Gedankonomist

Will a New Gold Standard Make Our Future Brighter?

"These two economists have come to the conclusion that "[d]ropping gold did work" i.e. that abandoning the gold standard has somehow shortened recessions and reduced the inclination to raise as many tariffs."

In a way, these two charlatans are correct. The system has been "very very good to them;" they get nice fat salaries at some over-rated academic institution, they get this and that award, they get to sometimes go on CNBC, etc., and all they have to do is spew establishment propaganda.

So how do you expect them to say otherwise?

Chart of the Day: Gold and the Dow

Awesome chart!

Congress and the Fed: An Epic Game of Chicken

"If the purpose of Fed independence is to keep monetary policy independent from politicians, who always prefer inflationary policies..."

And the shadow government that wants to keep the FED "independent" (read: unaccountable), they want what? What's best for you and me?

Duh!?

Chicago Fed Index Increase Suggests the Recession Is Over

Question: How is the "National activity index" defined? In these days where the federal government considers hamburger flipping "manufacturing," I'm a bit skeptical. What sort of "activities" are being considered? Standing in the unemployment line? Illegal immigrants running for the border? The FED ratcheting up the printing presses?

The Recovery Process: It Takes Time

What about the inventory of cash manufactured by the FED (i.e. the "bailout")?

I hear that only about half of that "inventory" has been "liquidated." When that "inventory" finds it's way into the economy, it might increase GDP, but only before you adjust for inflation.

"Economists have been ramping up their estimates for third quarter GDP because they understand that the record pace of inventory liquidation must cease, which will benefit manufacturing."

Will Ignoring Past Mistakes Result in a 20-Year Bear Market?

More mature, perhaps. Like a man in his 80's ready to keel over. But stable? The FDIC?

Consider when a bank fails and the FDIC takes over. Where does the money come from? The US government is broke. It spends more money than it takes in. Some of the FDIC money comes from China. But alot of it is simply printed out of thin air. This is stability? This is SOCIALISM!

"I have said that the current deleveraging cycle is actually not all that similar to the Great Depression – primarily because our economy is much more mature and stable, and also because there are certain safeguards in place that help prevent such an event from occurring again (the FDIC is a great example)."

New 'Crash' Warnings for U.S. Markets

Or, what he means is if he had the money just handed over to him, he'd invest it as such.

It's like when you have two teenagers, one is given money only after he has done his chores, and the other is simply handed the money. Which of the two is going to "blow his wad of cash?"


"Interestingly, though, two days later Rogers also said (in a CNBC interview) that if he “had a million dollars” to spend today that he would be buying commodities, specifically coffee, cotton and silver – calling the prices for these commodities “very depressed”.

Presumably, if Rogers were to buy any stocks at the the present time it would be companies who produce those commodities. While it is very difficult for most retail investors to buy into coffee and cotton producers, likely Rogers would not be averse to buying silver producers (i.e. miners).

Indeed, this seems to be exactly what Rogers was implying, since he advised “shopping around” for countries where these commodities were undervalued. "

What Recovery? Unemployment at 25-Year High

Considering that the government does not account for unemployed no longer seeking employment, unemployment is probably much higher. It will continue be high until Americans go back into manufacturing. This "service economy" is what is really unsustainable. We need to make stuff again. The government needs to get off our back before that happens though.

The Taxman Comes Knocking

I'd like to see these data adjusted for inflation.

Also, I noticed that in one of the charts, the taxes collected by the US were greater than spending (1998 to 2001). This was the famous "surplus" the US government and its shills in the media kept harping about. But for at least one of those years, there was no surplus, but rather at best a small deficit. This is because the income and spending data were projected data for the the next year. If you were to go to the data the following year, you'd find that these "projections" were not quite correct, and of course the "projected data" were skewed in favor of a lower deficit, or even a surplus. So the data being presented here are likely these same "projections."

But that's the federal government for you, who tells you that flipping burgers is "manufacturing," that you're not really unemployed when you've given up looking for a job, and that "global warming" is a crisis which requires us to do what?--further lower our standard of living.

Households Cut Back While Government Debt Grows

That's what I might call "unsustainable."

On Sep 29 06:20 AM User 353732 wrote:

> These figures illustrate with frightening clarity how the Parasitic
> Economy is now squeezing and draining the Productive Economy.
> There will be 4 consequences, without a reversal of trends and reform
> of Wash Dc and Wall St:
> 1. Increased collectivization of the economy with Big Business becoming
> willing collaborators of the State(the European and Japanese pathologies)
>
> 2. Structural changes in the economy that severely limit net new
> job creation and embed a high unemployment/underempl... rate, with
> the concomitant increase in the size of the Lower Class at the expense
> of the Middle Class
> 3. A sharp reduction in new business formation and investments in
> innovation because the risk and credit environment will be hostile
> to new entry, start ups, innovation and small business(Big Business
> will generally be content with this as will Wall St)
> 4. A further concentration in income, wealth and decision making
> over resource allocation as the Upper Class continues to expand its
> share of a very slow growth or practically stagnant economy. The
> Upper Class will mostly gain at the expense of the Middle Class whose
> real income and net worth will continue to erode as will access to
> affordable credit in the right amount at the right time: retirement
> will cease to be an option for a large majority of the Middle Class-----disability
> will become a form of retirement....
>
> The Greater the role of Govt in appropriating and allocating national
> resources the more Diminished will be :
>
> 1. The long term wealth creating capacity of the US and adaptability
> of the economy(the economy will become much more brittle)
> 2. US role in global trade,capital and talent flows and in global
> innovation especially in energy
> 3.Influence of the dollar in world monetary affairs
> 4.The Middle Class
> 5. The Constitution
> 6. The optimism and confidence of ordinary Americans

Plunge Protection Team Attacks BofA: This Ends Now

Well, why do people pay millions for pretty paintings? Thousands for a bottle of champagne? They aren't useful for much. Or buy a huge oversized truck when a much smaller vehicle will do? Why do pro sports players get paid so much?

The market is what it is.

On Apr 30 12:25 PM wobatus wrote:

> It has a 5,000 year track record, but why? People accept it, but
> why? It isn't oil. It isn't wheat (perishable, but valuable).
> It isn't coal. Or a forest. Or copper. Or water.
>

Swine Flu Fears Pulling Down Markets

This is neither a bear or bull market. This is a "wildebeest" market.

E.g. see: tinyurl.com/de9swr

The U.S. Is Spending Its Way Out of the Recession

"What most people don't understand is how government spending helps to soften the recession."

So how does the government spend money it doesn't have, and further, how does spending money you do not have, "soften the recession?" And what do you mean by "softening the recession?" Socialism? Speak in clear terms so people can understand you. Not like a Fed chairman. No wonder "most people don't understand."

Does the IMF Warning Indicate a Repeat of 1930s Banking Crises?

As long as we have the FED, we will have these quasi-Ponzi-scheme booms and busts.

What Will This Crisis Lead to?

1913 was the crisis point approximately 100 years ago. That's when we got the FED, the 16th and 17th amendments and unless I'm mistaken, liquor prohibition. And shortly after this, Woodrow Wilson, Col. House and Winston Churchill manipulated the US into the "Great War" by arranging for the sinking of the Lusitania. This of course, paved the way for Hitler's rise to Power, as well as our own little dictator who caused a recession to turn into a depression.