IceCap Asset Management March Perspectives: "I Need A Job"

Tyler Durden's picture

From IceCap Asset Management March 2012:

Just as Mr. Greenspan had a conundrum, so too does Mr. Bernanke. And just as Mr. Greenspan completely misunderstood his conundrum and how to address it, so too does Mr. Bernanke.

Mr. Bernanke was very clear that his conundrum is the job market. The reason his brow has become furrowed is due to the eternal question of whether the lack of a strong recovery in jobs is cyclical or structural.

Now since most people live in the real World, this concept of cyclical versus structural falls on deaf ears. However, it’s actually a very important concept for you to understand and it could even save you a few bucks in your portfolio.

Cyclical simply means the regular ebbs and flows of a market. Think of your daily commute to work (if you have a job) – some days are longer, some are shorter but in general they are quite predictable.

Structural refers to the underlying foundation and how it supports the system. For example, what happens if suddenly in the middle of the night the bridge everyone uses collapses. Suddenly your commute has become a lot more complicated and will remain complicated for a long time.

In the real World, 6 million people had their bridge collapse and lost their jobs. Yet, in Mr. Bernanke’s World this cyclical inconvenience could easily be fixed simply by cutting interest rates to 0%, spending billions on “shovel ready” projects, and cutting taxes. Sadly, a funny thing didn’t happen - the usual boomerang (or cyclical) rebound in new jobs has not occurred, and for some strange reason the collapsed bridge hasn’t been replaced either.

The high levels of employment reached during the 2004-2007 period were achieved on the backs of the housing and debt bubbles. During that time, economic growth was boosted by 400% as a result of people taking equity out of their homes (mortgage equity withdrawal). Considering no one has any equity left in their homes to withdraw, economic growth and the jobs that come with it are going to have to find another adrenalin shot. If you know the next big thing – feel free to share it, the World needs it.

Full note:


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Colombian Gringo's picture

I suggest that we nationalize the FED and declare all debts null and void. That will solve the debt crisis immediately

Future Tense's picture

There are rumors that are growing stronger that the government is considering wiping away some of the student loan debt. They will probably wait until it becomes more of a crisis. It is amazing that citizens of Spain cannot walk away from debt owed on real estate like here in America. This article provides a strong analysis of the most recent data out of Spain, including the bond levels that need to be sold in 2012.....

CompassionateFascist's picture

The real unemployment rate - new to the job mkt/can't find work + out of work/on benefits + out of work/off benefits = c. 25%. Volatile youth cohort: 50%. Black/Hispanic youth: don't ask. To intensifying race tensions, factor in the IranWar (starts late August/early September) + oil price spike/dollar collapse + election, and there's more than enough cultural, economic, and political tinder for Civil War. A single spark will start a prarie fire. Invest in lead.  

Cursive's picture

@Colombian Gringo

Jubillee?  I support some version of this plan.  With this much debt (and I'm a saver), the only other solutions are default or repudiation.  That which is not servicable will not be serviced. It sucks, but there will have to be some consequences for deadbeats.

Doña K's picture

We are at a point that labor costs have come down enough and if you were to deduct transportation costs from Asia to the US, we can gear up producing stuff here. Usefull stuff that is. Not Junk.

Thus, if Bennie and the Inkjets had any brains, they could influence congress to go on a bring jobs home spree by increasing import duties. by giving tax incentives for new factories (big and small) and get the union leaches out of the picture.

With organized labor to carry the lazy and the unproductive, to buy political favors and to push for unrealistic wages, the US is toast.

Sometimes, the truth hurts, the truth is bitter and many people can not handle the truth.

We have all seen the hair raising performance of Jack Nickolson. If that does not move you, you are a dead man without feelings and or ideals.

For those who have not seen it, here it is once again.


AnAnonymous's picture

We are at a point that labor costs have come down enough and if you were to deduct transportation costs from Asia to the US, we can gear up producing stuff here. Usefull stuff that is. Not Junk.


Sure, sure.

Homeless working as human wifi tower: payday expectation:20 bucks.

People working in Amazon delivery sweat shop depot: $60 per day, taxes removed.

Labour cost can not fall beneath Asian and other parts of the world as a result of Smithian economics.

Smithian economics leads to concentrate wealth on certain areas by transfering it from other areas.

As wealth is concentrating on one area, this area grows automatically more expensive to live on.

That labour cost arbitration thing is a pipe dream. It can not happen.

The US of A keeps concentrating wealth (as a normal expectation due to finite earth), meaning living in the US will grow always more expensive.

Bernanke and co know this. That is why they engineered the housing bubble: to provide US citizen middle class with an inventory of houses they could not have bought otherwise.

wee-weed up's picture

There will have to be some consequences for deadbeats?

Ha! Dictator Obama turns up his Mussolini nose and scoffs at your ridiculous attempt at humor!

bigkahuna's picture

The problem that no one sees is that the consequences for these "deadbeats" will not be very humane at all. There are entire classes of these government dependant types as well as simple debtors who are going to find themselves at the mercy of something very nasty - systemic austerity, basicly instead of that welfare/unemployment/you name it check from the feds/state - people get nothing, and debtors get their house/car taken by a financial istitution that would rather have your house or car than a worthless debt secured piece of paper.

No one sees this coming? Are we blind? How many white elephants have to plop their arse in our living room before history looks back on us as a bunch of outright morons!? 

hooligan2009's picture

Governments are about to default across the globe. It makes no difference if the debt is cancelled or defaulted. Investors in governmnet debt are living in cloud cuckoo land if they think they will get any money back in five years time. The meteor will impact the earth despite the efforts to blow it up before it hits. No state pensions, no benefits, nada. Fiscal tsuanmis on impact.

the 300000000th percent's picture

Sounds great but I believe that would start a war with China

Marc_W's picture

I believe that the plan is to extend debt as far as possible over all of society such that we are nearly all "sinners."  Let he who is without sin cast the first stone.  There will be few to cast that stone, if my analysis is correct.

So I have decided to abandon my prudent life of living within my means, saving, and "doing the right thing."  I paid my federal taxes this year with a credit card.  That credit card will never be paid off.  I will be living on credit for the next year or so, and I intend to live well.

The system is irreparably corrupt.  Trillion dollar bailouts for the banks, and life crushing austerity and debt for the serfs.  Everyone's scamming someone or something, and the few of us that live within our means and pay our debts are nothing but suckers in this game.

I will no longer be a sucker.

Colombian Gringo's picture

Just Kidding. Really, we are so Screwed.

noob's picture

Uncle Remus: Wir sind also geschtupped.

Translation / So we are geschtupped (schtupped? - screwed).

DormRoom's picture

Remember in the 90s & 2000s when all the manufacturing jobs were being exported overseas, but the economy didn't shrink, because of the credit/internet/housing bubble?


That's the source for our structural unemploymen.t  All those manufacturing jobs were outsourced under the cover of credit expansion.


Well, that credit bubble popped.


Now, millions in the labour class are jobless, while the rentier class are richer than ever!

Mary Wilbur's picture

They started exporting manufacturing jobs overseas back in the '70's.

Yen Cross's picture

 Under Employed?   T --__  __    Barka lounger! 

Rynak's picture

I don't think greenspan or bernanke did/do misunderstand anything. They just don't give a damn. They have other priorities.

Moneyswirth's picture

Well this was depressing.  We are truly and seriously boned.

X.inf.capt's picture

this is a total SHOCKER!

but then again.....

the most  abundant sign  on the front of small businesses in my town is....


jobs? what jobs? to have jobs you have to have businesses!

or a really big war.....

lolmao500's picture

Who cares... the sheeple are gonna start a race war...

New Black Panthers: Race War For Trayvon April 9th 'Day of Action'

Goddamn fucking fools!!!!!!!!!

wee-weed up's picture

Starting a race war may be Obama's only last hope for trying to get re-elected.

lolmao500's picture

It's not about Obama. Obama, like Romney, is a puppet. It's a distraction to redirect the anger from the banksters (occupy wallstreet, Ron Paul supporters, anti-war activists, pro-constitution groups) to each other (between races, classes)... it's all a big distraction so the criminals don't get punished.

If this wasn't the case, the MSM and politicians wouldn't be going out of their way to promote this race division bullshit and the FBI would be rounding up the New Black Panthers right now. But that's not what they are doing.

/got militia?

wee-weed up's picture

I think you've missed the forest for the trees. Wise up. Look at what is happening all around you...

For Obama, Holder, and their band of race pimps and hustlers (Jesse Jackass, Al Sharpton, etc.) it is ALL about race. And their lap-dog PC MSM are only too willing to help fan the flames in order to sell the "news." Example... the doctored NBC Zimmerman audio tape. 'Nuff said!

lolmao500's picture

I'm just saying. All these people you mentionned work for the banksters, they are useful puppets. They are pawns.

LowProfile's picture

The vast majority of black people aren't anywhere near stupid enough to start a race war.  Those that are will be dealt with quickly.

lolmao500's picture

I know. Hell ``black people`` are just like any other Americans... they want jobs, a good education for their kids, live a happy life, be free, the corrupt politicians and banksters to go to prison. Only a minority of extremists (on all sides) want a race war because they are useless idiots.

The big goal of the elite with this made up crap is : divide and conquer so the country can be fully bankrupted, the country put into martial law and guns taken... then it'll be mass genocide Stalin/Mao/Hitler style.

AnAnonymous's picture

The big goal of the elite with this made up crap is : divide and conquer so the country can be fully bankrupted, the country put into martial law and guns taken...


No. In US citizenism, the middle class is the king class.

Divide and conquer? On what ground? The US People chose its divisions a long time ago.

It is by popular will. Poor have a low vote turnout rate in the US and the rich can afford buying legislators.

The US citizen elite manage the various moods of the US citizen middle class.

Racism is central to US citizenism. US citizens reap a lot from racism, a rather profitable origin of their prosperity.

US citizen elite have nothing to do when it comes to racial division as US citizens chose since inception to thrive on it.

bigkahuna's picture

Your perspective belongs on MSNBC or CNN. Go and interview for a job, they will hire you quickly.

Moneyswirth's picture

For what it's worth, SP futures down 15 points, Asian markets red.  

Money Squid's picture

Hey hey hey hey....don't be treading on my avatar man.

Marc_W's picture

His name and avatar are both better than yours.

KickIce's picture

In other words, government has run out of bubbles to inflate.

NoClueSneaker's picture

Nah, there's brand new machinery that spies the sheeple. How about the tax on unproductive fuck ?

Each time someone fucks his wife without the intention of getting her pregnant, ( terrorist activity ),  owes $20 to the IRS.

If you try to avoid the tax with wanking, DHS deploys an SWAT team to force you to fullfill your patriotic duty.

Just an idea.  ( Derivatives even more exiting ).

Marc_W's picture

No.  The fascism bubble isn't even half way inflated.  What do you think all those TSA jobs are about?  The ever expanding security state?  Fascism is the next bubble.  That and more wars.

carbonmutant's picture

What a coincidence, I've always felt that trading in the markets was like driving in traffic.

Cursive's picture


If you know the next big thing – feel free to share it, the World needs it.


Debt counseling (cue rim shot).  Seriously, this is a generational thing.  Developed countries have started aging massively and prior to that the populations of the developed countries accumulated mountains of debt.  Japan was first.  Why didn't the internet revolution completely transform the Japanese economy for the better?  

mckee's picture

Screw your debt counseling .... I'm long Skylanders!

bankonzhongguo's picture

You have to actually make something besides debt in order to have a real economy.

Amazing how primitive the employment calculations are, when the same super computers that listen to your phone calls and copy your email could simply be switched on to log official employment per SSN.  Its like a monkey trying to fuck a football.  Get ready to have your IP address become your cell phone number and employment ID.

Funny how many times the same SSN is used by illegals to get free money and democrats votes.

Never-mind that a "job" today does not have the earning power of a job in the 60's.

You want to know how the economy is doing?

Walk out your front door at 7AM and count the cars leaving driveways for the day.

88 million not doing too much these days - except selling grandma's china on eBay to pay the cell phone bill.

The country is one big garage sale.  10 cents on the dollar in order to buy a happy meal and a mocha.

Just remember its the banks.  The banks.  The banks.

And the wild beasts that ran the country into the ground for fun and profit.



i-dog's picture

Jobs? We don't need no stinkin' jobs!! We've got da gubmint to take care of us!

Ben'll fix it...he's got a printer...he's an expert on depressions...he really cares about his people--er, I mean, us people...just you wait and see....

Red Heeler's picture

The next big thing? Default. What happens if thousands, tens of thousands, or even millions decide, out of desperation, to default en masse?

Marc_W's picture

I've actually decided to go that path.  Run up $50K or so in credit card debt then refuse to pay and leave the country.  What's my FICO score gonna matter on another continent?

Spitzer's picture

cant even get a gold bubble going...

Mining stocks are in a bear market

Yen Cross's picture

 FUCK CHINA !     SANS 'Barbra Streisand", South Park Godzilla ,          FLOAT the " YUAN"!

Seasmoke's picture

the next great thing ......Barter