Sober Realist

The Worst Case Scenario (Someone Has to Say It)

"The Despotism of Dependency" --- we have arrived.

Government is not shrinking. Today's government consumes 45% of the economy by its spending, plus another 13% of the economy via its un-funded regulatory mandates - - leaving less than half of the economy to the free-market private sector.

"45% of our economy today is dependent on government spending & control."

Slow, gradual government expansion over time is not recognized by the masses which gradually become dependant upon it. This leads to serfdom to the state. America is more a socialistic nation, and less a free-market economy, then ever before in its history, because our total economy has become significantly more government-dominated and dependent. Our founding fathers are rolling in their graves and weeping for the children of this once great land.

We are being extin­guished and stupefied as a people, reduced to a flock of timid, subservient sheep of which the government is the shepherd.
mwhodges.home.att.net/...

Dollar's Purchasing Power Annihilated - The Chart They Don't Want You to See

I guess this chart helps explain why it now takes both parents working in the "Joe Six-Pack" household to make ends meat. Well at least Greenspan made ATM's out of their houses to take up the slack. Oops, the ATM is out-of-order. Now what?

Forget Goldman, Start Worrying About the Government

With numerous GS alumni in key government positions, GS has essentially become part of the government. You can refer to the government as a "GSOE" - Goldman Sachs Owned Enterprise. So both GS and the government are equally deserving of the public's wrath. GS, as well as politicians corrupted by campaign contributions, have no moral imperative to protect the well-being of this country and its citizens. Market Sniper summed up the situation best:

"The hubris of Goldman Sacks is breath taking. They no longer even deny it. They are the broker for the Fed and the PPT. They front run the PPT trades. Their server is parked right next to the execution server so they can almost at will, front run large block trades. Their people have been installed at strategic economic and political choke points throughout the system, a web that has been building since the beginning of the Clinton administration. They have been at the forefront of regulatory deconstruction. They are a huge supporter of Cap and Trade as that is the NEXT major bubble scheme and they are now positioned to take total advantage of that. They own 10% of the exchange that will be trading the carbon offsets, a market that is destined to dwarf the energy market down the road. All their other positions are in PRIVATELY held companies. Too good a deal to let you and I in on, that is for sure, including Al Gore's "little" scam company. Seems he is in partnersip with two very big ex-Goldman boys. Increasingly starting to look like a gangster economy."

Our government and the financial oligarchs have become one and the same. There can be no more illusions as to what is really going on and who are the real culprits.

Why Another Stock Market Collapse Could Be Imminent

vicelord,
A day of reckoning is coming. Exactly when and in what way and order no one can say for certain. But it is coming.
"The gap between the rich and the poor, while always large, is becoming alarmingly disparate to the point that America is moving rapidly closer to resembling France prior to the French Revolution and Britain prior to American Revolution with a few elite using their monied power to purchase political and legal access so as to maintain their hegemonic position, and to suppress and oppress the masses."

Jon Stewart Takes on Goldman Sachs [Video]

This country needs more people like you.


On Jul 18 09:45 AM Michael Clark wrote:

> So, Jon Stewart is what ruined America. I thought it was the mentality
> of the thieves at Goldman Sachs that ruined America. America's greatness
> comes from its values of freedom and equality, not from its values
> to cheat and steal and look out for number one.

Perhaps There Are Unseen Green Shoots

I wouldn't put much credence into this ECRI data. We are lying in the wreckage of the largest credit bubble the world has ever seen. Our current situation can be compared to no other:
"These U.S. leading indicator growth rates can in fact turn positive, but then turn negative again as in the depression. Lakshman Achuthan is conveniently only showing the indicators performance during the past “mild recessions” and not going back to the late 20’s early 30’s where the growth rates went positive for a while and then went back negative. We probably will follow a similar path since we are not experiencing a typical recession, we have entered some type of depression.
The question I have, is what is driving the current ECRI leading indicator growth rates up? If it is stock prices or oil prices from March to now, big deal. If it’s actually being driven by growth in manufacturing orders then that would be impressive. But that isn’t happening, manufacturing is still consolidating and shrinking (excess capacity big time….worldwide)."

““We are in a balance sheet recession,” said Laura Tyson, a former head of the Council of Economic Advisers during the Clinton Administration who is now one of President Obama’s economic advisors. “We haven’t gone through this kind of recession in most of the lifetimes of the forecasters. By the way, the models that forecasters use are the same models that missed the fact that we were going to have this recession. So let’s admit a lot of uncertainty here.”

At this point in time the market will grab at this piece of data because we are DESPERATE for good news and willing to delude ourselves that all is well, even in the face of overwhelming evidence to the contrary.
"Wall Street cheerleaders have displaced economic modeling with astronomy, peering through an opaque telescopic lens in search of enigmatic glimmers of economic light amid the nocturnal darkness of outer space."--Sheldon Filger

Why Another Stock Market Collapse Could Be Imminent

We have built a world of consumers who can be called the "have-not-paid-for-wha...
We've only paid off 2% of our consumer debt thus far? This is the most telling statement of all from your article. We are still eyeball up in debt and we have the government rolling out the cash-for-clunkers stimulus. I'm sorry, but that's like offering drugs to an addict that's going through withdrawals. It seems our government is perplexed as to how to deal with the problem. Let's start a "Feed the Pig" campaign to get people to save more money; no waite, let's get people to turn in their old, paid-for cars so they can finance new ones. "We have to spend more to save the economy." Huhh!?!
The consumer is trying to deleverage, but governments around the world have taken up the baton of debt accumulation to keep our failed economic model of debt-fueled growth going. "Debt-fueled consumption of consumers and companies is being replaced by debt-funded government expenditure."
Our current world economic model has proven itself unsustainable. A new one is required.

Forget Goldman, Start Worrying About the Government

"I do solemnly swear (or affirm) that I will support and defend the Constitution of the United States against all enemies, foreign and domestic..."
---Does this oath have any meaning at all anymore? I would suggest that GS and the rest of the financial oligarchs are a domestic enemy.


On Jul 19 04:18 AM Steven Hansen wrote:

> somehow we have equated being legal with being moral. how much of
> the governments or gs activities seem moral.
>
> is the usa becoming the "great satan"?

With bloated, TARP-assisted earnings, comes the return of good old class resentment: "It's not merely that Americans have, at least temporarily, abandoned the hope that they'll earn scads of money. It's the widespread sense that winners in this economy are produced by a game that's rigged."

Corporations raping the taxpayer cannot be described as "good old class resentment."

Five Predictions for This Market

Hey Chris B,
Talking about deals, we bought $750 worth of brand new luggage for $98 at Dillards last week. They were marked for clearance to make way for the new inventory. And of course jackets were on sale for 1/3 the original price. These types of sales will only increase with malls becoming ghost towns this year. Remember that commecial real estate is the next shoe to fall. With all these businesses going under, who is going to rent those vacant commercial spaces?...nobody.
Did you see the new s today?:

"U.S. private sector bleeds jobs, services slump deepens"
Wed Mar 4, 2009 11:19am EST
NEW YORK (Reuters) - U.S. private companies hemorrhaged nearly 700,000 jobs in February and the service sector slump deepened as the year-old recession showed little sign of abating, according to data released on Wednesday.
The private sector cut 697,000 jobs versus 614,000 in January, according to an ADP Employer Services report that suggested hefty employment declines are on the way in the government's more comprehensive payrolls data on Friday.
The service sector's decline accelerated in February, according to the Institute for Supply Management, whose employment gauge also remained at a depressed level despite its improvement from the previous month."This is a slow "U"-shape recession," said Kurt Karl, chief U.S. economist at Swiss Re in New York. "We are still sinking. There is no sign of a bottom."
"On aggregate, the services sector is more pessimistic going forward and it is contracting a bit faster. It's going in the wrong direction."
The service sector represents about 80 percent of U.S. economic activity.
It often resists the grip of recession longer than other areas, but in February, accounted for more than half of the total private sector job losses reported by ADP, reflecting the rapid deterioration of the economy in recent months.

Red Flag ----"WE ARE STILL SINKING. THERE IS NO SIGN OF A BOTTOM."

A Granular Look at the Stratified U.S. Consumer

Interesting post.
Now the "Upper Class seems to be the only fragment of US consumption that is propping up the economy."
The rich wanted all the marbles and they got them over the last several decades. Henry Paulson and the financial oligarchy have made sure that they've kept all of them too. But in doing so, they left none for the middle class. Rolling back the tax cuts for the wealthy that have been implemented over the last 30 years is assumed to be an inevitable swing of the pendulum with Obama. The decimated middle class can't afford any tax increases or they'll revolt.
***Checkmate***

Walter Cronkite, RIP. The veteran newsman died Friday night at the age of 92.

We're cynical because the bought-and-paid-for mainstream media is no longer an objective source of information.
"And that's the way it is."

The Federal Reserve Can Not Account for $9 Trillion in Off-Balance Sheet Transactions?

When you're dumping boatloads of money out of a helicopter, it's hard to keep track of every dollar.

What Inflation Looks Like In Real Life

People have been proclaiming the imminent demise of the dollar for the last 3 decades. My advise to all of you is not to count on it. There is simply nothing strong enough to replace the dollar as the world's reserve currency. Russia even admitted this the other day:

"Finance Minister Alexei Kudrin told reporters on the sidelines of the G20 finance ministers meeting that it would take up to 30 years to create a new super-currency, suggesting there was no unity in Russia on the issue."

American hegemony will outlive all of us here. And a lot can happen between now and 2040: revolutions, wars, famine and drought, pandemics, the creation of disruptive technologies, new geopolitical alliances. Do you remember the news magazine articles back in the 80's about Japan spreading its tentacles across the globe and economically taking over American and the world? I remember them well. The same is now being said of China. If you do some research on China, you will see that there economy is not as nearly developed beyond the export or die model, nor are they the bread basket of the world, nor are they blessed with abundant natural resources. Their 2 trillion cash reserves will be used up in a flash as they scramble to rearrange and restructure their export-dependant economy. And they have a big demographic time bomb of their own. Will China overtake the U.S.? Official estimates are that China is at least 50 to 100 years away from having a modern technologically advanced navy like that of the U.S. If America falls, the rest of the world will be crushed underneath it.

The Free Market Votes: Still No Change We Can Believe In

The amount of destabalization across the globe that this financial meltdown has produced thus far is scary. Another year from now and you may see major political upheaval sweeping the world. Prolonged and deepening Instability like this can bring about wars very easily. This is not a far-fetched prediction. The system is fundamentally broken and the present leaders are trying to reinflate the old system that got us here.

interkulti.eu/Junglela...