Utter Nonsense

What is ‘the economy’? It is us; we, the people. It is we who decide to get up and go to work in the morning, open or expand businesses, hire people… It is we who decide what and where to buy; or whether or not to buy in the first place. What is commonly referred to as ‘the economy’ is actually us.

The markets have now gone up six days in a row. I read somewhere recently that small investors have fled the equity markets in droves. This tells me that there’s no longer any depth to these markets; that it’s become solely a playground for professional hucksters, gamblers, gunslingers and speculators. Expect the markets to continue gyrating aimlessly. Eventually, even the professionals will grow tired and walk away. After that, you can expect to see only government generated statistics with no basis in reality.

The point I mean to make is that WE are what’s happening in this country. As long as we continue to sit on our hands and wait till some competent leadership emerges, our nation is effectively on strike. Revenue flowing into government treasuries is down and falling. Good!

This is another instance in which the vacuous state-controlled media is not doing us any favors. They report we are going into or coming out of a ‘recession‘. This is the wrong way of looking at it. We are on strike! They say, we may be in or heading toward a 'depression' when, in fact, we are depressed by the quality of leadership in Washington and in our States.

It’s been said so often that it’s become easy to overlook, but government does NOT create jobs. Government only creates bureaucracies that wind up costing us money. So when Barack Hussein Obama promises to ‘save’ our jobs, he’s talking utter nonsense.

Something Has Happened

The world’s economies are imploding. Not that it makes much difference now, but I ask myself, “Did it start with the housing bubble in the U.S.?” Did the insane policy by our government forcing the banks to lend to people who never had a prayer of paying it back result in generating of so much publicly traded toxic paper that it ended up compromising currencies world-wide?

If so, how long will it take for nations around the world to start pointing fingers stateside? Has their reluctance to do so been due to their own disregard of economic principles? Clearly, the integrity of the dollar has been hurt. So far, the banks have absorbed all the blame. At what point will banks drop the pretense and tell what really happened? That what they ended up doing was in response to existential threats from our political class who urged them: First, to continue lending; and, second, to deal with the fallout creatively in anyway they could - short of naming names, of course. As long as the current crop of political elites remained in power, banks were assured, they would be protected. And the banks played the game.

Market signals are oracles. Oracles have no reason to lie. Their integrity is impeccable. Only men can twist the veracity of said signals to suit their own designs – or to ignore them entirely. The rising price of gold, the instability of equity markets, and chronically high unemployment all expose the slight of human hands and the effort to achieve something outside the realm of possibility. Oracles are blunt. They scream the truth amidst the blizzard of whispered lies.

Incompetence? I hardly think so. The oracles are screaming louder. “Name the culprits!” they scream. “Understand their motives!” As the Obama administration (through its mouthpiece, The New York Times) continues to advocate a doubling down on failed policy, we can almost envision the pillow being lowered over the gasping head on the sickbed. Death panels. Rather than taking the screams as proof of potency; rather than taking the oracle’s screams as a warning; the screams must be stifled at all cost.

Last night there was an earthquake off the coast of India. At one thirty in the morning the birds awoke and went nuts. In Chennai, it was a pleasantly balmy night and air conditioners were for the most part turned off - windows open. It took most people till sun up to find out that something had happened.

They Don't Fear Elections

Markets, no matter what you think of them, are a sounding pole (or line) that measures future economic activity. The markets in and of themselves are not the problem. The problem is political volatility. Traders make money whether the markets go up or down. It is the movement of markets that generates money. Iraq's market reached its highest point just before America invaded. This was not a sign of confidence. It was a market in its death throes.

We all assume that the next election will solve everything for us. We eagerly await November. It is possible that the markets will rally in anticipation of a Republican sweep. This rally has the potential of being like a prisoner, having just been released after a long confinement, now standing in front of his house. He rushes across the lawn, his heart overflowing, eager to see his wife and kids. As he opens the door, he trips the wire that sets off the explosion that levels the house.

Inflation could be the charge, or social unrest, or a war. Too many fuses have already been lit; too many surprises converging dead ahead. I believe the only thing that's keeping us afloat today is our sluggish economy. There's not enough punch currently for the fireworks to proceed. Once it takes off, God help us!

These people will not give up. They’ve come too far. Isn’t it strange how they don’t seem to fear elections?