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Using Logic, Facts, & Basic Math? - You Are A "Doomer"
Submitted by Jim Quinn via The Burning Platform blog,
“Things always become obvious after the fact” – Nassim Nicholas Taleb

“Facts do not cease to exist because they are ignored.” – Aldous Huxley
The S&P 500 currently stands at 2,126, fractionally below its all-time high. It is now 300% above the 2009 low and 34% above the 2008 and 2001 previous highs. Most people believe this is the new normal. They are comfortably numb in their ignorance of facts, reality, the truth, and the inevitability of a bleak future. When the herd is convinced progress and never ending gains are the norm, the apparent stability and normality always degenerates into instability and extreme anxiety. As many honest analysts have proven, with unequivocal facts and proven valuation measurements, the stock market is as overvalued as it was in 1929, 2000, and 2007.
Facts haven’t mattered, as belief in the infallibility and omniscience of Federal Reserve bankers, has convinced “professionals” to program their high frequency trading supercomputers to buy the all-time high. If central bankers were really omniscient and low interest rates guaranteed endless stock market gains, then why did the stock market crash in 2000 and 2008? The Federal Reserve’s monetary policies created the bubbles in 2000, 2007 and today. There was no particular event which caused the crashes in 2000 and 2008. Extreme overvaluation, created by warped Federal Reserve monetary policies and corrupt Washington D.C. fiscal policies, is what made the previous bubbles burst and will lead the current bubble to rupture.
Benjamin Graham and John Maynard Keynes understood how irrational markets could be over the short term, but eventually they would reach fair value:
“In the short run, the market is a voting machine but in the long run, it is a weighing machine.” – Graham
“The market can stay irrational longer than you can stay solvent.” – Keynes
Graham’s quote reflects the difference between hope and reality. This explains the ridiculous overvaluation of Amazon, Shake Shack, Twitter, Linkedin, Tesla, Google, and the other high flying new paradigm stocks. Story stocks soar because the herd believes the stories peddled by Wall Street and company executives. Five of these six stocks don’t have a PE ratio because you need earnings to calculate a PE ratio. In the long run the market will weigh the value these companies based upon profits and cashflow. It is the same story for the market as a whole. There is no question who is to blame for what now amounts to a three headed hydra of bubbles poised to burst.
The Federal Reserve has simultaneously blown bubbles in the stock, bond, and real estate markets by keeping interest rates at 0% for the last six years, three rounds of QE money printing that created $3.6 trillion out of thin air to prop up the insolvent Wall Street banks, and unending jawboning about inflation being too low as real middle class wages stagnate at 1989 levels. There isn’t a question about whether the bubbles exist, only about how much bigger they will become before bursting again. As John Hussman points out, the financial stability of the world will be endangered when the bubbles burst this time.
“Unfortunately, the Federal Reserve has now created the third financial bubble in 15 years. Focusing on two variables – inflation and unemployment – the Fed has missed the most important consideration: the risk to financial stability. It is the same mistake the Fed made during the housing bubble. This mistake will ultimately end just as tragically. The only question is how much worse the Fed makes the situation in the interim.”
The mouthpieces for the vested interests on Wall Street and slithering around the halls of Congress, roll out their tired storylines about low interest rates supporting ridiculous valuations and corporate profits remaining permanently high because we’ve entered a new paradigm. We’ve heard it all before. Taking extreme risks based upon false economic beliefs, the infallibility of Ivy League educated academic bankers, and delusions of never ending gains produced by Wall Street HFT computers will end in tears for the third time in fifteen years.
The Federal Reserve began lowering interest rates in late 2007 from 5.25% to 2% by September 2008, and then .25% by January 2009. Did that prevent a 50% collapse in stock prices? Did it prevent national housing prices from plummeting by 35% between 2006 and 2010? The main reason stocks bottomed in March 2009 was the FASB bowing down to their masters and revoking mark to market accounting, allowing the insolvent Wall Street banks to pretend they were solvent. The combination of fraudulent accounting, zero interest rates and round after round of QE money printing has propelled this mal-investment mania to epic proportions. Total stock market valuation of $36 trillion now exceeds 200% of GDP. Prior to the Fed bubble blowing era, the total stock market valuation averaged about 50% of GDP.
Mark Hulbert, whose job at Marketwatch appears to be writing alternating bullish and bearish articles to keep the public confused, disoriented, and dependent upon hope and central banker heroine injections, produced the chart below showing corporate profits as a percentage of GDP. Corporate profits always revert to their mean. The capture of our economic system by Wall Street and mega-corporations is glaringly obvious in the increasingly higher peaks in corporate profits since the late 1990’s, as the Federal Reserve has provided the Greenspan/Bernanke/Yellen Put for the reckless Wall Street gambling casino and dangerously low interest rates encouraging corporations to issue record levels of debt in order to buy back their stock, fire workers, and ship jobs to low wage slave factories in the Far East.

Corporate profits as a percentage of GDP have averaged 6.3% over the last six decades. They deviate wildly above and below this mean, with peaks attained near stock market highs and valleys at stock market lows. The current level of 8.7% is two standard deviations above the 6.3% long-term average, meaning it is above 95% of all instances in history. Based on history, what are the odds of corporate profits rising to three standard deviations above the mean (99.7% above all instances)? Not good. They have already fallen from the 10.1% high in 2012.
Corporate profits have been juiced by Wall Street using mark to fantasy accounting, loan loss reserve manipulation, risk free Wall Street casino gambling with free money provided by the Federal Reserve, corporations refinancing debt, suppression of wages through global arbitrage by mega-corporations, government entitlement deficit spending, never ending wars in foreign lands enriching arms dealers, and expansion of the surveillance police state throughout every city, town, and hamlet in the good ole USA.
Over the last six decades, when corporate profits edged above 6.3% of GDP, competition from new companies taking advantage of the high profits would result in price drops and eventually lower profits. It was called capitalism. The Great Deformation created by the Federal Reserve Politburo dictates and monetary machinations have disconnected corporate profits and stock market gains from the real world of everyday Americans. The propping up of insolvent banks and allowing poorly run corporations (Sears, Rite Aid, GM) to survive by refinancing debts at insanely non-risk adjusted interest rates, has delayed the creative destruction that is part an parcel of a capitalist system.
Crony capitalism rewards connected corporations and damages the small businesses which are the true jobs creators. Large corporations don’t create jobs, they ship them overseas. More small businesses are closing than opening for the first time in modern U.S. history. Thank the Fed, the feckless politicians in Washington DC who are about to put a final nail in the small business/American jobs coffin with passage of TPP, mega-corporation CEOs, and the billionaire oligarchs pulling the strings behind the curtain, for destroying a once healthy, job creating economic system.
The game is up. The accounting games are over. There are no loan loss reserves left to relieve. Americans with no wage growth are running out of money they don’t have. Corporate revenues are flat or falling. The Fed liquidity machine has been shutdown. Interest rates are likely to rise sometime this year. A global recession is in progress. It’s only a matter of time before Greece officially defaults. Inflation in healthcare costs, food, rent, and other daily living expenses have sapped the vitality from a deteriorating US economy.
Young people are enslaved in student loan debt, priced out of the housing market, and left with burger flipping jobs as Boomers cling to their jobs like grim death. An economy built upon consumer spending and an ever increasing level of debt has run out of consumers capable of spending and has reached the saturation point of debt expansion. The corporate titans of industry, in a last gasp to keep the party going, are buying back their own stocks at all-time highs to the tune of over $300 billion in order to boost their EPS and goose their own bonuses. The best part is they are borrowing to do so, boosting corporate debt to all-time highs. They would not and could not do this if the Federal Reserve wasn’t incentivizing them to do so with phenomenally low interest rates. These financial shenanigans can’t hide the fact that corporate profits are now falling and will continue to fall.
Mark Hulbert does the usual mainstream media faux analysis and concludes it will take five years for corporate profits to fall to their long term average, resulting in a 20% decline in the S&P 500 by 2020. His assumptions are laughable in their cluelessness about how the world really operates. If he analyzed his own chart he would see corporate profits plunge in a one to two year time frame and never stop at the long-term average. Averages are created by data points above and below the mean. As a corporate media pawn dependent on a paycheck from an employer that depends upon Wall Street advertising revenue, Hulbert couldn’t possibly tell the truth.
Not only are corporate profits as a percentage of GDP near record highs, P/E ratios are also at record highs (excluding the internet bubble when there was no E). The Shiller P/E (S&P 500 divided by the 10-year average of inflation-adjusted earnings) is now 27, versus a long-term historical norm of 15 prior to the late-1990’s bubble. Importantly, the profit margin embedded into the Shiller P/E is currently 6.7% versus a historical norm of just 5.4%. Hulbert’s assumption that P/E ratios would remain constant as earnings fell, is asinine in its concept. That has never happened in history.

The forward 12 month P/E Ratio, which is always lower because stock analyst “experts” always overestimate earnings, is well above the previous bubble high in 2007. This P/E Ratio will also revert to its mean over the long-term. In the short-term, P/E ratios will also plunge well below the ten year average of 14.1, just as it did in 2008 and 2011 before the Fed re-inflated them with liberal doses on QE. With the QE spigot turned off, interest rates not going lower, and earnings already falling, all that is left is for prices to adjust to reality. Everything done by our leaders in government, banking and the corporate world since 2008 has been wrong. They’ve done the exact opposite of what needed to be done to purge the system of corruption, mismanagement, reckless use of debt, and the men responsible for destroying our financial and economic system. The public has come to believe these people have saved us, when they have really condemned us to a future of chaos, turmoil, pain, default, debasement, and war. Time will prove those who used reason to be right.
“A long habit of not thinking a thing wrong, gives it a superficial appearance of being right, and raises at first a formidable outcry in defense of custom. But the tumult soon subsides. Time makes more converts than reason.” ? Thomas Paine, Common Sense
When the tumult subsides and the herd is forcefully converted to reason through an onslaught of reality and the revelation that the Federal Reserve bankers behind the curtain are nothing but academic puppet hacks for the vested interests, the S&P 500 will be back in the triple digit realm. That may seem like crazy talk, but it is simply basic math and reversion to the mean. When corporate profits as a percentage of GDP fall from the extreme 8.7% level of today to a slightly under average level of 5%, and P/E ratios fall from the extreme level of 16.8 today to previous recent lows of 11 reached in 2009 and 2011, basic math shows the S&P 500 will be trading in the 900 range. That would be a 58% decline. For some perspective, it would still be 35% HIGHER than the March 2009 low. So this certainly isn’t the worst case scenario.
Anyone using logic, reason, historical precedent, facts, and utilizing basic mathematics is declared a doomer in today’s world. The sheep would rather follow assertive idiots than an introspective wise person. We are awash in assertive idiots in control of Congress, government agencies, Wall Street, mainstream media, and the corporate world. The psychopathic lemmings will meet their demise in due time. It will be obvious after the fact.
“It has been more profitable for us to bind together in the wrong direction than to be alone in the right one. Those who have followed the assertive idiot rather than the introspective wise person have passed us some of their genes. This is apparent from a social pathology: psychopaths rally followers.” – Nassim Nicholas Taleb, The Black Swan: The Impact of the Highly Improbable
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There was no particular event which caused the crashes in 2000 and 2008.
you can't be serious.
Yeah, and nineteen men living in Afghan caves caused 911 too.
http://tacticstime.com/wp-content/uploads/2013/12/35wse4.jpg
I prefer the term "DOOMIST"
It sounds much more professional.
I've been coming here for years expecting the world to end and gold to be 5 gazillion fiat dollars per pound. Everyday that goes by more people think I've a nut. Soon I'll be the only left that doesn't think I'm a nut.
I wrote on this exact subject a few weeks ago.
Until we can trust my government and financial institutions we must theorize as to how they will react in the future based on the information we have at hand. If this makes me a conspiracy theorist, I’m proud to call myself one.
http://www.debtcrash.report/entry/what-is-a-conspiracy-theory
THE END IS NEAR, THE END IS HERE!!
Biggest # of all seems to get no attention...demographics...it's astounding the trigger for '08 and the reason we can't and won't "recover" is right there...and nobody seems to talk about it. Click the link, check the first chart...mystery solved.
Slowing demand or some such shit. It's all about flow, not stock. And what's more important than the flow (or lack there-of since '08) of new population (declining core populations of consumers, homeowners, taxpayers, etc.). Ramping voracious old people wanting their social safety net.
The data is soooooo clear...but then again it's more fun just to make shit up.
http://econimica.blogspot.com/2015/05/2008-was-tremorwhy-main-event-is-still.html
Added a chart showing the annual change in the 0-24 year old annual US population...which looks to be turning negative alongside the falling 25-64 year old segment. Soft consumer demand solved.
Exactly. Yellen did make some remarks about it at the last press conference but in general it is the major issue that lacks any press attention. Forget having the clowns on CNBC dig into it. They are now a preogressive captured administration rah rah go team outlet.
No, it's a cause identified. It provides no solution, unless you are making an argument for allowing massive immigrationg of young immigrants or something.
Changing demographics, corresponding wealth concentration within the older generation, wealth concentration in general, offshoring, the erosion of public morals because of wellfare ... identifying problems is so easy, providing solutions so very difficult.
A lot of ZH's "solutions" would result in a fascist take over of government and the economy within a decade ... the genie of suffrage is out of the bottle, the class system with fatalistic accepting peons is not coming back in a hurry.
Above avergae trolling here folks. This leads to the conclusion that our overlords are benevolent folks with more understanding than we have. There is a pole reversal, asteroid, demographic collapse, blood moon coming and there is mothing we can do to prevent massive loss of life so we are doing our best to save those we can by centralizing all power and productive assets...meme.
Nevermind that population reduction through any means possible (orchestrated economic collapse, gmo food, vaccines, death panels, weather modification, water supply poisooning via feacking, war, etc) is the benevolent elite's ultimate agenda..
Another reason they are flooding the US with illegals.
Or you could go with Doomsayer, if you prefer a D&D feel.
This country IS doomed. The progressives (communists) have wormed their way into power on every level with promises of free shit, godlessness (they think that's a good thing), "equality", and general brainwashing. And make no mistake, they are just as bloodthirsty as Lenin, Mao, or Pol Pot. Why do you think they want to disarm us?
Fortunately, paranoid schizophrenia is (somewhat) treatable.
I wouldn't describe Zero Hedge as a "doomer" site, but rather as a "perma-bear" site. This is being compounded by the presence of a vocal minority of right-wing extremists on its forums, who seem to actively wish for things to fall apart for reasons I can't grasp.
Pretty clear you're a fuckan idiot if that's what you think ZHers are.
Well generally if you have no tits, but you do have clevage, you have a problem, your currency is about to collapse, being in denial about it don't make things better.
You, like all progressives, are a left-wing extremist who represents a nano fraction of ZHers. You can't grasp why we want things to fall apart because you are halfway home to your commie utopia! You want to outlaw Christianity and disarm Americans don't you? Admit it! Unfortunately for you and the rest of us, your insanity is terminal.
You've sunk deeper than hell my friend, lets rendevous on MV.
Fatigue is one easy-to-identify reason for this.
Bear Stearns was 'murdered', but, of course, that was a non-event. Lehman was directly in the cross-hairs as soon as Bear Stearns went down, but, of course, that was a non-event too. And when Lehman finally declared Chapter 11 that was a non-event too. Frankly, I agree with everything Quinn states except that statement above that states 'no particular event caused the crashes'. Moreover, given that you spotted Quinn's egregious error in logic it is abundantly evident that you have one up on him IMHO.
He is also clueless and in denial on 9/11. Sadly, Quinn has some glaring blindspots.
"You cannot win if you do not play" old carnival huckster come on...
...It's 1984!
Being a Zero Hedge regular surely makes you a doomer and a conspiracy theorist.
Not to mention, a prime NSA target.
true dat hommie!
Dude! Haven't you heard? That NSA law didn't get renewed and the days of unconstitutional snooping have ended!
It's dawn in Amercia once again.
When is the parade scheduled for again?
I can see your dangling participle.
Mark Hulbert- Master Bullshitter- the rest of us are mere amateurs.
Anyone got a coolaid?
I gotta change my water.
i refer to my self as a realist, aka tin foil hat wearer.
I got told by somebody a couple weeks ago that calling yourself a 'realist' just means you're a pessimist who doesn't want to admit it to everyone.
For what it's worth, I was deeply offended, but he did make me think. Hard to get a comment like that out of my head.
i'm optimistic the stock bubble will burst soon.
I tell people I meet, "who knows what's going on so why worry about it.."
They ALL like that a lot better than any facts or concerns..
Ignorance really is bliss.
People say that I'm paranoid- but I'm not. I KNOW they are out to get me!!!
I prefer the term 'Critical Skeptic', because I am critical and skeptical, esp. of sociopaths!
Paranoia is just a heightened sense of reality.
Mental laziness not stupidity, like Einstein said, is the greatest commodity on earth. That's probably what he meant, but was too lazy to say it!
Ignorance breaks the law of supply and demand by being both abundant and expensive
Did you respond with the fact that eternal optimists are delusional sycophants who allow the corruption because they choose to ignore facts in their pollyanna world? I like to think of myself as an optimist who recognizes the fact that we live in a fucked up society.
I like to think of myself as an optimist who recognizes the fact that we live in a fucked up society.
Truth. Right. Here.
There's nothing wrong with being a pessimist. Optimists are either delusional or ignorant.
Hang in there ND. Being a realist does not mean you are pessimistic, it only means that you are running against the herd... something you will be thankful for later when the herd is slaughtered.
I have had the same doubts and fears my friend, many times when it seemed like I was a sole outcast, when my friends and aquaintentences would snigger, point and say "there he goes again..." lol. ;)
I was raised by my Depression-era grandparents. And in the current times, I am very glad of that. It's stood me in good stead.
If you know anybody who actually lived through the Great Depression, you should talk to them. Now those were REAL optimists. They actually believe they could make it through the tough times without starving or freezing to death, fight and win a world war against techonogically superior enemies and then proceed to build the greatest middle class the wold has ever seen.
Real optimism can't survive without success to back it up. I see little to be optimistic about in the macro landscape, when framed in those terms.
I have great optimism in my own personal success. I can climb the mast faster than the boat can sink out from under me.
“In the long run, we are all dead.” Optimistically, it will come in your sleep!
Realistically, it doesn't matter what he thinks. The pessimist in me thinks he'll be dead within 5-10 years anyway.
"realist' just means you're a pessimist who doesn't want to admit it to everyone"
Pessimist = informed optimist. Got that from a very wise man.
Labels are created by the dark arts practioners [PR firms] for the purpose of creating positive or negative connotations among ideas or like minded thinking.
In other words, there is a label with negative connotations for everything the ZWO hates.
-Goldbug
-Doomer
-911 Truther
-Conspiracy Theorist
-etc.
Time to get wise.
Hmm, all of those sound better than the alternatives...
-Rube
-Victim
-Sucker
-Denialist
I call all those that look at my Stacking efforts as "butbut's".....because when this thing pops all you will see are sheeple walking around going ..."But....But..."
So, I have a question. What's the right P/E ratio supposed to be in a zero interest rate environment?
<crickets>
That's right. Even insanity is CAUSED by something, just as massive events are CAUSED by something. It's just that cause of insanity can usually be determined (hint: rhymes with The Fed), though the exact point when the wheels fall off may never be explained.
03/00 - ffr = 5.5%
00/00 - market top
8/07 - ffr = 6.25%
7/07 - market top
there is no market there is only the fed
'08 to present, the US Full Time work force declined by -700k (ie, those financially capable of becoming homeowners), 25-54yr/old employed population declined by 3.7m and total 25-54 population fell by 1.2m...but the US added almost 5 million new homes over this same period while the population replacement rate fell well into the negative (1.86 and falling).
Discuss...
http://econimica.blogspot.com/2015/05/2008-was-tremorwhy-main-event-is-still.html
That's why it's best to stay under radar and be a lone wolf.
Yes, but a lost loney wolf?
Who knew that the central banks would be buying the world stock markets? Ask yourself why they are doing this when their mandate is not supposed to do anything with the equity markets. Who knew they were buying? The corruption and manipulation is so ingrained into the system that no election will ever bring us back to normal.
Not only do you have the central banks buying the markets, but all these companies buying back stock. Every central bank purchase is just like a buyback because they will most likely never sell because they don't mark their balance sheets to market. Lie on top of lie and no one around to enforce the rule of law...............
Yeah, they are being run as sovereign wealth funds when their mandate only ever applied to currency and interest rates. Building a "properly diversified global invetment portfolio" was NEVER what they were charged with doing.
That's how you know they're shitting a brick right now. It's also how you know that the value of the stock market in most developed countries is just a policy tool (h/t Dr. Engali for that line). And it's how you know they're preparing for the end game, by buying direct claim on the productive assets of the country, knowing the currency is going to shit at some point in the not-too-distant future.
Hmm, maybe if markets crash it will be easier for them to buy up the rest of the markets so they are the sole owners of everything. It would certainly take less ink or bits/bytes.
Continuing the theme above: The realist in me thinks they will ultimately fail. The pessimist in me thinks they will try so hard that the planet loses a high double digit percentage of human population.
"what goes up must come down" Hmmmm? Will it be the S&P or ground beef first?
The Capital of Europe would appear to be Kiev right now not Brussels.
Spin at max signals sheer desperation. It's sinking fast now.
"Maybe the U.S. economy isn't tanking after all:
Don't believe all of the economic gloom and doom.
Yes, the American economy ran into some rough seas during the first quarter, with growth grinding to a halt. On Friday, the government is set to release revised data that could even show the economy contracted in the first three months of the year.
But here's some good news: A rebound is under way. A bunch of indicators released in recent days offer hope that the first quarter was mostly just weather-fueled turbulence and the result of other temporary factors.
"I think growth is bouncing back after that weak first quarter. Things are looking much better for the second quarter," said Gus Faucher, senior macroeconomist at PNC Financial.
While evidence of an economic rebound concerns Wall Street because it could speed up the Federal Reserve's first interest rate hike in nearly a decade, it should be reassuring for everyday Americans.
Housing rebounds as weather improves: The renewed confidence is being fueled by upbeat reports on various sectors of the economy. For example, home building ramped up big time in April. The government said housing starts surged 20.2%, marking the biggest increase since 1991 and returning activity to pre-crisis levels.
That impressive number is a key piece of evidence bolstering the case of those who believe first-quarter growth was chilled by severe winter weather.
Likewise, a report released this week shows that new home sales ticked higher in April and the median price of a new home rose for the first time in five months.
Businesses, consumers bounce back: It's not just the real estate market showing signs of life. Even business investment is looking stronger. Orders of non-transportation durable goods rose in April, marking the second consecutive month of increases following a recent slump.
"Business investment, one of the key elements of the economy, is coming back," Brad McMillan, chief investment officer at Commonwealth Financial Network, wrote in a note to clients.
Consumers may not be spending much, but they seem to be feeling pretty good lately. Thanks to the stronger jobs market, consumer confidence ticked up in May more than economists had predicted.
"Consumer financial health is in very good shape. I don't think there's any reason to believe the American consumer has become a saver rather than a spender," said Russell Price, senior economist at Ameriprise Financial."
http://money.cnn.com/2015/05/27/news/economy/us-economy-rebound/index.html
Wow, that makes Stephen King look like someone with a lousy imagination..
That CNN with their staunch, fact based reporting.
You have to be some kind of dolt to Ctrl+P that mess with no sarc tag.
I haven't looked at these for a while, so the numbers are low.
CNN is probably talking about Foreign Investment in the USA.
http://research.stlouisfed.org/fred2/series/ROWFDNQ027S ($3.3 Foreign Investment USA)
http://research.stlouisfed.org/fred2/series/GPDI ($2.9 Private Domestic Investment)
http://www.bea.gov/newsreleases/international/intinv/iip_glance.htm
http://www.bea.gov/newsreleases/international/intinv/iip_glance.htm ($31 Trillion foreign compared to $24 for US) (This is very interesting as Big Banks are growing strongly, but the number of total us banks is dramatically decreasing, like someone is gaming the system, Commercial Banks in the U.S. - FRED - St. Louis Fed)
These low GDP Numbers, Low Consumption numbers, and low Velocity numbers are appearing in an Environment of No Federal Budget in 6 years since the Crash in order to facilitate Fiscal Stimulus.
That is the only Explanation for the huge Explosion of Federal Budget from 2002 and then even when the wars end the Spending is at levels of like $3.5 Trillion a year which should be "Turbo Charging" the Economy.
But no. GDP is anemic. Velocity at record Lows. Credit to GDP Still in Bubble Territory for 12 Years.
molon labe
Notice that Putin & Merkle are like Royalty?
Merkle took here party in 2000, then was elected Chancellor in 2005 for 4 year term, now 10 years as ruler.
How very Royal.
British Empire was a Trading Empire where the people were so poor they became Criminals and Prostitutes in the streets partly being deported to Australian Prisons. But their British Free Trade Model is what has been Adopted by the USA and EU. And the London Financial Model of anything goes has been adopted by Wall Street and Washington DC. After WWI Britain decided not to Rebuild it's Factories, but to use Trade since it had no use for a Middle Class. Fast Forward and the world saw a miracle in the USA, a Vast Middle Class had appeared partly carried by great Distribution systems of highways and trains and produce from overseas through ports. Today we are dissembling the Middle Class after Disassembling our Important Industries. It seems that US Labor Rate had become too high.
How Royal and Heartless and brainless to ignore the value of the US Consumer Market Created with the Middle Class.
Welfare and War are a poor substitute for Government By the People instead of Monarchs.
Does that sound like Doom??
What about Royals Manipulating the Banking System with Fixed Markets in order to protect the Systemic Fraud, Money Creation, Credit Bubbles for Corporations Profits. Well not just the Corporations and Their Private Executives. There are also careers for those that bribe and manipulate our Politicians and the politicians themselves who are getting rich by harvesting our Resources for their own Gain.
How Very Royal it is of our US Leadership. How Heartless.
I prefer the term REALIST.
I mean you are presenting reality based on facts, figures, and real world observation. Yet somehow you are called wrong.
I've said it before but I will never forget when my economics professor said I was right, but for the purpose of the class I was wrong. Only in economics and politics can facts not matter and fantasy become reality. I mean if I seasonally adjust my wife's cup size on paper it doesn't appear in the bed room.
The Skyscraper Effect: Certified to DO Nothing, but Theorize
Empire money is redeemable for inflation, natural resource discharge for entertainment, that’s it, which is why the Fed’s primary concern is the sustainable rate of inflation. If labor does not actively discount money by the character of the holder, the empire has no brake and no regeneration, because empire data collection is self-serving. And without traction, the only possible outcome is economic discharge.
Money, arbitrary assignment of debt and credit, with tax redistribution as feedback, creates an uphill slope from the bottom and a downhill slope from the top. Interest rates have fallen for the top and the middle continues to discharge, because the empire infrastructure it depends upon is collapsing, in a positive feedback loop with climate variability. Capital has a low rate of reproduction, and the middle class reproduces in waves, in reaction to media, in denial and anger, feeding capital in both directions, with the artificial variability.
Silicon Valley’s population gain has cost California and The Nation net, with global real estate inflation, and it is the prototype being reproduced, a Cloud targeting producers, underpinning global finance. Technology, driven by Fed margin leverage, for entertainment, surveillance and weaponization, is the same sh-show that’s been going on for thousands of years. The empire has always been data dependent and has always ‘thought’ that its knowledge, superstition, is power, seeing only itself.
The H1B1 program is about neither talent nor skill, and is all about maximizing rent relative to income, at the expense of the current middle class being liquidated, which is still buying its crap with increasing time, expecting labor to pay the bill, which clearly isn’t happening. Last time I checked, arbitrary assignment of debt and credit with casino code, to grow the feudal extortion racket, isn’t a skill.
As labor exits, the middle class falls, raising less capital, with a smaller motor and no brake, fewer people showing up to work in a workplace where the objective is to avoid work with make-work, efficiently replacing the latter with consumption technology. Government is not production; it’s a derivative, which becomes a problem posing as the solution, for those seeking the path of least effort over the greatest time.
It is always the end of the world for some DNA population. Measure investment in terms of your time, not empire money, which consumes time, as a derivative chasing its own tail. Life is not a competition to see who can fit into the smallest box with the biggest TV. Avoiding work with make-work makes a great deal of sense, until the obvious can no longer be ignored.
Trump Tower exists because the majority chooses to believe that something for nothing is the basis of economics, that an individual investor cannot outlast an irrational market, and that peer pressure rules something other than itself, no matter how stupid, patriots and tyrants, gravity employed against itself, constantly rewriting History to suit themselves, a process which is in no way exceptional.
Empires are brittle, and spend all their time trying to prove otherwise, to themselves. As always, now is the time to make a market, but beginning with false assumptions about labor is not going to produce a different result. Capital is welcome to the penthouse, in an ivory tower, with mirrors for windows, and the middle class is welcome to chase it, raising it with growth from the bottom, as the foundation disappears.
The day is never going to come when government can raise children to be productive, but that never stops the majority from pretending and extending. Don’t enter the workplace, demand equal treatment, and take labor’s children to extort the outcome, expecting no response because you can’t see it, until it’s way too late, when capital is rolling over the overhead.
Capital competes with nature, for dominion over the middle class, which hides from nature, empire after empire after empire, a false choice, expecting a different outcome. Rule of Thumb: Don’t talk to others about your marriage, except those who are married to raise children, who will tell you that the only path forward is faith, which is based upon individual experience, trust.
Family Law is just a common completing the circuit, transferring wealth from marriage to the feudalists mimicking marriage. If you have current in there, you have a problem. The State Church demanded a license at the cost of its own destruction. The King didn’t replace married priests with eunuchs by accident, and their derivatives are no taking over the churches now by accident.
Don’t consume poison and expect a good result. Ponzi entitlement duration is only a problem for the feudalists who see it as the solution. The multiplexer bridge opens and completes a circuit. From the perspective of G, the Fed is the motor and the critters are trying to replace it before it fails, competing to see who can further increase rent relative to income, selling a rapidly growing inventory of empty units to each other for the purpose.
You choose whether growth is economic or inflation. There is always an empire being born and an empire dying. The critters employing children as pawns, to extort labor, are in the dying empire. When they choose to recognize prisoners dilemma depends upon them, when their pain exceeds their fear, which is what all those drugs are about, maintaining fear at scale, until their fear, Nature, can no longer be ignored.
The sad fact is that government is the majority, including corporations, which compete to print money for consumption, and complain about Government, which is no recipe for economic mobility. Your priorities, in order, are your spouse, your children, your boss and your landlord, and the majority wants to be your first priority, as your landlord and boss, maximizing rent to income for redistribution, building monuments to their political machine, calling the process History.
Funny, how empire contracts are dependent upon ponzi entitlement promises, which never come true, and are conveniently forgotten by the majority shortly after origin, which always expects labor to pay the freight, in the form of declining living standards for children, which the feudalist see as competition and expendable pawns, feminist democrats keeping abortionist republicans busy, preemptively disabling an ill-perceived opponent, itself in the mirror.
Don’t pick on your children and wonder why the end up in rehab, which doesn’t work. There’s no shortage of that in the empire. They need a sanctuary, and public education isn’t it. Encourage them when they are productive and leave the rest to God. Capital never stops, for the middle class chasing it, to belong in a cave.
If you are looking for positive feedback in a quantum economy, all you will see is a black hole. California is not the problem. Proposing anything coming out of the Nation/State as a solution is the problem, which is a problemsolution for labor. Most old-timers fought an irrational system to get their positions, and they are not going to give them up for entitlement babies, both of which are stupid attitudes, leaving the rest of the kids in a mine field, and there is nothing the Fed can do about it.
WWII took 6 months to win, installing new equipment, and it wasn’t worth that. Trillions of hours spent on Internet development over decades, one step forward and two back, subtraction by addition, and Public Education, monkeys burning down their own economy, while apes watch from an ivory tower on the other side of the river, always expecting another round, has changed how?
Autism, vaccination from nature and DNA deficiency, is an empire staple.
Fuckin' eh, Bubba, but don't forget that some people in this World prioritize based on their own life in opposition to the so-called 'majority' that only thinks it rules all of the people all of the time when in fact it is presently ruled by empirical rule and not their warped notion of logic over time. Reality is knocking on the collective doors of the European Union as we write here, kevinearick, and Greece is certain to exit the Empire shortly. A Brexit is also slated to manifest rendering the EU Empire defunct as soon as they do. And that means that World War Three is certain to follow soon after.
--Arthur Schopenhauer
When I was young I was an optimist. Now they call me a pessimist. I don't think so. I'm just an optimist with experience.
I really don't give a shit what they call me. This fucking ship is going down.
If the evidence does not match your facts, you may not have all the facts.
All this gloom and panic ignores the real Fed and Bernanke/Yellen's real logic.
Sometimes you've got to work backwards from the evidence to deduce the "facts".
There you go again, Jim Quinn, speaking truth to power!
? You may sa-a-ay I'm a "doomer"
But I'm not the only one
I hope one day you'll join us
And the world will think as one
Actually it is even worse than Mr, Quinn assumes.
The Fed always know what they are doing, because they set policy. ( Or at least they implement the policy the are told to implement.) And the only hope we the people have for regaining a semblance of freedom from absolute submission and slavery is another world power that is equal to the task of taking on the establishment of today in what would be a fight to the death a la WWII. And that the above mentioned ' other world power' would have more altruistic motives towards ' we the people'.
My take is that even they ( with maybe the exception of North Korea and Iraq/Iran) are part of the same 000000001%' ers, and despise their populations just as much or more than our dear so called elected leaders of our doubly so called democracies.
Is that pessimistic, I mean realistic enough for you?
I don't particularly like quoting Federalists for positive effect, but...
"Facts are stubborn things; and whatever may be our wishes, our inclinations, or the dictates of our passion, they cannot alter the state of facts and evidence." - John Adams
I don't particularly like quoting Federalists for positive effect, but...
"Facts are stubborn things; and whatever may be our wishes, our inclinations, or the dictates of our passion, they cannot alter the state of facts and evidence." - John Adams
Why can't I use GPS to track any flights over the South Pacific Ocean?
Does that question earn me a tin foil hat?
I bet anyone $100 Bitbytes if you can show me just 1 flight over that area, at any time of day?
"then why did the stock market crash in 2000 and 2008?"
What a fucking STUPID QUESTION!!!!!
Obviously it did not crash because the Fed was not stepping in with plunge protection bidding it right back up the minute it starts to falter.
And as is obvious --- they will continue to run the presses as hot and long as necessary fending off any fool who shorts this heap of shit.
Of course that cannot go on forever.
But what's the point of even bothering to try to time the pushing on a string phase?
We are so fucking many miles up in the air that Everest looks like a bloody ant hill.
When this fucker goes if you are on the sidelines there will be NO buying opportunity. There will be rubble.
If you are short just as it flips over you will collect sweet fuck all.
This is the Great Depression on herion, HGH, steroids, crack and speed.