for a million dollars loan..
must be nice, a million bucks for 100 $ a year...
might be time for the Fed to re up
Economic Terrorism... http://galeinnes.blogspot.com/2015/04/economic-terrorism.html
Paul,
You forgot if the banks default on that loan (pocket it), the taxpayer un-pickets up the bill.
I want that deal. Borrow a million, pocket a million....sign the bill to someone elses room.
RIPS
Agree. Is anything in nature too big to fail? Too big to die? Too big for reality?
F'n bankers. White-collar crime in the name of "saving the financial system". Except, the financial system keeps asking me to pay: higher fees, higher taxes, higher health care, higher house price, higher utilities. So I say fuck this cockroach infested financial system. Let the bitch fail.
I wonder when, if ever, we will execute those "arsonists" Timmy? Still can't figure out how he got away with publishing that book. Some pretty damning stuff in there.
Self absorbed narcissist, publishes a book about himself that no one reads. Maybe that's where all this deflation is coming from: Falling Bernanke and Geithner book prices, as no one is buying them.
And this is including the fed buying spree called channel stuffing?
RIPS
*the fed doesnt deserve caps anymore...
Super-inflated baloons tend to burst, not deflate gently.
This is so common sense 101 that you have to admit to yourself that th epeople in charge know EXACTLY what they are doing.
Meanwhile, for the trippers, Native American Flute and Drums: Sequence 12
https://youtu.be/pNYSDv3EpW8
Anything but TARP2 , we couldn't afford it then and we really can't afford it now.
You don't have to fix it, just let it die.
Id like to see a chart that shows if it is consumers who are maxed out in their credit/debt that's available to them, or if at least a decent % of the population is finally starting to wise up and not use it. I have 45k available on 3 cards, and I have a zero balance on all of them. I use one that I get 5% cash back on groceries and another I get 5% on gas, which I pay off as soon as I make the purchase. I refuse to go into debt to buy stupid shit I don't need, I'm not playing their bullshit game any more, ever. If people do what I am doing, their Ponzi runs out of steam, as it requires constant new debt creation to survive.
One major drawback to fighting the Ponzi by using cash-back credit cards
is that the banks charge a hefty fee to the retail outlets for using a cc payment.
That cost, of course, must be passed along back to ...
Unfortunately, those with lower credit ratings and those who forego using cc
(as well as those getting the cash back)
effectively subsidize the cc 'cash back' through higher prices.
The banks get a hefty fee on all transactions as well as TBTF gov't handouts.
It is not so easy to escape the matrix.
Agreed. Gimmicks, all of it. Best to withdraw from banks in general. Bitcoin gives you the same utility of a cc and more, plus it's not beholden to bankers. The value of bitcoin should move inversely to the collapsing equity and forex markets. Having a $1000 in bitcoin today could be your families lifeboat in the next couple of years.
Well, that's exactly what they're trying to do, crash the current system!
"these supposed economic and market ‘experts’ who seem wholly incapable of understanding economic and market forces with any sense of accuracy"
They are globalists who know that the dollar and the ideals of our constitution (along with nationalist ideals elsewhere) stand in the way of their agenda. They are destroying both from within to make room for a global government controlled by a financial system with a world wide cashless currency. They are openly doing exactly what they've planned in secret, All the while we complain about what a horrible job they're doing fixing our financial system!
Why do people continue to think we're dealing with buffoons? How is it they continue to baffle anyone especially those who write for these blogs?
If these rats are doing exactly what they've planned while coordinating to baffle and confuse a majority of the planet into thinking they're just incompetent, they're doing their very best to fix an out of control economy, a problem they purposefully created, who are the real buffoons?
I find it hard to believe the writer of this article doesn't know this! I wonder if much of the hand wringing by so many Zero Hedge articles about the incompetence of those in charge are not simply part of the plot, disinformation to keep us confused?
These people are Ivy League Graduates. Even Mao Zedong was a Yale Graduate and member of Skull and Bones. THEY'RE NOT DUMMY'S, THEY'RE EVIL GENIUSES and DOING IT ON PURPOSE, DUHHHH!
So next time a Tyler comes out with another story about the dummy's at the Fed, just remember who the real dummy is.....
In todays world this is very bullish news. I fully expect some random country to cut interest rates another 0.25 basis points or talk about QE over the weekend. The market will be up 100 points on Monday.
Time to go long on ink, paper and ultra high speed printers! What could go wrong?
look for leveraged speculation to be counted in GDP soon.
Or hookers and blow like the UK.
U can almost hear the crickets on a million for a hundred bucks these days!
See the desert of the jungles existence!
"ObamaCare";
It was supposd to have recollateralized the derivative house of cards by hustling another 30 million paying bodies into the bankers service-but that hasn't materialized. "can't get blood from a stone" There are good reasons 30 million people were uinsured. Waving a wand can't change that.
Obamacare's increased costs has sucked out discretionary spending from all corners of the service economy, in the process hollowing out previously "good" collateral.
Its complete repeal by MN tonight would lessen the October Crash on the horizon triggered by lack of discretionary spending income; it would also bolster some of the collateral dykes a bit.
But absent a productive economy since about 2006, the collateral shortage on the horizon is a tsunami at this point.
The banks, fueled by government Constitutionally unrestrained, have managed to crap the world.
I was forced off my private plan and had to pick an Obama/Piglosi/Reed approved plan that half my doctors are not on and my deductible doubled.
You are one of the lucky ones.
Thank goodness we all now have free healthcare!
Next?
"might be time for the Fed to re up"
The real problem with opiates is the tolerance build-up...after awhile, it doesn't matter how much you shoot, you're still going to be writhing in pain.
They will keep it afloat at all costs. QE X on deck for the foreseeable future, and it doesn't benefit consumers at all.
It is all artificial now. It stays up until it doesn't.
Consume credit contracting rapidly in 2015. That agrees with consumer confidence numbers.
http://www.moneyandmarkets.com/consumer-credit-trouble-looms-70890#.VUTb...
Calamity is certainty! Plan and prepare accordingly!
You can be honest, we're all friends here.
Ode to Billy Jeff...
Support group?! I thought this was a get rich quick seminar.
We might as well include an update on manufacturing jobs in America...not pretty and that's before we really see the impact of the strong dollar or the slowing global economy...this is likely as good as it gets and down from here...
http://econimica.blogspot.com/2015/05/manufacturing-recovery-or-manufactured.html
Long black markets and sharecropping. Those charts make it very easy to see when the central planners took over and the last remaining hint of price discovery was destroyed. Good luck to them with that linear slope and thinking in an exponentially complicated system. Turns out the dinosaurs were more evolved after all...
We don't need no stinking manufacturing jobs! We are all going to live the good life as a salesman or just sit at home and trade coupons on the way internet.
Oh boy, this can't be good for the Jews.
That say they are, but do lie?
Might be enough to send the markets to all time highs!
There you go with that F-word again. Wasn't that word banned a while back? Or maybe they renamed it Funny Mentals.
Fund-Duh-Mentals.
but bad news is good news or something... ...no fucking spoon, period...
get to know your neighbors, you might need each other soon.
"get to know your neighbors, you might need each other soon"
I know which neighbors are fat enough to be rendered into diesel fuel when time get tough.
If things ever get real bad, once could probably mow down a swat team line & have enough to run a tractor for a year.
I guess I better get a diesel vehicle before I "start-a-rendering"--doh
Some in front of firing squads, some behind a plow.
Best reason I've seen all day to buy moar stocks.
Cyclical. Just like in 1996-1997: $100 spent on your small business will yield $125 in this economy. It takes money to make money, but brother, it's out there. Keep fair and make your service shine.
Aren't you that guy selling AZT cocktails from Dallas?
5x-10x my costs
or it's not worth my time
40+ yr craftsman....
Three words:
Mark to fantasy.
That is all.
Technically, mark to "model", but yes, the model is pure fantasy.
Mark to an insane mind's concept of reality.
Mark to whatever keeps me on this side of prison.
hahahaha
I am already seeing a trend similar to this in my line of work. Orders are slowing, payroll is being cut, but the inventory is up since we purchase based on historical trends. At this point, I cannot see purchasing anymore inventory for the balance of the year.
Work just evaporated?
Yea I started hearing that an while back... When was that? End last year or early this year... Yea and for peeps that can do all kinds of stuff!
Never usually evaporates that fast like a breeze just blew threw knocked all papers off the tables and dried up like California!
Austin still rumbling around a bit but only the world is moving here so...
We better get some rain above the dams! Not getting enough able the big dams!
But that's basically the dry line between desert and swamp of west and east...
The Houston-based multifamily industry giant (NYSE: CPT) will likely hold off on starting new apartment projects in the Bayou City until at least 2016, Camden chairman and CEO Ric Campo told analysts during its first-quarter earnings call on May 1.
The streets will be poured, and a house or two gets started, and then it stops.
Wow. When they aren't even willing to build into a rising rental market, that's huge.
I'm surprised to even hear about businesses that have inventory in the age of JIT supply lines and Chinese manufacturing.
Hey author thanks for keeping up with those stuffed channels numbers for me... U have a more clear perspective of the numbers. I appreciate it because that is a BIG deal!
Especially if they start thinking they can keep stuffing channels for a good economy in the higher ups bankrupting capitalism.
Also channel stuffing prevents quick rebounds. Sometimes it is no problem and when biz picks up all the inventory buildup slack disappears w no issue. But I have seen bull economies destroyed by inventory slack. Compac used to pull that shit and ruin good bounces off bottoms in the QQQ and entire computer industry... Not a place where one wants old out of date inventory.
Sometimes the problem is isolated but other times it brings the whole place down when it should rebound.
Helps investing in the next bull run too... Or making bis decisions.
We are getting the pep talk from the CEO right now, he was doing the old "we got to pull together and win!" speech and then he says "What keeps me up at night? It's not all debt(We got a bunch lol) it's not the stock price(It's going nowhere) its all the complaining!" I had to walk out at that point, the shit was getting to deep and I didn't have my boots on.
It's not fundamentals, it's emotions, with a straight face!?
Yea rob and u know how can u get laid off if they can't find u?
Hope u left on a happy note like kastanza! If u didn't just slip on out as not the face to represent blah!
Your CEO sounds like a real winner to me. I'd punch him in the face.
Be assured of two things: he sold his and you should too.
I work at a profitable company where the corporate politics just went from 2 to 7 in six months. Trying to solve problems was once welcomed, but now is met with a kill-the-messenger approach.
So QE works! For a while and for the rich. Bamm!
Even the downside is a smorgasbord of M&A and accumulation on the cheap.
I've seen vomitoriums with more decorum.
100% in equities? Surely you must be kidding, because there's no truth in that. The stock market may very well be high historically speaking, but the real bubble is in the bond and RE markets. Which retirees and near-retirees are heavily exposed to. Stocks, in contrast, actually offer some comparative value relative to the bubble of RE valuations.
Stocks are more liquid than RE for sure.
By liquid I assume you mean when the bottom drops out stock prices drop a lot faster than RE due to their low viscosity and high flow character? Cause that's what always happens! (Ever hear about RE dropping 20% in a day like in '87?) Note the use of the word REAL in RE. You can actually live in a and stay warm and dry in a house-a stock certificate or brokerage statement can't even repel the rain for a cardboard box house-and not really suitable for wiping your ass either. So, with equities its all about CONfidence-emphasis on the CON.
That liquidity is quite conditional, you'll find...and the volatility, well, let's just say that if we could harness it as physical energy, we wouldn't need oil, solar, or wind.
I wanted to get a better view of the bottom charts where 2007 is compared to 2015.
And I pulled up some charts from stock charts.com who had a 2007 chart and a 2008 chart and one with a mix of the two.
I noticed on my charts from the 2007-08 era, as I got from Google was focusing on the rsi indicator.
So then I grabbed another chart box and got it set to show me all rsi and looked up for a year the Dow (dia), s&p (spy) and the Nasdaq (QQQ). I focused on the rsi. And just like before that crash as almost shown above as chart cuts off... Our rsi is not hitting the upper band as we hit higher highs on charts and is most obvious in the Dow. We haven't dropped yet to the lower band and are hanging in the middle but out higher highs only keep us in the middle of the bands.
This too happened before the last crash and was a total bell ringer for what's around the corner!!!!!
Second that rsi drops from here further now that it can't reach up to upper band in high as it usually does we r going down.... Down ... Down ... Down .. Down ... Down...
Tags:
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Read more: WHAT REALLY HAPPENED | The History The US Government HOPES You Never Learn! http://whatreallyhappened.com/#ixzz3YvDrSLJ3
I drink more alcohol now. Does that count?
Just 1 out of 5....?!?
I'll take the over. And a cocktail, please.
Why'd you have to say "fifth"? Now I'm headed to the liquor store and the weed spot.
O God, let it crash. let it crash. So we can get the real economy going.
Patience. You need to let the 1% "divest" themselves before that can happen and they're just about done with the borrowing from Peter to pay themselves handsomely routine.
My career blew up in 2009. Not because my fund did not make it through but because I had a shithead partner who shot me in the back the moment the smoke cleared and cut a personal deal with our largest investor. Anyway, trying to make ends meet and doing a lot of things. One of them is being an adjunct finance professor at the College of Charleston.
It has been a pretty fascinating excercise to look at formulas I have not really used directly since business school. But this one catches my eye the most.
the value of a perpetual stream of cash flows is
Cash Flow/ (required rate of return - perpetual growth rate)
We have a reasonable estimate on Cash flow = S&P 500 2015 EPS = ~$130
Long term growth: GDP = 2% Pretty solid.
S&P 500 Closing price = 2108. Solid
Req Return? Who knows. Solve for it.
This means that equities are being discounted on a standalone basis at 8%. If long term equity volatility is 15%, that means that the market is only discounting the risks we face at half of normal volatility. Normalizing that to a 15% discount rate takes the S&P to 1000
When I look at the risks:
Broke Government, Broke banks, Entrapped fixed income investors, geopolitical concerns, riots in the streets, record debt, crazy high real unemployment, crazy high real inflation...
It is hard to make the case that 15% is high enough.
Tough to see how this can possibly end well. Even if short term rates go up a little, that required rate of return is going to leap because everyone knows when rates turn, they turn for a long time.
Good numbers, adjunct professor dude.
But you have to discount also for the risk of staying out. With ZIRP that's a certain loss of four or five percent plus inflation. That's pretty much your other 8% right there.
It's different now, with the perpetual (and secret) printing press. The risk is in not being on the bandwagon. And if and when the bandwagon goes off the cliff, hey at least we all go together.
Thems poor peoples problems never been better for the rest of us.
If we have a pullback now truly as deep as 2008, this time it won't stop there.
And as soon as it starts the Fed will print moar money, but how will they distribute it? I hope it's with cigarette girls who dress up and hand out free samples on the street corners. "Here's a thousand dollars citizen, would you like moar? Have a nice day!"
I doubt there will be bailouts this second time around. The elite had a chance to rebuild and divest their holdings over the last 6-7 years with help from the CBs and banks access to ZIRP. This was never about helping the common folks. When it crashes now, there's no saving grace for anyone. You're either in a position to survive or you're not.
No bailouts? QE is a bailout every day. And they're still QE'ing about $10b a month out of interest on their $4t in sour instruments, published here the other day. No bailouts, heh.
No, this time the 1%, or more like the 0.01%, will be totally isolated from the crash so they won't need any more of a "bailout" than they've been getting every day for six years.
Oh you mean for the average guy, well there wasn't last time either, and they (y'know, them) feel a little guilty about it. Anyway we can dream, can't we?
You doubt bankster greed in the electroplated age?
If you robbed a bank and noone batted a fucking eyelash, would you do it again 7 years later?
glitchy keyboard, made in China
Because you guys have 'Freedom' down there, some cop will pull your cigarette gal over throw her in a paddy wagon to get bounced around, blackmail her for 'favors' or choke her to death for selling smokes.
Let's run a few fundamentals? why?
So when the QE taps run dry and we depend on the masters of the universe getting paid millions allocate capital, they fail? But still take home the billions? Great Economic model. I guest just like Clinton and Bush...they implode on exit!
Bail-ins won't hurt me.
Didn't you hear? The economy doesn't matter. All that matters is the price of stocks. People don't need jobs. We need more immigration. People don't need to save for retirement, we need to spend,spend, spend. We don't need peace, we don't need honesty, we don't need morals, we don't need ethics.
We are the new Babylon ... we are the new Sodom ... we are the new sacrifice to the gods.
Castro didn't clean out safety deposit boxes .... the day he rode into Havana .... it took a while .... only the people who saved American silver .... in mayonaise jars .... buried in the back yard .... escaped the collapse !
Mejicanos and their pinche silver... :p
All you need is "one" fundamental: Economic forcast and revisions for 2015-2028 will be the same "wash rinse repeat" experts gave us on 2008-2014.
http://www.bizjournals.com/houston/morning_call/2015/04/houston-among-to...
And I do think the day will come when the flywheel effect of the energy price drop hurts housing sales here, but I have a friend and a neighbor that sold their houses for more than I thought they would ever bring.
I think of selling my Houston house and just live at work, then go to the Somerville house on weekends.
Same thing happened in the 17th century. The weather kept getting colder and colder. The sun went into a solar minimum and stayed there for 80 years. GDP didn't return for the same amount of time. They had lots of volcanic activity, drought and it was colder than Virgil's hell.
Stack up and get out of the US before it is too late.
You are usually a benign commenter, q99x2. Now becoming predictive?
What kind of question is that? At 1 trillion dollars a year, the cost of maintaining the no-income-at-all, will be unsustainable.
You have to wonder, at each monumental event, if the PTB are not looking into the crowd in order to spot up and coming stars of the undesirables (the middle class) in order to act accordingly. Setting the stage is what they do best.
Stay above the belt when you have nothing else to say; it is the very least you can do. Insulting a person in a public forum as you seem to have done, analytically if you must, is a small man's approach to disagreeing.
Music anyone?
https://www.youtube.com/watch?v=7L1IAIM6e_0
Depeche Mode - Policy of Truth (high road is the road with the least resistance)
https://www.youtube.com/watch?v=kO5qhhsG-Nk
muslim countries are also not productive, and they are still there. So do not worry.
Stock prices are discounting the currency reset that (has been continous) while more is coming......
Silly poster, you only take into account consumer spending that is recorded by the cash registers, not the healthy trade volume occuring during the looting sessions.
The real number will be much higher, and it will even be counted in the GDP several times with the combined powers of Krugman magic and insurance accounting, so everything is perfectly fine.
On the consumer spending something did change.
2008 - All this easy money / credit let's party was a confidence trick programmed into us by the banksters to only get swiftly kicked in the nuts with the debt hangover. You then realise that debt has to be paid.
No kidding you will be trying not to make that mistake again and you see all the temptation as a con job to get you to spend. If anything your target debt is going to be zero knowing it has to be paid back.
So the system can no longer generate confidence in consumers to spend ... THAT IS THE BE ALL AND END ALL.
Now all economic systems are based on consumption at some level and that EXCESSIVE consumption has collapsed and it took 30 years to build it. How you going to get it to that level again when that was the primary growth coupled with easy money for 30 years? TBTF should have been bust, central bank backstop the population to do one thing PRESERVE THE ECONOMIC CONSUMPTION.
In 2009 backstopping the people would have kept the economy functioning and make the banks earn honestly what they could off the punter instead they cut the punter out of the equation so the economy expands by value but the consumers share in relative terms shrunk no longer able to support the economy at todays newly valued level.
SO CREDIT CARD 0, BANK LOANS 0 AND GUESS WHAT I HAVE NO INTENTION OF BORROWING SO FUCK OFF BANKERS AND IF ANYTHING I WILL BE CLAWING CASH FROM THE SYSTEM SO YOU CAN'T LEVERAGE LEND AND INFLATE THE SYSTEM HENCE PRESERVING MY MONEY BETTER WITH THE 0% CURRENTLY ON OFFER.
That path was not chosen by me it was given to me by the bankster manipulation of the economy.
For each and every action there is an equal and opposite reaction and that applies to monetary mechanism not just mechanics.
I'm just glad I didn't wallow in the doom and gloom of 2009, and loaded up on U.S. equities.
The big problem is this ever constant need for 'growth'.
A new car ever year?
Aplliances or furniture every few years as there might be a scratch on yours of you don't like the credit?
Buying groceries on credit? Dang that is a healthy sign isn't it?
Popping pills every day to make you feel better or drinking or smoking pot till you are oblivious?
Constant smart phone triangles when you don't even know who lives next to you?
Lying on resumes so you can get a better 40 hour a week prison?
Sounds like a great life but I don't want any part of it. :)
The tiny little picayune problem that begets all the big problems is fractional reserve counterfeiting and that the collateral that the Treasury pledges when it issues new debt is the direct tax on its citizens.
"Man is free, we say, who exists for his own sake and not another's." ~ Aristotle
Ms Cherry.
U sound like a misinformed, reactionry, envious, hippie with a jones for consumerism.
Let's address your points one by one, to wit:
1) I don't know anyone in my little sphere which spans nearly the entire U.S. parts of Europe, Israel, and Palestine that buys a new car every year. Or every decade. This is a false flag and you need to adjust your thinking and feeling to accommodate reality
2) Furniture, ditto
3) most of my groceries on my platinum AMEX and other cards provides a cash back for consistent use, and I pay my balance off every month. Like most sensible folks, if not paying cash gives youi cash, then you have to be an imbecile to not take advantage of the admittedly small rebate, but little acorns grow into giant oaks.
4) a little vape goes a long way minimizing the pain in my left hip from an injury causing a shooting pain once in a while down to my right ankle. Stoned once in a while, is a good thing, though doing it with alcohol is a unhealthy. Stoned, you can get aches in your belly from a great laugh which is highly therapeiutic and initiates copious bowel movements for the sedentary.
5) U must have known the wrong people or have lived in an awful city that caused you to think that we all live without knowing who is next U. We are experieincing jiust the opposite losing in one month the two golden retrievers that we mothered and fathered for our frequently travelling for business neighbors and now they are moving far away after an association of a decade, good times, and lotsa laughs. Feel sorry for U if you miss no one.
6) resume juicing I can see is the only point I agree with you on.
5 out of 6, ain't bad.
"then you have to be an imbecile to not take advantage of the admittedly small rebate,..."
Used to think the same,,, then,,, I got to wondering.... Do I want everything I eat, and everyplace I buy groceries, every place I fuel up and how many gallons, Every hobby, every movie, every home improvement project, every place I travel and how far, what restaurants I frequent, every place I stop for a drink or two, the times I do all this and whether I take my family and most of all helping them eliminate cash as a means of trade?
Imbecile indeed? Maybe not.
Aside from take out of Pizza at the best place in town, some chinese about 4X a yr. and a restaurant visit 3-4 X a yr. I don't frequent them. Jimmy John's about a dozen times because no one can beat their Number 9 for price, freshness of ingredients, and speed.
Anyone frequenting Chipotle Mexican Grill, and standing in line for a half hour to do so needs their card taken away from them, and a head exam.
Don't stop anywhere for drinks, or two, Travel very little, haven't seen the inside of a movie theater for two years.
Hobbies, working out, home improvement projects are a vital part of life and should not be compromised or subjected to too much evaluation for efficacy, affordability (within reason, possible return of capital on re-sale, and limited to area R.E. values, accessability, terrain, and size of garage).
The value we receive for our Costco card is well worth it, 'cept for the ten dozen bottles of tomato sauces I bought and no longer like, but the Swirl for a 1.50 is the best soft frozen Yogurt treat in the entire world. Worth the entire price of the best card.
Equities will be fine, as long as they're in industries making things people actually need, like food and fuel, and countries whose economic golden years are ahead of them, not behind them. (Russia's a good example. Even much of that China stock boom is Western banksters cashing out.)
It's bonds you should be worried about. Those will be defaulted on or hyperinflated away, no guesswork necessary. Better to lose half your nest egg in stocks than have it in bonds and lose it all.
Call it the Old Mutual portfolio. Going all in on foreign equities is how Rhodesians survived the collapse of the "Zimbabwe" dollar. One of them was Old Mutual, a South African bank traded on the "Harare" stock exchange, which was used to track the value of the Zim dollar day by day.
I am but a micro-example, however items i've sold out of my machine shop relating to hobby interests were selling well a couple years ago. An expensive item that sold once or twice a week is now sitting for a month or longer. Or not selling at all.
In other news regarding inventory builds i've noticed some of the local car lots are expanding inventory by leaps and bounds, renting out lots, etc and soon will be stacking them on top of each other by the looks of it lol.
The two lots I go by frequently are doing the same. One is taking over the open field next it it to park more trucks and the other is parking trucks in the far back lot near the freeway that only used to be used to park new fleet vehicles.
I'm guessing we're going to have the hottest, dryest summer on record? LOL. Cant add tornados...............they already fucked up and made those GDP positive.
Right off the bat U sabotage ur own analysis by using disgraced, useless, ineffectual standards: Fundamentals.
The last time fundamentals were used to assess stuff was in the winter of 1944, and you see how well that worked for the Germans.
"The final Q1 GDP revision was just released and we saw that GDP has again missed expectations"
Ummmm .... the Q 1 GDP was first not final and was nor a revision since it was first. Good grief. Data is fucked up enuff without fuckining it up even more mis classifying it.