Sunday, July 17, 2011

The symptoms are NOT 'the cause'

Greetings good citizen,

I’ve already posted once today but the more I thought about this one, the more it ate at me because the Symptoms are not ‘the cause’

But the real culprit — or at least the main one — has been hiding in plain sight. We are living through a tremendous bust. It isn’t simply a housing bust. It’s a fizzling of the great consumer bubble that was decades in the making.

The auto industry is on pace to sell 28 percent fewer new vehicles this year than it did 10 years ago — and 10 years ago was 2001, when the country was in recession. Sales of ovens and stoves are on pace to be at their lowest level since 1992. Home sales over the past year have fallen back to their lowest point since the crisis began. And big-ticket items are hardly the only problem.

The Federal Reserve Bank of New York recently published a jarring report on what it calls discretionary service spending, a category that excludes housing, food and health care and includes restaurant meals, entertainment, education and even insurance. Going back decades, such spending had never fallen more than 3 percent per capita in a recession. In this slump, it is down almost 7 percent, and still has not really begun to recover.

As we all know, if we flipped this rock over we’d find richer rich (and more of them) mostly ‘created’ by stock market shenanigans!

We are told the, er, ‘astounding leaps’ in market valuation have been attributed to ‘increases in productivity’ and most of that has come from the ‘global race to the bottom’.

Since there is no such place as the ‘cheaper there’ (that doesn’t involve criminal money manipulation) most of these increases in valuation are…what’s the best word…FALSE!

This is the hell of the debt ceiling charade, the pretense that we are ‘solvent’ in the friggin first place! You know and I know the nation as well as the rest of the world is bankrupt (on paper.)

The ONLY thing keeping the wheels spinning is ‘creative accounting’.

Which is to say it is only a matter of time before someone comes along and demands their money, only to be told they can’t have it (or they can’t roll over their debt, same result.)

Then the trainwreck begins in earnest.

This is the part almost nobody is prepared for. We will all marvel over the ‘abruptness’ of ‘the crash’.

But still we haven’t touched upon the ‘cause’ of the current, er, drought of consumer demand that Mr. Leonhardt lays out for us.

As I have been lamenting for many years now, nobody can survive very long in an economic desert!

The classic ‘ghost town’ is the perfect example of the end result of failing to protect local/domestic workers.

And there are ghost towns everywhere across these United States, they are not ‘restricted’ to abandoned mining towns (as those flag waving idiots would have you believe!)

So, why is ‘consumer demand’ falling like a rock?

Because the ‘economic desert’ is spreading like wildfire and our useless politicians aren’t doing a damn thing to stop it!

Why is that good citizen? Why has our society allowed the ‘importers’ to hold the rest of us as economic hostages?

Like the title of today’s first post, ‘whatcha gonna do about it?’

It had better be a hell of a lot more than shrug, your kids are counting on you!

Thank you for letting me inside your head,


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