Friday, October 28, 2011

Creative Accounting...

Greetings good citizen,

As usual markets are tanking now that it has become apparent the proposed ‘rescue plan’ for the Euro Zone is a day late and a dollar short…

But that didn’t stop the Dow from breaching 12,000 again!

Think about the abysmal state of the economy, good citizen and ask yourself by what ‘logic’ could the Dow, er, ‘Financials’ be over 12,000 points?

Perhaps we could reflect on how pathetic it is the only remaining industry in the US today IS the financial sector.

As I have opined repeatedly, if not for creative accounting we’d be bankrupt.

Here, Mr. Williams shares his analysis of the latest (captive) government figures:

No. 396: 3rd-Quarter GDP, October Confidence, September Durables Orders and Home Sales October 27th, 2011

Consumer Confidence and Sentiment Sink to Levels Never Seen Outside of the Worst Recessions

No Economic Recovery Is in Place or in the Works

Third-Quarter GDP Gain Not Statistically Meaningful

GDP Nonsense:  Consumption Surged 1.7% While Disposable Income Collapsed 1.7%?

Consumption up, income down…somewhat ‘counter-intuitive’ but Mr. Panzer supplies us with this informative graph

As I have pointed out repeatedly, the ceaseless off-shoring of our jobs has been creating an economic desert so large that the ‘safety net’ is collapsing under its own weight.

When government ‘transfer payments’ make up 25% of GDP, you got problems.

Mind you, this problem is, in the short term, ‘self-correcting’.

Unfortunately, this situation WILL NOT take care of itself, at least not in a good way.
A massive rally in US equities today led by financials as there was relief that Europe will be bailing out the sovereign debt of some of their members, and most importantly of all, the large European and US banks.

The US GDP came in well. Intraday commentary was provided, and it was a hollow victory as household income continued to decline.

I think the stock rally may have more to go, but it might take QE3 to take it much higher into year end. And if we do get QE3, we then go into bubble watch as financial assets inflate at the expense of the real economy.

This is what happens when one applies monetary stimulus to a broken economy.

It is no surprise that Jesse agrees with the sentiment that the stock markets are, er, ‘divorced from reality’.

Don’t you wish you could ignore reality too? (And get rich doing it!)

Ah, to be an investor in capitalist utopia, especially these days where if you make a bad bet, the public is right there to ‘bail YOU out!’

It must be frightening to suddenly become aware that you’ve been played for a chump all of these years. The only thing worse is suddenly waking up from the ‘conservative dream’
Where a non-existent ’benevolent’ corporation rewards you handsomely for spending your entire life as their vassal…

Where reality is if you don’t own the company, you’ve been pitched over the side long before you can collect your (full) pension.

And when you DO go to ‘draw your reward’ you find the fund didn’t perform as well as, er, ‘advertised/anticipated’, so now you are faced with managing on a whole lot less than you originally expected.

Who knew EVERYBODY would invest in Enron?

That’s the problem with ‘creative accounting’. You’re assured that everything is all right until you go to collect, then all of a sudden all you have is a pocket full of IOU’s!

And there isn’t a fucking thing you can do about it…

(Which is why I advocate stringing the bastards up now, Before they make us track them to the ends of the earth!)

A ‘promise’ is a powerful thing…it is what keeps cops on the job and teachers in the classroom.

It even keeps you returning to your worthless job, day after day, to catch a fresh bucket of shit to take home with you. (Because that’s how your boss thinks it needs to be…which is WHY he’s the boss and you’re not!)

Well good citizen, what do you do when that promise is broken?

They have NO INTENTION of providing you with even a fraction of all of the things you were promised in exchange for busting your ass every day of your adult life.

How does that make you feel?

Now ask yourself how long you’re gonna let them play you for a chump?

There IS a better way!

A Simple Plan, an idea whose time has come!

Thanks for letting me inside your head,


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