|"As long as we have growth and prosperity who cares what figures are in the computers?" ~Popular Fallacy.||
A good word
May 29th, 2015
"The government on Friday slashed its gross domestic product estimate to show it shrinking at a 0.7 percent annual rate instead of the 0.2 percent growth pace it estimated last month. There was also a modest downward revision to consumer spending."
This Reuters News dispatch confirms the economic slump. The GDP dipped into negative territory in the first quarter of the year instead of the fractional increase first reported. The fact that consumer spending has been revised downward is a cautionary indicator, too.
There will be calls for more federal economic stimulus. There will be plenty of calls for consumers to get out there and spend more money they don't have on things they don't need. If the consumers play the waiting game and hold off on house upgrades, new cars, costly vacation trips and so on the 2008 recession will return to finish its work.
With the possible exception of Sen. Rand Paul there are no presidential candidates in either the GOP or Democrat camps who appear to know what must be done to begin repairs to the economic muddle. Carly Fiorina might, but her message hasn't circulated.
much stimulatin' goin' on," as former Sen. Fritz Hollings might put
Actually, we have no idea where Senator Hollings would stand today on the confusing issue of whether or not the federal government should keep attempting to revive the sluggish economy by continuing to borrow at the rate of a million dollars a minute. The liberal theory has always been that the government is obliged to pour money into an ailing economy to achieve healthy growth. But at this point it's much like giving a dead body a blood transfusion.
David Stockman notices that popular financial news media often argue against austerity and in favor of more government financial stimulus. He trots out lots of charts that demonstrate that going into the stratosphere of debt isn't working. AUSTERITY HOWLERS
Here's one of the graphs in Stockman's article. It shows the 55 year climb of federal government payments for social programs. The shaded vertical bars represent recessions.
With present public debt approaching $20 trillion the obvioous question is, "When does the transfer scheme stop working?"
"The Constitution is in a musty drawer somewhere; not even the Supreme Court justices can find it," opines the Daily Reckoning's founder, Bill Bonner.
When one hears a couple inclined toward homosexuality declare "We have a Constitutional right to marry" or anti-execution advocates say the Constitution prohibits the state from terminating even people convicted of the most heinous murders on the grounds it's "cruel and unusual punishment," it's clear that no one is paying much attention to what the Constitution actually says. Moreover, some of the amendments to the founding document would set the legislators of the late 18th century spinning in their graves.
But Bonner's point is this:
Bonner is an aging Baby Boomer who blames his own generation for a great deal of the muddle in which the world finds itself. He claims his expectation of an economic implosion is actually optimistic because it will help clear the confusion and murkiness the debt-money system has caused and possibly bring us back to a more affordable level of government, accompanied by reliance on sound money.
We overheard a report on NPR this morning concerning Hillary Clinton's visit to our town yesterday. Our expectation was confirmed. No mention was made of GOP candidate Carly Fiorina's visit Wednesday.
Last evening the local CBS TV station carried an enthusiastically favorable report on the Clinton appearance. The station was either unaware or did not have the people power to cover the simultaneous appearance of Carly Fiorina, also running for nomination to president by the opposing party...GOP.
To its credit, the local daily paper found space for a report of Fiorina's remarks.
Greecing the Skids
Money troubles in far away Greece don't raise many eyebrows down on Main Street, America, but this fiscal cliff-hanger holds plenty of drama.
Greece must cough up another $329 million next week as an installment on its International Monetary Fund loan. But Prime Minster Tsipras says "Our creditors' insistence on greater austerity is subtle and steadfast. Our government cannot and will not accept a cure that has proven itself over five long years to be worse than the disease."
HOWEVER, Greece's Finance Minister is less strident and is assuring the world that every effort is being made to work things out and he hopes that the June obligation to the IMF will be met.
Meanwhile, there's much grumbling among Greek citizens. Some are having second thoughts about Tsipras, et al.
Even though you may hold the title to your GM car, GM owns the computer code that makes it run.
Who In Their
Right Mind Would Want A Cashless Society?