Sunday, December 16, 2012

Blind Eye

Greetings good citizen,

For this week’s episode of ‘descent into the maelstrom’ we have this purposefully vague and more than a little hopeful article on why the stock market is seemingly ‘divorced’ from the real economy.

THAT may help explain why, despite all the storm clouds hanging over this economy, professional investors appear willing to look past the poor data. In fact, money managers say they are more bullish about domestic blue-chip stocks than about stocks in emerging markets or the rest of the developed world, according to a recent survey by Russell Investments.

John S. Osterweis, chairman and chief investment officer of Osterweis Capital Management, says that the economic head winds notwithstanding, several long-term trends could support a new leg to the bull market in domestic stocks.

Among them are a possible rebound in the housing sector, a potential revival of domestic manufacturing as wage growth accelerates in China, and the tail wind that could arise from the boom in domestic energy production.

Mr. Dorsey at Sanibel points to yet another possible tail wind. “Think about what uncertainty causes,” he said. “It causes low expectations. And when is typically a good time to buy an asset class? When expectations and valuations are low.”

The above are the closing paragraphs from this NY Times article…trust me, you won’t find anything more concrete in the whole package.

Especially, er, ‘hopeful’ is the third paragraph where they cite a list of (highly relative) possibilities.

Loan me your blind eye so I can point to some of the features they, er, ‘gloss over’…

Let’s start with the ‘Only game in town’ part of the puzzle. And what they don’t want to point to is the ‘Secret of their success’.

Have you noticed the never-ending procession of mergers and acquisitions? That’s why stocks are doing well while the rest of the economy is at a dead stall.

Capitalism is all about Market Share and when you reach ‘market saturation’ capitalism turns cannibal.

That alleged ‘opportunity for everyone’ turns into market share for those who can afford to buy it.

Oh, and how do you ‘justify’ spending tons of cash for market share that would have been yours if you had just waited?

You throw a ton of (suddenly redundant) people out into the streets (and pocket all of those ‘salaries and benefits’!)

Which as we can see from the ‘labor force participation rate’ actually shrinks the overall economy!

Thereby increasing social unrest…but the peckerheads who wrote this article don’t take that into consideration…

Since you absorb the shares of the ‘target’ company, your shares naturally ‘rise’ because you have captured market share you didn’t have before…by eliminating a competitor.

But, as these assholes know, there is a downside to this variety of economic predation that walks hand in hand with diminished opportunity.

Eventually a very small handful of not necessarily intelligent people end up owning everything…and they don’t feel your pain. You lost, so you should sit down and shut up.

Didn’t get your turn ‘at bat’, not their problem!

Until you make it their problem!

Like yesterday’s ‘disenfranchised’ young man who did something totally senseless because he had absolutely nothing to lose!

And if that doesn’t bug you…you may not pass the test.

Worse…since this ‘nothing to lose’ phenomenon is spreading, things could get mighty frightening, mighty quick (and the idiots currently in charge have no clue how to fix it, except by playing to the ‘nothing left to lose’ crowds strength.

Did I mention our civilization is self-destructing faster now that the process is picking up steam?

What I’m really curious to see is what kind of ‘New Deal’ they are going to offer the marauders who threaten civil order?

The first couple of passes will be ‘Band-aids’ at best. Discounts on mortgages and guarantees on jobs that are so conditional as to be worthless.

We all know how the HMO bullshit ended up, you’re two bucks a week became two thousand a month (and rising!)

But not until after the publicly funded healthcare system was dismantled…thanks St. Ronnie!

No what I’m curious to see is if the people will fall for the same old crap they’ve been ‘force-fed’ for centuries or whether civilization will self-destruct due to the massive decay of trust and good will?

Pretty fucked up thing to be pondering during the season of peace and goodwill…but considering how commercialized it’s all become, maybe it’s not that fucked up after all.

Thanks for letting me inside your head,


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