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Is Keynesianism Running Dry?

Tyler Durden's picture





 

Via Perspectives from Pictet,

Why policymakers must be brave and innovate with economic policy

Even though the policy mix is extraordinarily stimulating, developed-world economies just cannot embark on a virtuous circle of recovery. Worse still, governments, whose finances have been bled dry, are powerless to boost demand. This all suggests Keynesian policies have failed. A fresh approach to economic policy is needed. But policymakers will need to be both bold and brave.

The current state of economies is serious and worrying: although deliberate expansionary policies have been pragmatically implemented since March 2009, governments and central banks throughout the developed world have been unable to push recalcitrant economies back into the virtuous loop of self-sustaining recovery. The implications are plain for all to see: once governments apply a brake to public spending, growth slows considerably. Economies of the developed world have become addicts, ‘hooked’ on government spending.

The annualised rate of US economic growth has slackened to no more than 2%, down from 6% in Q2 2009, in spite of the mix of reflationary fiscal policies and the US Federal Reserve’s unprecedented quantitative easing. Europe’s economies are heading for recession, crippled by draconian budget austerity in many countries intended to redress astronomical public-sector deficits and national debt. Worst-case scenarios are pointing to Europe’s GDP shrinking by 2% over the coming 12 to 18 months. This calamitous failure of economic policies will have serious social, political and, self-evidently, economic repercussions.

Keynesianism running dry

Both US and European economies see jobs being destroyed once growth slows below 2%. If recession bites, obviously jobs are wiped out on a more massive scale and household income shrinks. Unemployment and contracting income penalise social well-being in developed nations: the number of people living below the poverty line is rising non-stop. Although this stratum of society was considered just a marginal fringe twenty years ago, it now accounts for between 10% and 20% of the total population in most developed economies (15% in the US, 12% in France, 21% in the UK).

Draconian austerity measures in a setting of lacklustre growth make a recipe for despair in the population, creating a breeding-ground for ever more popular extremist political parties. Recent general elections in Greece, France, the Netherlands, Austria and Sweden have seen farright populist and parties disturbingly making electoral breakthroughs or scoring big gains. Modern societies can no longer promise future generations a better, brighter future. Political instability precludes the vital nationwide consensus being formed to push through measures required to rebuild the foundations of a solid economy.

This economic-policy stalemate, in particular, is becoming increasingly blatant. Traditional Keynesian remedies are proving both unworkable and ineffectual. Record public deficits of 10% of GDP in 2009, inflated by the host of budget reflationary programmes, have resulted in governments being either de facto or potentially insolvent. Since then, with no financial ammunition left, governments have been unable to push through any further reflationary measures and compensate for the drop in wages by distributing increased social-welfare benefits. Worse still, by slashing public spending, a strategy regarded by economists as essential to restore countries’ sustainable financial viability, policymakers are making matters worse: as growth slows, deficit-cutting targets are being missed and the trajectory on public debt is moving ever further away from its optimal pathway. With no credit to dispense, State-administered Keynesianism is, in effect, bankrupt as government spending levers can no longer be activated.

A new role for government needs to be envisaged

How serious have things become?
After all, Keynesianism’s limitations have been apparent for some time. By seeking to kick-start growth by boosting consumer spending, it has become clear that modern economies no longer rely on consumption. To be more precise, the dynamics of virtuous, self-sustaining economic growth are not triggered by consumer spending. In contrast, the dynamics feed through eventually into consumption – they are instigated by investment and, by extension, jobs. This key focus on the investment/employment duo has been noticeably lacking in the US and European economic policy mix over the last four years. The time has come to review the role government and the State, shown now to be effectively toothless, play in influencing economic growth.

As governments alone are no longer able to spend and stimulate growth, they need to turn towards encouraging spending by other economic players, especially those who can intervene effectively to boost jobs and incomes, i.e. businesses. To do that though, politicians will need to be both bold and brave. At a time when capitalism is being accused of the most reprehensible wrongdoings, policymakers will need to display great courage to promote the virtues of entrepreneurship and business. However, while Keynesianism may be looking bankrupt, demand-side economic policies are looking dead in the water as well. As a result, moving to economics geared to boosting supply is absolutely indispensible. The rub is that the policies for this still have to be invented.

There has, however, been one illustrious precedent: the supply-side economies implemented with success by the Reagan Administration in the early 1980s, followed by twenty-five years of sustained growth in a period referred to as the era of the ‘Great Moderation’. The fresh approach to economic policy now will need to be generous in seeking to promote innovation. Investment and job creation tend not to happen without a major wave of innovation. Of course, innovation cannot be decreed into existence. But it can be nurtured through fiscal incentives that favour risk-taking. Huge tax breaks for R&D and capital spending would be likely to form the major building-blocks of any future budget policy to stimulate supply. Making such moves would call for great political courage as, nowadays, it is regarded as socially equitable and electorally advantageous to tax – even so heavily as to veer close to financial repression – those generators of wealth most liable to be most useful in boosting supply.

A fresh approach to economic policy

There is a second challenge though.
Unchecked, supply-driven economic policies tend to lead to excess. Modern economic history covering the Great Moderation period has demonstrated that overgenerous use of credit always ends in tears. First of all, in the 1990s, the belief that boom-and-bust cycles were things of the past thanks to the advent of revolutionary new information and communications technologies lured companies into running up huge borrowings beyond what their returns on equities could withstand. This sparked the bursting of the dot.com bubble and TMT (technology, media, telecom) crash. Then, from the early 2000s, it was households’ turn to overstretch themselves with debt, culminating in the sub-prime crisis. Moreover, innovation per se should not be regarded as universally wonderful. Just take the example of financial innovation which, unregulated, lay behind the ballooning debt.

Excess lending will inevitably lead to artificially-driven economic growth as it breaks the link between the cycles of innovation and economic growth. The virtuous qualities of real economic growth evaporate and become unreal. Growth fuelled by excess credit leads inevitably, as night follows day, to ballooning bubbles, burst by devastating crashes on financial markets. Fresh and well formulated supply-focused economic policies would need to take due account of such undesirable and destabilising implications. This concern points to a new role for central bankers, implying, by osmosis, a fresh style of monetary policy being needed as well. Inflation targeting (keeping core inflation around 2%), the sacred cow for central banks since the early 1980s, is no longer appropriate for either today’s growth conditions or for an innovative, supply-geared economic policy mix.

Imagination will be required to forge this new role for central banks. Not to mention the bravery in calling into question the orthodoxy that has held sway for so long. In the past though, periods when there have been serious ruptures in cyclical economic patterns have often seen major shifts and key policy breakthroughs. However, all the courage and boldness will be futile if the will to bounce back is lacking. The challenge is most daunting. The direction of economic policies over the next few years will dictate the structural trends for developed economies for decades to come. We just have to hope that policymakers will dig deep amid all the grave economic, political and social crises today to find that courage to be bold and innovative.

 


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Sun, 07/15/2012 - 17:46 | Link to Comment LetThemEatRand
LetThemEatRand's picture

If John M. Keynes had simply been named John M. Ponzi instead, it would be so much easier for the average guy to understand.  

But supply side tax breaks are the answer?  Reagan studied at the Ponzi school with the rest of them.  

Sun, 07/15/2012 - 18:03 | Link to Comment LowProfile
LowProfile's picture

 

Why policymakers must be brave and innovate with economic policy

EXCUSE ME, BUT WASN'T IT INNOVATION THAT GOT US HERE IN THE FIRST PLACE?!

THE "INNOVATION" OF DERIVATIVES!?

THE "INNOVATION" FRACTIONAL RESERVE LENDING?!

THE "INNOVATION" OF FIAT CURRENCY?!

 

WE NEED TO DE-INNOVATE!!!

Sun, 07/15/2012 - 18:27 | Link to Comment vast-dom
vast-dom's picture

NOT IS. HAS. LONG TIME AGO. MORE AT STILLBORN. NO AMOUNT OF SYNTHETIC AD INCREASES COULD SAVE REAL FREE MARKET AD. THAT IS WHY AUSTRIAN SCHOOL IS NOT FULLY EMBRACED -- IT IS SUPERIOR AND LEAVES NO ROOM FOR FAKE CHARTS AND CENTRAL PLANNING BS. ANY SCHOOL OF ECON THAT ALLOWS CENTRAL BANKS TO PERVERT AND DISTORT INTEREST RATES IS A FAILURE FROM DAY 1. 

 

praxeology biyatchez!

Sun, 07/15/2012 - 19:27 | Link to Comment Max Fischer
Max Fischer's picture

The reason Austrian economics has not been embraced is because the entire school is based on the reduction and containment of inflation.

Inflation is dead; thus, Austrian economics is dead. Depending on how you want to measure the market's anticipated inflation rate, it's anywhere from 0% (even less) to 2.07%.* Basically nothing.

The threat right now, and for the past five years, has been a sweeping deflationary buzz saw that cuts across all asset classes and sends the world economy into a devasting deflationary collapse. The only thing you hear from the Austrians is: good! The world deserves the collapse!

And this is pretty much why no one takes Austrians seriously. Largely, they're just a bunch of vindictive pricks who want to watch the world burn.

* Per ZH famed contributor, Bruce Krasting, the only meaningful yardstick to measure inflation is taking the Ten Year spread between Coupon and Inflation Index bonds.

Edit in: By the way, Keynesian economics hasn't been practiced in the US since before Nixon. How can one possibly blame Keynesian economics for the current crisis and the failure for a meaningful rebound when it hasn't been a part of federal policy in many decades? Just more right-wing bullshit.

Sun, 07/15/2012 - 19:34 | Link to Comment TheSilverJournal
TheSilverJournal's picture

The real question is why is "the market" is so afraid of deflation?

For some reason, the connection between falling asset prices and depositors being able to withdraw their money is rarely addressed, but yet, "the market" is deathly afraid of it.

Just because it hurts for those in the ponzi for it to be shut down, doesn't mean that even more people and resources should be suckered in to keep it going. Instead of talking in negative terms about how the world deserves collapse, the talks needs to develop into a much more positive approach. Once resources can be allocated more efficiently, productivity will boom.

Sun, 07/15/2012 - 19:43 | Link to Comment economics9698
economics9698's picture

You are so much nicer than I am.

Sun, 07/15/2012 - 21:29 | Link to Comment LetThemEatRand
LetThemEatRand's picture

You government contractors are so naughty!

Sun, 07/15/2012 - 22:35 | Link to Comment HoofHearted
HoofHearted's picture

Max Gischer, superdolt, or whatever it says about you...the way YOU measure inflation it's between 0 and 2.1%. But you have taken the Bernanke KoolAid th Fed spews out. Hell, if we go over to John Williams' Shadowstats, we'll see numbers like 7 or 8%. And if we just compute inflation without all the hedonics, we get something more like 5%. (And to think that our dumb ass government once used this way to compute official inflation. The nerve!) Moreover, if you have kids like me, you see inflation being much higher than that on the things that actually matter. Food is so much more expensive while my house payment hasn't gone down as the Bernank computes it should. Instead it is HIGHER because the idiots in my local government cannot live on a budget like my family has to. Instead they keep raising my taxes to pay for their idiocy...

Is Max Fischer the alter ego of MillionDollarBonus? They're just about as dense as the other.

Sun, 07/15/2012 - 22:45 | Link to Comment TheSilverJournal
TheSilverJournal's picture

Unlike Max, MDB knows exactly what he's saying. I tend to believe MDB is doing ZH a favor by setting up the status quo card an letting us get some practice taking punches at him. Either that, or he's a paid shill who knows and believes in free markets at heart but is selling out. Or, MDB could be practicing to be an economics professor and wants to make sure he's going to get the spot.

Sun, 07/15/2012 - 21:28 | Link to Comment PeterSchump
PeterSchump's picture

Deflation only sucks for the levered. Since banks and bozos are levered, the unwashed are brainwashed to believe prices returning to reality leads to Armageddon.

Sun, 07/15/2012 - 22:48 | Link to Comment TheSilverJournal
TheSilverJournal's picture

Reality is measuring in ounces. Real money can't be run off a printing press or created with a keyboard. The deflation in terms of PMs will be massive, while the inflation in terms of currencies will be massive.

 

Sun, 07/15/2012 - 19:41 | Link to Comment economics9698
economics9698's picture

Max Fisher...You are full of shit.  First off Austrians think the CPI is bullshit.  Its equivalent to measuring a bee swarm and hoping to get something close to reality.

Second deflation is the normal course for prices with a gold standard.  When inflation is zero it does not mean the Fed is not printing and counterfeiting, maybe they are, 1980s, Volker.

Third the reason Austrian want the collapse is so we can get a job.  As long as the money is flowing prices and resources cannot adjust and be put back into circulation.  You need the bust, lower prices, and readjustment to move resources from unproductive uses, Solindra, to productive uses, shale oil exploration, driven by the private markets.

Reagan was a Keynesian, spent like a MF.  Bush I, II, Obama Keynesian on steroids.

It’s pretty obvious you are a retard and should not post on these boards with this much talent to call your ass out.

 

Sun, 07/15/2012 - 20:21 | Link to Comment Max Fischer
Max Fischer's picture

You want a collapse so people can get jobs? In a collapse, money doesn't flow. Idiot. I can't believe that someone would actually believe that all we need is an economic crash for job growth. So fucking dumb.

*LOL*

Speaking of jobs, aren't you the anarcho-capitalist who works as a government contractor?

*LOL*

You guys are HILARIOUS!

Sun, 07/15/2012 - 21:24 | Link to Comment BlackGoldTexasTea
BlackGoldTexasTea's picture

Economics are irrelevant, anyway.  The point of most economic theories is to grow the economy.  Economic growth is finished.  Human population is in overshoot, as oil and other fossil fuels temporarily increased the carrying capacity of the planet.  People are what make up the economy.  Peak oil.  Peak people.  Peak economy.

The collapse is coming one way or another, but they might as well prop it all up for as long as they can.

The collapse of the US dollar means the ships stop coming to America - an immediately balanced trade deficit, even the ones that deliver our precious, precious 10 million barrels of oil imports every day.  Such a huge disruption in the oil supply will basically shut down the country.

Collapse will lead to job growth, but only after it reduces world population by several billion.  The Romans had an empire without oil.

At least all currencies hold dollar reserves.  Dollar goes down, they all go down.

http://www.youtube.com/watch?v=VOMWzjrRiBg

Sun, 07/15/2012 - 23:08 | Link to Comment Anusocracy
Anusocracy's picture

Peak economy will be reached just before WW3.

 

That's also when peak technology will be reached.

 

 

Sun, 07/15/2012 - 23:19 | Link to Comment BlackGoldTexasTea
BlackGoldTexasTea's picture

Peak economy was reached in 2008.  I'm talking about the real economy, not the GDP data from governments.

http://www.tradingeconomics.com/commodity/crude-oil

It will be like a roller coaster, until the currencies finally fail.  Economy will start to grow then hit high oil prices and be unable to grow and begin to contract, lowering oil prices.

Although, I do agree that World War III is quite likely.  But, the people in power know that will destroy the planet for them and their children too.  So, we shall see.

Sun, 07/15/2012 - 21:45 | Link to Comment Lucius Corneliu...
Lucius Cornelius Sulla's picture

Nobody wants a crash.  But 30 years of unsustainable trade and government deficits have created conditions whereby that is exactly what we will get.  There is no choice in the matter.  The real idiots are the psychopathic lunatics that have been in charge of the asylum for the past 30 years.  Keynesians and their bankster accomplices are like cocaine addicts who have finally reached the point of final burnout.  They will continue to prop up this fraud as long as possible, stealing from the public to feed their addiction.  The real trajedy is the wake of destruction suffered by the innocent.  But that is an all too common theme in history.  I say we are nearing a Louise the XVI moment.

Mon, 07/16/2012 - 07:08 | Link to Comment nohweh
nohweh's picture

  "We just have to hope that policymakers will dig deep amid all the grave economic, political and social crises today to find that courage to be bold and innovative. "           

 

Is that all. Just who the fuck are these policymakers and who do they work for? Thank God for the policymakers.

Sun, 07/15/2012 - 20:10 | Link to Comment Barking Spaniel
Barking Spaniel's picture

Max, I recommend you work for Massengill to be the mascot for their newest douche-related product.

Sun, 07/15/2012 - 21:39 | Link to Comment robertocarlos
robertocarlos's picture

Describes me to a tee. Let the fucking world burn!

Mon, 07/16/2012 - 04:49 | Link to Comment Max Fischer
Max Fischer's picture

Exactly. Describes every single one of you frozen-hearted, GI Joe wanna-be freaks.

Let the world burn! Fuck everyone!

On a psychological level, one must wonder where that despicable, yet proud, inhumane mentality comes from?

Mon, 07/16/2012 - 06:57 | Link to Comment ArkansasAngie
ArkansasAngie's picture

Price discovery ... Economic value.

 

Assets that are mispriced because their value has been based on imaginary, excel sheet in the sky, Bennie numbers will not promote organic growth.

 

I don't want bad things to happen.  The problem is bad things are happening now.  And these bad things today will not stop happening until moral hazard has been swallowed by thosse who are insolvent.  Then things will get better

 

So ... yes ... rip that bandage off.  Perform surgery to remove the rot and lets get on with living our lives.  

 

Misallocation is a bitch.

 

 

Sun, 07/15/2012 - 22:28 | Link to Comment Turin Turambar
Turin Turambar's picture

Hey Einstein,
Since you know so much about Austrian economics,name me a few books you've read. I can tell by your dumbass comments that neither Human Action nor Man, Economy, and State will be on the list. Do you even have a list of ANY books about the "Austrian" school? My guess is ZERO!

Ignorant dumbass.

Mon, 07/16/2012 - 00:13 | Link to Comment A Nanny Moose
A Nanny Moose's picture

an excellent demonstration of your utter lack of understanding of the Austrian School. Keep up the good work Maxi-Pad.

Sun, 07/15/2012 - 19:23 | Link to Comment TheSilverJournal
TheSilverJournal's picture

It's funny how "austerity" means less spending on the people, and not less spending on repaying bankers.

This is not to say I'm against austerity, but there should be much more austerity, including defaulting on debts that are impossible to pay back.

Sun, 07/15/2012 - 18:31 | Link to Comment Sudden Debt
Sudden Debt's picture

NOW THAT'S A INNOVATIVE IDEA!!!!

Sun, 07/15/2012 - 18:16 | Link to Comment TheFourthStooge-ing
TheFourthStooge-ing's picture

.

But supply side tax breaks are the answer?  Reagan studied at the Ponzi school with the rest of them.

Reagan broke the tax-and-spend addiction of his democratic predecessors which was dragging the nation's economy down.

Reagan's courage to stride forth in a new direction brought hope to America, and his bold policy of borrow-and-spend is responsible for the prosperity we enjoy today.

Sun, 07/15/2012 - 20:01 | Link to Comment economics9698
economics9698's picture

Reagan cut the top rate from 70% to 28% which increased tax collections 69% but he increased spending 76%, with the accompanying deficits.

Reagan increased social security taxes and collections increased 96%, these taxes fell on the middle classes.  Its a myth Reagan broke the tax and spend addition, he was clever to create a new elite top 20% that enjoyed unprecedented prosperity while taking a shit on the middle class.

As for the spending he set the post WWII record of a 6% of GDP budget deficit in 1983, a record that stood until 2009.

 

Sun, 07/15/2012 - 20:39 | Link to Comment Max Fischer
Max Fischer's picture

Reagan increased SS tax on the middle class to pay for the tax cuts for the rich, you idiot. The middle class was told by Reagan and Greenspan that the extra SS taxes would create a pool of additional funds, so that when baby boomers retire, the funds would be available. Well, guess what? The only thing in the SS cookie jar are IOU's, and that's why Americans are being prepped to accept LESS SS output, even though they had to increase their imput.

Instead, Reagan took that extra SS money and fucking SPENT it! That's how he balanced his budget, while still cutting taxes for the rich and still spending money on the huge 1980's military expansion.

It was THEFT! Just another example of the middle class getting FUCKED for the benefit of the 1%.

Dude, you're dumb.

Sun, 07/15/2012 - 21:35 | Link to Comment PeterSchump
PeterSchump's picture

All SS tax increases went into Al Gore's lockbox.

Sun, 07/15/2012 - 22:02 | Link to Comment Lucius Corneliu...
Lucius Cornelius Sulla's picture

Dude, you need to take Poli Sci 101.  All tax and spending bills must be approved by Congress.  Therefore, the Executive cannot cut taxes or spending.  IMHO, the real villians are the likes of Nancy Pelosi, Ted Kennedy, Barnie Frank, Christopher Dodd, Patti Murray, etc... etc...

Sun, 07/15/2012 - 22:05 | Link to Comment Lucius Corneliu...
Lucius Cornelius Sulla's picture

An important distinction to make about Reagon is that he (like any POTUS) can only recommend tax and spending decisions, but Congress has to approve them.  Reagon wanted to beef up the military so he went along with guns and butter without vetoing spending bills.  So in that respect, he was culpable.

Sun, 07/15/2012 - 18:24 | Link to Comment TeMpTeK
TeMpTeK's picture

Keynesianism hasnt failed.... We just need more Cowbell....

 

Sun, 07/15/2012 - 18:26 | Link to Comment TeMpTeK
TeMpTeK's picture

Ding!

Sun, 07/15/2012 - 18:26 | Link to Comment Tom Green Swedish
Tom Green Swedish's picture

Reagan although not perfect was left with a big pile of garbage.  A failed Vietnam war. A huge energy problem. High Unemployment.  But at least he was not a Socialist.

Sun, 07/15/2012 - 18:37 | Link to Comment blunderdog
blunderdog's picture

Cut taxes, raise spending, start more wars.

It's a time-proven technique.

Sun, 07/15/2012 - 19:58 | Link to Comment economics9698
economics9698's picture

For poverty and unemployment.

Sun, 07/15/2012 - 22:34 | Link to Comment jerry_theking_lawler
jerry_theking_lawler's picture

no, for population control.

Mon, 07/16/2012 - 00:18 | Link to Comment A Nanny Moose
A Nanny Moose's picture

For eliminating excess production.

Mon, 07/16/2012 - 07:59 | Link to Comment BigDuke6
BigDuke6's picture

 "Recent general elections in Greece, France, the Netherlands, Austria and Sweden have seen farright populist and parties disturbingly making electoral breakthroughs or scoring big gains."

The socialists have imported too many voters for them to get far.

Civil war comes to europe with jihadi's pouring in from north africa.

Sun, 07/15/2012 - 18:34 | Link to Comment oldmanagain
oldmanagain's picture

No question that Keynes is a theory, a scientific theory at that, just as all science is a theory. What makes theory as physical law is the correctness of its theorems and math.  In this case, conforrmance to actually occuring in space and time.  So called, real world. On the latter, Keynes is king.  Austrian is nowhere.  A dream system favoring a few.

The support of the dream system, no regs, winner take all, is quite evident in our current situation.  Those Austrian "animal spirits" did us no favors. No, it is not about the FED. That is just misdirection of blame by stake holders trying to avoid the hangings.

Austrian econ is more like, let us rob you and it will make you feel better as part of the scam. You know you should of out sourced with us.  Your fault. We need to lower your SS and med payments to teach you a lesson. Remember, no law is good law, the animal must be fed.

Sun, 07/15/2012 - 19:11 | Link to Comment Offthebeach
Offthebeach's picture

Pop. The van from the Ted Kennedy assisted living on MLK Avenue is here. Time to go.

Mon, 07/16/2012 - 05:05 | Link to Comment Lebensphilosoph
Lebensphilosoph's picture

There is no scientific economic theory.

Sun, 07/15/2012 - 21:05 | Link to Comment Coke and Hookers
Coke and Hookers's picture

Keynesianism is an instrument to falsify the economy like fake dollar printing plates. Well like real dollar printing plates too I guess.

The inevitable result of keynesianism is the replacement of real wealth creation with asset/income seizing, current and future, which is then pumped into the economy in the form of fiat. If there's measured growth as a result of this, it's almost certainly going to be fake. The end result of this is wealth transfer to the people who control money so I suppose you could call keynesianism a "wealth transfer instrument functioning through economic fakery."

Mon, 07/16/2012 - 07:58 | Link to Comment sessinpo
sessinpo's picture

There is a distinct difference that people need to understand. Supply side is simply the government spending and expanding more to compensate for a weak economy. While it is fiscal, this has nothing to do with taxes. What Reagan did that was positive was to support lower tax rates which encouraged businesses to reinvest and also hire, thus the boom of the 1980s. Add in there the prospect of increasing interest rates (cost to borrow), it made more sense for businesses to reinvest savings. Reagan's mistake as with all politicians was to expand government and debt, a destructive trend that we still see today. Of course, during Reagan's presidency and later, you would not have heard much of anyone saying that the military buildup to defeat the Soviet Union was bad. They did get the results they wanted, but at what price? Keep in mind that Reagan could not do all he did without the consent of Congress. Back then, we did not have executive orders thrown around like confetti as we do over the last decade.

I'm not bashing your post. I am not for Keynes. I would like to see less government in almost all cases. Everytime they intervene, they take away freedoms and only delay the inevitable. Government cannot change market forces. They only manipulate them and delay the eventual result which is usually worse because of the intervention.

Ponzi on fellow ZeroHedger.

Sun, 07/15/2012 - 17:45 | Link to Comment Sudden Debt
Sudden Debt's picture

THE 4 BIG EMPIRES ON TOP!!!!
I like it :)

Sun, 07/15/2012 - 22:30 | Link to Comment ZeroSpread
ZeroSpread's picture

With Japan remaining the "standard" everybody likes to be compared to..  "are you Japan plus or minus"?

Sun, 07/15/2012 - 17:47 | Link to Comment SheepRevolution
SheepRevolution's picture

Fuck Keynes. Banksters took advantage of his false theories, confusing everybody into believing that more debt can solve problems. More debt is what the banksters fought for the very first day US was founded (and even before that by the Rothschilds).

 

Keynesianism is as dead as it can be. What needs to become alive is the sheeple.

 

For Liberty!

Sun, 07/15/2012 - 20:59 | Link to Comment ATM
ATM's picture

Keynes was a Socialist and his whole theory really invokes nothing more than a controlled economy. Governemnt in Keynes view should be the speed regulator of the economy. That power really means that government is the economy and controls the economy.

The US government was not granted that power by the people, no matter how many times we are indocrinated by the simple little phrase we hear daily, that the President "manages the economy".  I mean what the fuck?! We gave some dipshit community organizer, Maoist, dope head the power to "manage the economy"? (the same goes for any past POTUS as well) 

It really isn't in their job discription.

 

News flash: John Maynard Keynes is still dead.

Sun, 07/15/2012 - 17:45 | Link to Comment Sudden Debt
Sudden Debt's picture

now subtract the local inflation rates and let's see if there's sill countries left on the surface.

I bet more would be at the bottom together with greece. Greece would be up because they are in a deflation trap, the US, Germany, France and The Empire of Belgium would be way lower because of their local inflation rates.

Sun, 07/15/2012 - 17:47 | Link to Comment caimen garou
caimen garou's picture

tilt tilt tilt,RESET!

Sun, 07/15/2012 - 18:25 | Link to Comment bank guy in Brussels
bank guy in Brussels's picture

Re the 'courage' this article recommends for economic policy makers ... while unclear as to what that 'courageous' policy would be -

Could not but help think of the Lion in 'The Wizard of Oz' ... telling us about 'Courage' -

http://www.youtube.com/watch?v=LEEyijiTW-I

Sun, 07/15/2012 - 17:57 | Link to Comment falak pema
falak pema's picture

good question! We are ALL keynesians in the depression!

Whereas Libertarianism HAS run dry! As in 2008!

Thank you Paulson and GWB; as follow up to Greenspan and Clinton. All true sons of Reaganomics big bang. To make the rich richer.

In order to avoid losing ALL their wealth the old libertarians have turned Keynesian. Whence the confusion. ZH/TD and Ron Paul the only rare protagonists for return to Austerity big time that would ruin the Oligarchy.

So it won't happen logically; only if they lose it big time! In the meantime, we are ALL Keynesian now, the false ones like Bernanke/Blankfien/Diamond and the true one like Krugman. All Keynesian, as they are all part of the 1%!!!

Sun, 07/15/2012 - 18:58 | Link to Comment Marco
Marco's picture

How stupid do you think the elite are? They are exposed to the financial ponzi only from behind 7 proxies ... their hard assets (land, means of production, mining rights, water rights, etc) are plentiful and going nowhere. The only thing which can endanger those are taxation, not libertarianism.

They recognized crony capitalism could make them richer ... but when that has run it's course they'll go back to being libertarians and their dynasties will go back to living large off rent seeking.

Sun, 07/15/2012 - 21:02 | Link to Comment ATM
ATM's picture

The "Elite" are only waiting for the entire system to implode like it was set up to in the first place. There was never a question as to if it would only when. They are positioned to assume all power when the time comes and are only worried about a coordinated public uprising.

They want it to be the Middle Ages.

Mon, 07/16/2012 - 04:40 | Link to Comment falak pema
falak pema's picture

You don't get it : the past has made libertarianism dead, a dry river totally without any resources, as its all off shore and it ain't coming back. Oligarchs don't play this game of socialising debt for fun; its very real as its their bloodline. 

That's why the State which represents us all, has only three options : more debt, less spending and more taxes. 

There is no other route out of this except real Armageddon. 

and that may be on the cards as a last resort. 

In the meantime, the state has to come up with a plan, and it can ONLY be ONE thing : Keynesian. 

No where to run anymore, except debt and taxation; obviously with state spending cutbacks to suffocate the 99%. In the taxation case the Oligarchs will scream but they will have to cough up some of it or see it all melt away SOONER  in financial implosion of first world financial institutions.

Dead end alley! 

Mon, 07/16/2012 - 07:56 | Link to Comment sessinpo
sessinpo's picture

Very good post. This is why I scoff at those attacking the 1% and dreaming of a revolution that will make things even. There is always a 1%. They have survived countless wars, recessions and depressions. Many of them have become even more wealthy and powerful.

The occupy group are some of the most ignorant, kool aid drinking, talking points people out there can't seem to understant the view point you just posted.

More time and energy is wasted by such people by complaining and envying the top wealthy people instead of working, innovating and achieving such wealth for themselves.

Sun, 07/15/2012 - 17:54 | Link to Comment Getting Old Sucks
Getting Old Sucks's picture

So why hasn't the great minds of the solution have yet to reveal the true solution politically?  DICTATORSHIP!

Sun, 07/15/2012 - 17:54 | Link to Comment masaccio
masaccio's picture

Good luck with a rerun of those stale reaganite policies that have never once worked, now under tea party leadership, if leadership is the right word for refusing to govern.

Sun, 07/15/2012 - 18:08 | Link to Comment duo
duo's picture

The seeds of the Reagan revolution were planted when Volker jacked up interest rates.  The capital that  was saved during that period is what financed the semiconductor/PC revolution, leading to the internet a decade later.

Sun, 07/15/2012 - 17:55 | Link to Comment disabledvet
disabledvet's picture

Sounds complicated. How 'bout we go invade somebody instead? Oh, wait...

Sun, 07/15/2012 - 17:56 | Link to Comment LetThemEatRand
LetThemEatRand's picture

I really wonder who these mythical "generators of wealth most liable to be most useful in boosting supply" are supposed to be.  Seems to me that most large corporations are banking money overseas and hiring cheap labor overseas rather than reinvesting in America, even though real corporate tax rates are the lowest they have been in more than a generation.   Small businesses are trying to find consumers who can afford to pay for their goods and services after they are done paying their over-inflated mortgage, gas, groceries, etc that are insanely high due to the inflation tax.

Sun, 07/15/2012 - 18:36 | Link to Comment TWSceptic
TWSceptic's picture

Yes, we do not want efficiency and profit, we want nationalism. Capitalism got it all wrong: it's about 'our country' and 'our people', that is what matters.

 

How dare those capitalists seek for the most efficient and profitable way to run their business, don't they understand that all that matters is jobs (in America)? Obama said so.

Sun, 07/15/2012 - 18:44 | Link to Comment blunderdog
blunderdog's picture

      How dare those capitalists seek for the most efficient and profitable way to run their business, don't they understand that all that matters is jobs (in America)?

It's all well and good as long as no one's pretending they care about anything but another dollar. 

The nihilist capitalists are perfectly consistent and reasonable if no one gives a flying fuck about the USA, or right and wrong.  They are justifiably proud to rob a baby just because the parents are idiots.

Mon, 07/16/2012 - 13:10 | Link to Comment kingslayer
kingslayer's picture

I suppose lying, cheating, and stealing can be an efficient and profitable way to run a business.

Sun, 07/15/2012 - 17:57 | Link to Comment proLiberty
proLiberty's picture

Keynesian ecomomics was born in a morally bankrupt state, for its foundations are the presumption of power by the State over all wealth and future income of the citizens.   It is just another way to attain a socialist Utopia, only this time in a three piece suit.

 

Sun, 07/15/2012 - 18:24 | Link to Comment PulpCutter
PulpCutter's picture

Reality is a morally bankrupt state?

Sun, 07/15/2012 - 18:00 | Link to Comment crawldaddy
crawldaddy's picture

oh please, you really think austerity is the answer?  wtf world you been watching?

Sun, 07/15/2012 - 18:10 | Link to Comment obejoyful
obejoyful's picture

There has been no Austerity for 40 years, have you seen the debt levels all over the world. Spending like drunken sailors and just the mention of slowing down the debt has people like you freaking out.  Live within your means, Keynes was be disgusted with what people are doing, he said in times of trouble to pick up spending not every year, evey decade. 

Mon, 07/16/2012 - 08:03 | Link to Comment sessinpo
sessinpo's picture

Austerity is simply the restriction of something - in this case economic. It occurs whether a government imposes it or not. The MSM would have you think it is imposed by government, but sometimes there is no choice, like when you run out of money. Consider the 3 bankrupt cities in CA. Conisider the city employees of Scranton, PA, who are now on minimum wage. Consider Jefferson County. This list will continue to grow as municipalities run out of money. Sure you can say the government imposed it. But the reality is the market is imposing it on the government.

Sun, 07/15/2012 - 18:02 | Link to Comment Stuck on Zero
Stuck on Zero's picture

I'm waiting for someone to try Keynesian stimulus.  All I see is theft by banksters and politicians. The real idea is to take printed dollars and buy things with them of value: property, commodities, infrastructure, etc..  These assets will not devalue the currency. If you don't receive anything for the dollars spent then you have removed that much value from the economy and the stimulus will always fail. 

The best stimulus for our economy right now would be for the Feds to cut government spending and start buying gold.

 

 

 

Sun, 07/15/2012 - 23:57 | Link to Comment Stuck on Zero
Stuck on Zero's picture

The comment is my little test.  A gold standard is a system in which currency is printed and gold purchasesd with it or, vice versa, gold is sold.  In an economic system with a gold standard a recession drives the value of the currency higher and the government may then purchase more gold.  This puts cash into circulation spurring the economy.  Likewise, if the economy overheats the price of the currency falls and the government can sell gold to remove cash from the economy. 

Mon, 07/16/2012 - 08:06 | Link to Comment sessinpo
sessinpo's picture

"I'm waiting for someone to try Keynesian stimulus."

 

You're waiting? After racking up $16 trillion in national debt, how much more are you going to wait?

Sun, 07/15/2012 - 18:04 | Link to Comment zero19451945
zero19451945's picture

I am going to come out and say that I despise Keynesianism. It doesn't work and never will.

With that being said, we don't actually have it.

Keynes' idea was to save during good times and deploy that cash in an attempt to even out the business cycle during bad times. 

He never said to deficit spend until you go broke like the US is trying. 

Sun, 07/15/2012 - 18:38 | Link to Comment PulpCutter
PulpCutter's picture

"It doesn't work..." 

Check your facts.  If you just look at the results until 2009, I can see how you might hold your view - but look what's happened since 2010. 

"Deficit spending to infinity" is a straw man argument.  What you do is provide public-sector demand, until the private sector has deleveraged enough that private-sector demand can take over - then you pay down the debt via increased productivity (due to wage decreases during the recession) and increased GDP.  America is already doing this; total (public and private) debt/GDP has been dropping since 2010.  Textbook post-debt bubble deleveraging.

I was as critical of Bernanke and Krugman as anyone - until three months or so back when I took a look at the data.  When the facts change, you have to reconsider your theories.

Sun, 07/15/2012 - 18:52 | Link to Comment monoloco
monoloco's picture

Where Keynesian theory fails is that it depends on politicians to have the discipline to cut spending and raise interest rates during times of economic growth. Mostly, they have proven to be incapable of that.

Sun, 07/15/2012 - 22:50 | Link to Comment Temporalist
Temporalist's picture

No Keynesianism made it convenient for politicians owned by bankers to say they were Keynesians since never ending money by the state is what every politician and banker wants to hear.

 

Keynesianism should have a slogan: "We'll Give You More Money!" 

 

It's much like how Greenspan said that bankers will act like there is a gold standard, responsibly, within limits, with rules...that didn't work out so well.  Also a convenient excuse "Whoops I was wrong."  "Whoops we gave endless coffers to politicians and it was a mistake.  Whoops."  "Whoops we bailed out the most greedy psychopaths on the planet who were the very people that destroyed the global economy.  Whoops." 

 

Alternatives are:

"Models showed..."

"We couldn't have known..."

"Nobody saw it coming..."

"It's never happened before..."

"Time Magazine said..."

 

Mon, 07/16/2012 - 08:09 | Link to Comment sessinpo
sessinpo's picture

You forget the part where government knows best how to spend money and is more efficient. I can only think of a few instance where government projects have been successful only because private industry was not ready and willing to take on the risk. Other than those few instance, I can name tons of examples where government stimilus has been an inefficient waste.

Sun, 07/15/2012 - 20:08 | Link to Comment itstippy
itstippy's picture

How can the citizens be deleveraging while the personal savings rate is decreasing?

http://research.stlouisfed.org/fred2/series/PSAVERT

The answer is that bad debt is finally being recognized and (painfully slowly) written off.  This gives the illusion that citizens are paying down debt.  They aren't.  The most distressed citizens are defaulting on it or having it modified lower.  This deleverages both the banks and the citizens when viewed in aggregate, but it's certainly not "textbook post-debt-bubble deleveraging".  And at this rate we've got a long, long way to go in the deleveraging process.  A decade at least.

The entire U.S. economy is now fully dependant on ZIRP from the FED.  Bernanke can't see or won't admit the systemic risk of this.  After 4 years and the promise of its continuation "for an extended period at least into 2014", ZIRP is now part of everyone's business model, accompanied by periodic Quantitative Easing.  The systemic risk of the situation is terrifying. 

Sun, 07/15/2012 - 20:23 | Link to Comment All Risk No Reward
All Risk No Reward's picture

Pulp, what facts changed?

The monetary system is still a debt based fraud as illustrated in detail here:

Debt Money Tyranny:

http://www.keepandshare.com/doc/3325954/debt-dollar-tyranny-2-54k?tr=77

The data shows that debt relative to GDP is still in bubble area, the private economy is still debt saturated to the point that $2+ trillion of new federal reserve (FR) and government debt is required to keep the Ponzi from collapsing.

Essentially, your argument is that $2+ trillion in annual FR and government is sustainable.

Weapons of Mass Debt:

http://www.keepandshare.com/doc/3324744/wmdebt-graph-3-79k?tr=77

You also don't tell your readers that from 1980 to the collapse in 2008 debt rose faster than GDP in every single quarter, BAR NONE!

http://market-ticker.org/akcs-www?post=207083

It is the third chart down.

Now, update your view based on the new data... and note that debt was growing at twice the rate as GDP.

You do understand exponential math, don't you?

Keynesianism is the false narrative used to funnel the nation's cah wealth to the criminals just before they collapse the economy to buy it up for pennies on the dollar.

Yeah, the banksters will eventually hyperinflate, but only when they own all the real chit and it is time to "balance their books."

Sun, 07/15/2012 - 20:31 | Link to Comment AbelCatalyst
AbelCatalyst's picture

Pulp: this process is just beginning. Do you really think we can grow our way out of this? Come on!

Here's a fact that may change your mind. The gap between what has been promised (social security, Medicare, military spending, etc) and the tax revenues is $200 Trillion in today's dollars. Oh yeah, we'll just climb our asses out of that little rabbit hole.... I'm sure the private sector will be able to take up that slack as the public sector implodes...

Seriously, what is wrong with you??

Sun, 07/15/2012 - 20:59 | Link to Comment Solon the Destroyer
Solon the Destroyer's picture

"It doesn't work..." 

Check your facts.  If you just look at the results until 2009, I can see how you might hold your view - but look what's happened since 2010. 

"Deficit spending to infinity" is a straw man argument.  What you do is provide public-sector demand, until the private sector has deleveraged enough that private-sector demand can take over - then <you pay down the debt via increased productivity (due to wage decreases during the recession) and increased GDP.  America is already doing this; total (public and private) debt/GDP has been dropping since 2010.  Textbook post-debt bubble deleveraging.

I was as critical of Bernanke and Krugman as anyone - until three months or so back when I took a look at the data.  When the facts change, you have to reconsider your theories.

Maybe you should check your facts.  Any GDP or Debt to GDP numbers this year are estimates.

You should also check the fact that 2.4% GDP growth is considered the US economy's stall speed.  You will have to ask Bernanke why that number is biased to the positive since you are unlikely to work it out for yourself.

Here's some more facts. What you are descibing has never worked in history.  If you are relating this to the payment of WWII debt you will have to include explanations for the twenty years of inflation used to degrade that debt that resulted in subsequent gold defaults. We would have had a Depression then if they hadn't. It still led to the bond speculators driving the price of debt through the roof to accept the new unbacked paper.

They've managed to keep the game going since by blowing bubble after bubble with ever cheapening money and lower yields to keep the bond speculators in the game. Without that it would be all over.

Or doesn't your ideology accept empirical data like falling interest rates, rising gold prices, high structural unemployment, bankruptcies, foreclosures, increasing numbers of recessions, increasing depths of recessions, present value of debt load, bank crises, sovereign crises, the derivative pyramid, and the failure of central banks to prevent or recognize any of this every step of the way?

Mon, 07/16/2012 - 07:28 | Link to Comment Inthemix96
Inthemix96's picture

Pulpcutter,

Here let me try.......  You do understand that every dollar, pound, euro is created out of thin air from a central bank?

Then said money is lent by you at INTEREST, now step back, they never printed the interest you had to pay back, it was never created, so how can you pay it back?

Now from this juncture, can you understand the USA has 16 trillion of unpayable debt?  Over the pond here we are at an astonishing 1000% debt to GDP.  Do you not understand this?

We reached saturation point in 2008, and take a cast iron guarantee fron me, this is not going to end well

Sun, 07/15/2012 - 18:09 | Link to Comment TWSceptic
TWSceptic's picture

Even if the fed pumps 100 trillion in the economy and it does not recover, people like Krugman will say 'not enough' and think he won the argument. Or just blame capitalism if all else fails. Stupidity never dies.

Sun, 07/15/2012 - 18:22 | Link to Comment PulpCutter
Sun, 07/15/2012 - 19:18 | Link to Comment Offthebeach
Offthebeach's picture

There has been zero, zip, nada GDP growth since 1980.
It's all been debt fluffed.

Sun, 07/15/2012 - 20:47 | Link to Comment AbelCatalyst
AbelCatalyst's picture

Creating money out of thin air is not recovering. If the Fed stops printing the economy stops "growing." How is this a recovery? Incomes dropping and inflation rising? How is this a recovery? We just spent historical amounts of money on stimulus and the unemployment rate has barely budged. How is this a recovery? One part of the government is buying debt from another part with created money. How is this a recovery? The US government is in a death debt spiral, increasing deficits at an unparalleled rate. How is this a recovery?

Honestly, you sound like a plant from the Fed trying to make a case. The only problem is the readers here have already seen the little impotent man behind the curtain which is why they are buying boatloads of hard assets.

Sun, 07/15/2012 - 18:09 | Link to Comment PulpCutter
PulpCutter's picture

"Is Keynesianism running dry?"

No.

The US resumed GDP growth in 2010, and the US's total debt/GDP ratio has been dropping since then.

http://www.usgovernmentspending.com/spending_chart_2000_2012USb_13s1li011mcn__US_Gross_Domestic_Product_GDP_History

What IS running dry is excuses to believe Austrian economics has any relation to reality.

Sun, 07/15/2012 - 18:11 | Link to Comment TWSceptic
TWSceptic's picture

Looking at GDP (which is a flawed measure of economic strength) and then talk about relation to reality. Epic self ownage.

Sun, 07/15/2012 - 18:14 | Link to Comment zero19451945
zero19451945's picture

Especially when you back out all the government's borrowing out of the GDP number. What's 1.5%- 8%?? According to my simple "Austrian" mind that's a pretty big negative number. 

To claim the US is growing is complete bullshit. 

Sun, 07/15/2012 - 18:21 | Link to Comment PulpCutter
PulpCutter's picture

If total debt/GDP is dropping (and it is, since 2010, as GDP increases), what's your concern?

How is it that you say the US economy is not growing?  Here's the link again

http://www.usgovernmentspending.com/spending_chart_2000_2012USb_13s1li011mcn__US_Gross_Domestic_Product_GDP_History

Economic output is increasing. 

Sun, 07/15/2012 - 18:50 | Link to Comment TWSceptic
TWSceptic's picture

I invite you to look at the trade deficit. When you're done with that take a look at real unemployment and real inflation. Then look at the unfunded liabilities and see what they will do to this 'growing' economy in a few years. Just hope that interest rates don't go up, or a black swan event occurs.

And remember: to the untrained eye, everything always seems to go well before it all goes bad.

Sun, 07/15/2012 - 20:36 | Link to Comment All Risk No Reward
All Risk No Reward's picture

I have several concerns.

1. $600 trillion in derivatives that could come into play any day as Europe falls apart.  The real number is likely closer to $1 quadrillion and could be $1.5 quadrillion or more.

2. From 1980 to 2008 collapse debt grew faster than GDP every single quarter, bar none.  What people like you call "recovery" is when debt grows faster than GDP.

3. The fact people like you don't seem to comprehend simple exponential math.

4. The $2.5 trillion of new debt issuance every year by the Fed and the government isn't sustainable.  The system collapses without it.

5. Fraudulent debt based money is still in play...  society goes bankrupt NO MATTER WHAT.  We only argue time frame under this version of financial tyranny.

http://www.keepandshare.com/doc/3325954/debt-dollar-tyranny-2-54k?tr=77

6. Black letter law criminals and liars are runnign the Fed...  they criminally took debt exponential to GDP...  just like they did in the 1920s.

7. Derivatives take precedence in bankruptcy thanks to the 2005 bankruptcy law (nobody saw this mess coming - repeat that over and over until it sticks).  Depositors are about to get zeroed out.

8. $70 trillion in G10 debt underpins $700 trillion in derivatives...

http://www.scribd.com/doc/95493792/The-End-Game

Sun, 07/15/2012 - 18:15 | Link to Comment PulpCutter
PulpCutter's picture

What is your concern with use of GDP to measure strength, and what alternative do you prefer?

 

Sun, 07/15/2012 - 18:31 | Link to Comment ltsgt1
ltsgt1's picture

Take import and government spending off the GDP, it doesn't look too good.

Do you know the equation of GDP?

Sun, 07/15/2012 - 19:18 | Link to Comment PulpCutter
PulpCutter's picture

Production is production in our current measure of GDP, even if the govt buys it (aka, we the taxpayers buy it through our taxes).  Think zero govt is the ideal?  Interesting theory - but live in Somalia for a while, then report back to us on the reality of it.  Otherwise, the things your taxes buy are part of GDP.

Imports are not part of GDP...not sure where you're going there.  If you're implying that America needs a strong, export-driven economy again, I agree with you; but that's a separate issue from the Keynes/von Mises issue.  We've had a string of corruption-friendly, middle-class-screwing governments since at least the mid-1960s (Reagan, both Bushes, Nixon, Obama, Clinton...note that Obama and Clinton are not liberals; they're conservatives wearing a "liberal" name tag).  The dollar tripled in value, in trade-weighted terms, from the 1950s to year 2000.  Most of our major trading partners actively manipulate their currencies lower; particularly China, Japan and Canada - and the Euro crises had made things even worse for US exporters.   You can't even buy and sell the yuan freely, yet China continues to insist they need special treatement because they're a growing 2nd-world economy. 

 

 

Sun, 07/15/2012 - 19:31 | Link to Comment Offthebeach
Offthebeach's picture

The country was built, Brigdgeport, Lowell, Newark, Gary,and thousand of cities, railroads, industry, waves of immigrants at under 10% combined taxes. Now near 40%, doubling 200 years of de t in 4 years and what do we have?

Germans aren't Greeks and we aren't Somalians. Most all gentrified yuppie old town centers and towns were built pre large wealth eating gubberment.

Sun, 07/15/2012 - 20:02 | Link to Comment PulpCutter
PulpCutter's picture

No argument that taxes are higher (it's just a fact), but are we mistaking correlation for causality?  There's actually one (previously) major tax, that's now a LOT lower.

Sail into any of the older harbors on the east coast, and you can still spot the customs building - prominent of the waterfront.  Up until 1913, the govt's main source of revenue was import tariffs.  1913 brought us the income tax (and the federal reserve), and tariffs have been steadily lowered.  US manufacturing grew up behind that wall of tariffs.  Our major trading partners also shelter their manufacturers, through manipulating their currencies and playing games with our imports.

Arguments about high big the govt ought to be are entirely appropriate and constructive.  But Pictet intentionally excluding the 2010-today data is useless bullshit.

Wages for the lower-skill end of the labor market have skidded.  We're not back to where we were in the heyday of Lowell, Gary, etc., but some of that competitiveness has come back.  The papermills of Millinocket (big, not sure but might be some of the biggest remaining in New England) have re-opened, and with local (NH), private money.  Downside is that the wage for the first four years is $11.50/hour, but at that rate they can competitively produce product.  Some of the younger Mainers don't like it, but for a lot of the older people it's just a return to their youth. 

Sun, 07/15/2012 - 20:33 | Link to Comment Solon the Destroyer
Solon the Destroyer's picture

US manufacturing grew up with a gold standard. That began its end in 1913 and was severed again in 1933 and then obliterated in 1971.

It has been all downhill for US manufacturing ever since. Capital destruction every step of the way. Such is the nature of a system of irredeemable currency and bond speculation.

Despite the overwhelming empirical evidence in support of this Austrian thesis, which has predicted these outcomes every step of the way, Keynesian monetarists fools addicted to easy debt and government spending do everything they can to continue The Great Con.

It will not end well.

Sun, 07/15/2012 - 20:42 | Link to Comment All Risk No Reward
All Risk No Reward's picture

Solon, this idea that gold as money is a panacea was NOT shared by the people under the yoke of a gold based system controlled by criminals.

Note, before panties get twisted, I didn't throw a gold system under the bus, just one controlled by criminals.

I suggest a little research beginning with William Jenning Bryan's Cross of Gold speech.

"Gold and money are separate things, gold is the trick mechanism by which you can control money.  That is the root of all evil."
~Thomas Edison

When criminals rule the roost, no system will work well for the common person.

Sun, 07/15/2012 - 18:12 | Link to Comment jimmyjames
jimmyjames's picture

We just have to hope that policymakers will dig deep amid all the grave economic, political and social crises today to find that courage to be bold and innovative.

*************

It isn't that complicated-

All that's needed is for government/policy makers to get out of the way and allow the market to work-

It would sort this shit out very quickly and efficiently-

Bodies would be floating-but sometimes bodies need to float-

Sun, 07/15/2012 - 18:15 | Link to Comment oldmanagain
oldmanagain's picture

Doubt that few ZH'ers even know what Keynes was all about.  Empirical, ie science of econ.  There is the Theory of Gravity, etc. and there is gravity regardless of theory.  Econ is the same way.  There is theory and there is econ in all it"s complexity.  Keynes is nothing but the attempt to take the success of the scientific method and apply it to econ.

It does not matter if one believes in gravity.  It does not matter if one does not like the Keynes equations.  The point is always, does it confirm what is going on the the real world.  Austrian marlarkey has not measured up on any crucial observance of the real world except as an excuse to exploit people.

Amazing that the anger of ZH should be directed at their own false god. Austrian malarkey.

Sun, 07/15/2012 - 18:23 | Link to Comment jimmyjames
jimmyjames's picture

 Austrian marlarkey has not measured up on any crucial observance of the real world except as an excuse to exploit people.

*************

Gold is the by-product of dying suns –
It is only produced in the crucible of a supernova.
Sun, 07/15/2012 - 19:35 | Link to Comment Offthebeach
Offthebeach's picture

Good thing governments don't exploit people.

Sun, 07/15/2012 - 18:28 | Link to Comment centerline
centerline's picture

Econ is more of a social science.  Hard to compare to anything more material.  But, one thing is for certain, the math of neo-classical economics are painfully lacking.  Folks like Steve Keen - whom I dont always agree with, but have great respect for - understand this, don't tend to make excuses, or hide behind jibberish. 

Blaming Keynes here is pretty stupid IMO.  Throwing the baby out with the bath water per se.  Most respectful economists have contributed over time to the common good in one way or another.  What is shameful is when leaders think that economic theory is static and enduring... here it becomes dogma, not science.  What is criminal is knowing this and using it as a weapon of power, greed, etc. 

Sun, 07/15/2012 - 18:39 | Link to Comment jimmyjames
jimmyjames's picture

What is criminal is knowing this and using it as a weapon of power, greed, etc.

************

I wont comment on anything more than this-even though i don't agree with Keynes or Keen (on his QE the people) but you are dead on with this statement-

The "psychological effects" that the availability of the money/credit supply has on the masses--is well known to the money changers and with their power to distribute or take away-as they do-for the purpose of world robbery-is as criminal as it gets-

Sun, 07/15/2012 - 18:52 | Link to Comment sablya
sablya's picture

People who talk about the scientific method as if it was an objective guide to truth know nothing of the philosophy of science.  There are presuppositions in every scientific theory.  Both the Ptolemaic and Copernican views are "empirical" but they have radically different explanations for the raw data.  

If there is a desire to look at the data, let's look at recent history.  Since 2008 the Keynesians have had their way.  The central planners have tried to manage the economy.  The problem is that the central planners are fools who think they can understand the complexity of the aggregate of collective human behavior in the midst of a crisis.  They cannot and do not understand what they are doing because they don't understand human nature.  

The same politicians who grossly overspent to support their "constituents" and indeed to line their own pockets via the revolving doors of special interests have been given the responsibility of overseeing the injection of trillions of dollars into the economy.  Keynes idea of using deficit spending to promote growth is simple idolatry.  Growth is not always the answer.  And to think that pumping liquidity into the system will promote growth without promoting bubbles, unsustainable, unethical and untenable in the long-run, is naive in the extreme.

Why is growth always necessary?  And if a little growth is good, maybe more growth is better?  No central planner is sufficient for these things.  No central planner can resist the tempations to give her just a little more gas.  And we see the end in sight - it is like giving stimulants to a man who hasn't slept in days.  It not only doesn't help him stay awake, it damages the organism.  Now they're to the point where they're damned if they do and damned if they don't.  It is too late.  The thing will collapse and the more they sustain it, the worse the ultimate collapse will be.

Sun, 07/15/2012 - 18:41 | Link to Comment francis_sawyer
francis_sawyer's picture

2012 is the 'mother of all' sychophant WASHOUT years...

- The niggers are going to vote for Obama (come hell or high H2O ~ because he's 'still' their nigger)...

- Unions are going to vote 4 Obama (come hell or high H20 ~ because their UNION BOOSSES tell them that that's who they need to support to keep their PHAT benefit packages [regardless of whether they have any race bias or not])...

- The JEWS prolly don't care... Half of them are prolly ignorant 'bolsheviks', who are still married to that ideal for some strange reason... The other half are prolly 'Zionist' banksters, media moguls, & journalists, who play along for greedy personal profit...

- The ILLEGALS have no fucking clue either way... Which usually leans towards the liberal candidate...

- The HOMOS are 'all in' the Obama camp because... well... they're HOMOS...

- The CHRISTIANS have about as much clue as the niggers & the illegals (IQ wise)... They'll prolly end up supporting Romney (not knowing why & feeling 'slimy' doing so)...

~~~

So... My scorecard, (as counted above)... DIEBOLD notwithstanding ~ electoral college wise... leans towards an Obama victory...

~~~

Fuck everything else tied to this useless election... Fucke the niggers, fuck the jews, fuck the homos, fuck the bankers, fuck the christian fundamentalists... It would really be better if Iran were to launch a nuclear strike against AmeriKa BEFORE the elections happened, but unfortunately, I think they're prolly 2 civilized to ever consider that option...

EDIT: Yeah... FUCK YOU (junkers)... Freddie's Dead...

http://www.youtube.com/watch?v=ECgBXkil7YI&feature=related

 

Sun, 07/15/2012 - 18:42 | Link to Comment PulpCutter
PulpCutter's picture

Now there's some REAL TeaParty economic analysis.  Just get back from church?

Sun, 07/15/2012 - 19:51 | Link to Comment Offthebeach
Offthebeach's picture

Typical lefty smug dis of sincere exploration of soul through.the choice of one's temple, mosque, church or meeting house.

Sun, 07/15/2012 - 21:48 | Link to Comment Monedas
Monedas's picture

Anyone who can use the word "nigger" in a non-hurtful way in advancing an argument gets a hat tip from me !           Monedas      1929        Comedy Jihad Committee To Re-energize Our Common Language

Sun, 07/15/2012 - 18:57 | Link to Comment monoloco
monoloco's picture

Why don't you tell us how you REALLY feel?

Sun, 07/15/2012 - 21:34 | Link to Comment francis_sawyer
francis_sawyer's picture

OK 'ZH'ers'... Here we go... Let's all join hands together & sing 'kumbaya'...

~~~

EDIT:

Yeah... Junk away MOFOS... (missed the previous link &/or ur certifiable DICKS)...

"Hey, hey
Love, love
Yeah, yeah
Huh, huh

Freddie's dead
That's what I said
Let the man rap a plan; 'said he'd send him home
But his hope was a rope, and he should have known

It's hard to understand
There was love in this man
I'm sure all would agree
That his misery
Was his woman and things
Now Freddie's dead
That's what I said

Everybody's misused him
Ripped him off and abused him
Another junkie playin'
Pushin' dope for the man
A terrible blow, but that's how it go
A Freddie's on the corner now
If you wanna be a junkie, wow
Remember, Freddie's dead

We're all built up with progress
But sometimes I must confess
We can deal with rockets and dreams
But reality
What does it mean
Ain't nothing said
'Cause Freddie's dead

Hey, hey
Love, love
Hey, hey
Yeah, yeah
Huh, huh
Love, love
Yeah, yeah
Huh, huh
Yeah, yeah
Freddie's dead

All I want is some peace of mind
With a little love I'm trying to find
This could be such a beautiful world
With a wonderful girl
I need a woman child
Don't wanna be like Freddie now
'Cause Freddie's dead

Hey, hey
Yeah, yeah
If you don't try
You're gonna die

Why can't we brothers
Protect one another
No one's serious
And it makes me furious
Don't be misled
Just think of Fred

Everybody's misused him
Ripped him up and abused him
Another junkie plan
Pushin' dope for the man
A Freddie's on the corner now
If you wanna be a junkie, why
Remember Freddie's dead
Huh, huh, huh, huh, huh
Freddie's dead

Hey, hey
Huh, huh
Love, love
Huh, huh
Huh, huh
Hey, hey
Love, love"

Sun, 07/15/2012 - 22:40 | Link to Comment jimmyjames
jimmyjames's picture

Superfly-

Great movie-Great real life story-Great sound track-

Curtis Mayfield--one of the smoothest-- RIP

http://grooveshark.com/s/Freddies+Dead/p1wJy?src=5

Sun, 07/15/2012 - 18:24 | Link to Comment Tom Green Swedish
Tom Green Swedish's picture

There are no more magic bullets left.  You cannot print until infinity. The next crisis will be a monster and could be around 3-4 years from now.  Just watch what all this deleveraging, and poor policy making will lead to. The government better hope it can find someone who has a brain this time.  But they will once again probably trash that person.

Sun, 07/15/2012 - 18:23 | Link to Comment bugs_
bugs_'s picture

To keep your Greek debt from having that unappealing droopy impaired look it needs to be continuously watered from the most pure keynesian springs.

Sun, 07/15/2012 - 21:04 | Link to Comment itstippy
itstippy's picture

"...unappealing droopy impaired look" - Har!  +1

Benny'd better pour lots more pure Keynesian spring water on his green shoots.  They're looking kinda - you know. 

Sun, 07/15/2012 - 18:27 | Link to Comment Dr. Sandi
Dr. Sandi's picture

 


Is Keynesianism Running Dry?

Who gives a rat's ass? It's skins vs. shirts. Looks like the skins are winning because a hell of a lot of us have already lost our shirts.

Sun, 07/15/2012 - 18:29 | Link to Comment yogibear
yogibear's picture

Bernanke and the Fed's Ponzi scheme is over!

Even with more bank stimulus. 

I see businesses vacating storefronts every few months. They should just bulldoze all these vacated storefronts.

A strip mall, built 4 years ago, have only 2 of the 12 storefronts occupied. 

The Tyvek all weathered flies in the wind of a partially McMansion built 5 years ago.

All signs of Bernanke and the Federal Reserve's success.

 

 

Sun, 07/15/2012 - 18:30 | Link to Comment DavosSherman
DavosSherman's picture

Is gold on a 45 degree climbout for any other reason?

Sun, 07/15/2012 - 19:28 | Link to Comment PulpCutter
PulpCutter's picture

Pictet (author of the post) is picking and choosing his/her facts; specifically ignoring the data from 2010 onwards.  Does he know we're more than halfway through 2012?

US total (public and private) debt/GDP has been dropping since 2010.  Same for South Korea and Australia.

http://www.mckinsey.com/insights/mgi/research/financial_markets/uneven_progress_on_the_path_to_growth

Choose your theory to fit the facts; don't choose your facts to fit your theory.

--------------------

From Kinsey report:

  • As of January 2012, the United States is most closely following the Nordic path towards deleveraging. Debt in the financial sector has fallen back to levels last seen in 2000, before the credit bubble, and the ratio of corporate debt relative to GDP has also fallen. US households have made more progress in debt reduction than other countries, and may have roughly two more years before returning to sustainable levels of debt. Deleveraging in the United Kingdom and Spain is proceeding more slowly, and these countries could face many years of gradual debt reduction ahead.
  • Understanding the course of deleveraging will be of critical importance both to business leaders, who will need to take a granular approach to strategy, and to governments. The report examines implications for business strategy and suggests that current macroeconomic models do not fully capture the impact of deleveraging on demand—so companies must develop their own views of how deleveraging is proceeding to find pockets of opportunity in the near term. Overall growth in the time of deleveraging is likely to be restrained, but the pace of debt reduction varies across nations and sectors and from place to place within nations. No single country has all the conditions in place to revive growth.
  • Sun, 07/15/2012 - 19:49 | Link to Comment Solon the Destroyer
    Solon the Destroyer's picture

    You are acting like a fucking dumbass. It is that very private sector develeraging that gives Bernanke freaking night tremors. He wants banks to lend. He's desperate for it. The lack of lending and the private sector deleveraging is a demonstration of the capital destruction that perpetually cutting Treasury rates wreaks upon a society. The U6 rate and the bankruptcy rate and the foreclosure rate are just as clear demonstrations too. But there's nothing Bernanke can do about the capital destruction he's fomenting. After all the Treasury has paper to sell--and the only way that can happen is by The Fed bribing speculators with front-running opportunities.

    And if you think public debt has been reduced you apparently haven't Googled "fiscal cliff" or read any financial news this decade.

    The government and the banks are allowed to engage in accountancy fraud. They do not have to enter liabilities on their books at present value like the entire friggin rest of the economy. This present value gives the actual liquidation cost of the debt;a cost which increases dramatically as Treasury rates slide down. For US Government debt it is presently measured in the quadrillions of dollars.

    Quadrillions.

    That's one helluva distortion on the government's and the banks' balance sheets. This failure to properly account is a big part of what allowed debt speculators to ruin the PIIGS.

    So tell me your ridiculous little story again about debt not being an issue.

    Sun, 07/15/2012 - 21:10 | Link to Comment RSloane
    RSloane's picture

    He isn't acting.

    Sun, 07/15/2012 - 20:03 | Link to Comment Barking Spaniel
    Barking Spaniel's picture

    I can't compete with PulpCutter.  He is too smart for the rest of us.  1+1 trillion= milk and honey flowing up from the streets.

    Sun, 07/15/2012 - 18:34 | Link to Comment apberusdisvet
    apberusdisvet's picture

    It is now fairly obvious that the end game for the perverted Keynesianism is Fascism, since all of the spending has benefitted only those in power, whether corporatively (including banking) or politically, and enabled not only financial repression but actual police state repression as well.  But of course this has been the Rothschild agenda all along, dutifully nurtured along by the Marxists, then the Progressives and their puppet presidents starting with Wilson and certainly all those from LBJ to Obama.  We can now surmise that all of the historical attempted and actual assassinations were those against Presidents who didn't want to follow the game plan.

    Sun, 07/15/2012 - 19:05 | Link to Comment Meremortal
    Meremortal's picture

    You were going along so well until your last silly sentence.

    That nutty girl from Manson's gang that took a shot at Gerald Ford was working for the Rothchild's? Surely they could do better than that, like by using a professional for example. And why no followup?

    The nut still in prison in Colorado for shooting Reagan was working for the Rothchild's?

    Dude. 

    There are much easier ways to deal with uncooperative capitalists.

     

    Sun, 07/15/2012 - 18:35 | Link to Comment blunderdog
    blunderdog's picture

    So what's wrong with shrinking GDP again?  It's gonna cost the bankers some money, right?

    Sun, 07/15/2012 - 18:50 | Link to Comment Meremortal
    Meremortal's picture

    In other news, Ron Paul's followers have failed to win him a speaking spot at the Republican Convention. Paul had to achieve a plurality of votes in 5 states, but only managed 4. Nebraska was his last chance, but caucus goers shut out Paul's followers.

     

    I don't support him, but would have liked to have heard him speak at the Convention. Oh well.

    Sun, 07/15/2012 - 19:40 | Link to Comment blunderdog
    blunderdog's picture

    If someone's actually representing a coherent perspective from "the people," you can make a pretty safe bet he won't get too far politically.  That's what the system is designed to prevent.

    Sun, 07/15/2012 - 18:54 | Link to Comment Meremortal
    Meremortal's picture

    deleted duplicate

    Sun, 07/15/2012 - 18:53 | Link to Comment carlosss1
    carlosss1's picture

    Yes, sure!

    The only keynesianism that works is militar keynesianism!

    Sun, 07/15/2012 - 19:39 | Link to Comment PulpCutter
    PulpCutter's picture

    The EU, driven by Germany, is practicing austerity, not Keynesianism. 

    The fact that Europe's GDP may drop in two years (agree) says Austrianism has run dry, and is predicted by Keynes.

    The US, on the other hand, has had increasing GDP, and decreasing total debt/GDP, since 2010.

    The UK's Cameron slashed spending (in a global economic crisis!?), saying "the increased confidence will strengthen business".  As a result, the UK has gone into a second recession, which Cameron called "surprising".  If Cameron had any experience running a business, he'd know that the Confidence Fairy is as real as the Easter Bunny; I expand when my customers buy more, not due to some politician telling me I can be confident.

    http://online.wsj.com/article/SB10001424052702304723304577365301140802744.html

    Sun, 07/15/2012 - 19:54 | Link to Comment johny2
    johny2's picture

    just out of interest what is the US total debt these days? in 2009 it was about 370% as % of gdp, has it decreased much?

    Sun, 07/15/2012 - 20:11 | Link to Comment buzzsaw99
    buzzsaw99's picture

    If there were no central bank there would be no national debt. Kill two birds with one stone I say.

    Sun, 07/15/2012 - 20:19 | Link to Comment PulpCutter
    PulpCutter's picture

    Total (public and private) debt/GDP looks like about 250%; see Figure 1 here

    http://www.mckinsey.com/insights/mgi/research/financial_markets/uneven_progress_on_the_path_to_growth

    Buzz, America had debt before we had a central bank.  The CB has nothing to do with it - that's Congress.

    Sun, 07/15/2012 - 20:28 | Link to Comment buzzsaw99
    buzzsaw99's picture

    The usa should not have to borrow its own currency PulpCutter. The central bank damn sure is responsible for THAT! Otherwise they would just print what they need and spend it. Paying interest only makes it worse over the long haul.

    Sun, 07/15/2012 - 21:08 | Link to Comment PulpCutter
    PulpCutter's picture

    Hard to argue with that.  We have a massive corruption problem.  The Fed transferred 27 TRILLION in crappy debt, out of the big WallSt banks, and onto the taxpayer (the books of the Federal Reserve).  That's the biggie.  Smaller, but still monumental scale: CorzineMFG, Mozillo/Dodd/Countrywide, the robosigners/"Linda Green" LOL - and that's just scratching the surface.  Where the hell are the prosecutions? 

    Instead, we send MARTHA STEWART to jail. ROFL.

    Biggest joke though?  The Tea Party has been co-opted by the crooks.  They have continually pushed to de-fund the WallSt regulators, and prosecutors.   THAT'S the biggest reason for no prosecutions; you have a handful of govt lawyers/DAs trying to go bring cases against huge legal departments of G-S, JPM, Citi, etc..

    http://www.capitalismwithoutfailure.com/2011/12/bill-black-on-incidence-of-fraud.html

    On why the fraud has not been prosecuted: It is hard to prosecute sophisticated white-collar crimes. And the defendants do have the best criminal defense lawyers in the world. So it is not an easy thing to do. The real problem has been a lack of resources directed to this effort. Black likens the number of agents assigned to the investigations to going to a beach in San Diego, throwing handfuls of sand in the Pacific Ocean, and wondering when you are going to be able to walk to Hawaii. Every year, with a million plus cases of fraud a year, if you prosecute a thousand of them or two thousand of them or three thousand of them, you are a million cases further behind every year. At one point the FBI declared that it was time to start going after the big guys... at which point Bush’s Attorney General Mukasey said no. He refused to even create a National Task Force against mortgage fraud.
    Sun, 07/15/2012 - 21:32 | Link to Comment johny2
    johny2's picture

    The increased spending through increased borrowing to increase GDP. Sounds like Ponzi scheme, and that is what it is. Of course, none of this matters for now, until the day the dollar dies a sudden death.

    I wish Monty Phyton would get together to make a movie about all this. 

    Sun, 07/15/2012 - 20:17 | Link to Comment Solon the Destroyer
    Solon the Destroyer's picture

    No. What they are experiencing -- not "practicing" -- is deflation, a phenomenom long predicted by the Austrians, and unseeable by Central Bankers, Keynesians and Monetarists even just weeks before the crisis hit.

    What they are "practicing" are bailouts, cheap money stimulus, monetizing of government debt, and capital controls. Keynesian Friedmanite doom, just as predicted by the Austrians.

    Sun, 07/15/2012 - 20:44 | Link to Comment PulpCutter
    PulpCutter's picture

    Austrians predicted we'd go to deflation?  LMAO - I doubt you'll sell THAT bullshit, even here at ZH.  Austrians have predicted a hyperinflationary meltup "within a year", for years now.  Instead, IBM is able to sell 3yr bonds at 0.75%.  Um...WHERE's the hyperinflation?

    You're got it just about perfectly backwards.  Avoiding deflation is the central concept in Keynes (you may want to read up a bit, before embarassing yourself further).  Krugman and others have been screaming that we're headed into deflation for years - they predicted it well ahead of time.

     

     

    Sun, 07/15/2012 - 22:49 | Link to Comment jerry_theking_lawler
    jerry_theking_lawler's picture

    i would guess that the Fed's policy of paying interest on reserves has 'hindered' an inflationary cycle. if this policy is reversed while the Fed maintains its current balance sheet, then I would guess inflation would rear its ugly head.

    these guys are not idiots. they know how to play the game.......or they think they do. if the Fed continues to press the Ctl + Print button long enough, then the genie will get out of the bottle. just my $0.02.

    Mon, 07/16/2012 - 02:06 | Link to Comment Solon the Destroyer
    Solon the Destroyer's picture

    Lol. That's about as revisionist as it gets. Milton Maynard would love you.

    No, the Austrian call is that the idiot Keynesian Monetarists will think they can avoid deflation and for the sake of short term hopium will fuck things up even worse, by monetizing massive public debt. Since they have conned our gutless leaders, the whole shitshow will destroy lives while maintaning the threat of the first ever global hyperinflation.

    You just keep posting your crap, unwittingly proving that very same point.

    Mon, 07/16/2012 - 07:07 | Link to Comment Inthemix96
    Inthemix96's picture

    Sorry pulpcutter,

    Anyone that brings up and then takes that fat cunt krugman as gospel is fucking first class shill.

    You dont pass the bullshit test mate, tata

    Sun, 07/15/2012 - 19:05 | Link to Comment JR
    JR's picture

    Policymakers need to be brave? Bernanke needs to be brave? Just which policymaker needs to step forward and be brave? Maybe one of the Fed governors will take this on and turn it around. Maybe Sarah Bloom Raskin or Jeremy Stern? Or Janet Yellen?

    Keynesian economics is horrible, of course it doesn’t work. But isn’t the overriding factor that’s causing all the problem theft? Grand larceny by the banks. They are taking all the money, they are taking all the value, they are stealing from the taxpayers, from small businesses, from the nations, from sovereign nations for Heaven’s sake!

    Obviously Keynesian economics doesn‘t work; Keynesian economics is theft. But if we could all just get together and write the politicians, tell them to be brave and bold and promote the virtues of entrepreneurship and business, then Ben and Sarah, the policymakers, will fix the problem  And the main thing is, if we could just get a whole bunch of Republicans in there, then all the effects of the crisis can be reversed. Yeah.

    Sun, 07/15/2012 - 20:09 | Link to Comment buzzsaw99
    buzzsaw99's picture

    But isn’t the overriding factor that’s causing all the problem theft? Grand larceny by the banks. They are taking all the money, they are taking all the value, they are stealing from the taxpayers, from small businesses, from the nations, from sovereign nations for Heaven’s sake!

    Well said.

    Sun, 07/15/2012 - 19:30 | Link to Comment marco1324
    marco1324's picture

    No sooner does the economy breathe, the black glove of $100 a barrel oil smothers it. And its getting no better folks.

    Do NOT follow this link or you will be banned from the site!