Friday, May 27, 2011

The Cycle Of Volatility And The Deluded Human Mind - Part Deux

Back at the end of March we put up the original post of this name.  It was an open ended post without any context or further information.  I wrote at the time I would put up a follow on post explaining its context in a week or two.  Well, that week or two has passed and this is the follow on post. 

Cycles are part of our every day life.   We see cycles throughout the natural world and the universe.  The cycle of our heart, the gestation cycle of life,  the daily cycle and the seasonal cycle are but a few of countless examples of cycles.   There cycles that last seconds and there are cycles that last thousands of years.  There are cycles that we clearly don’t recognize nor do we understand.  And there are cycles well too long for anyone alive to even recognize as cycles.

One of the major themes on here is that we are in a cycle of volatility.  And, as such, the linearity of the last few hundred years is no longer applicable.  In other words, as it relates to finance and current economic ideology, the world as we know it is over.  These are failed ideologies never to rise again.  Everything society  thought they believed is coming into question.  Everything society thought they believed is being exposed as a massive delusion.

So, what were the two charts I put up in the first post at the end of March on The Cycle of Volatility and the Deluded Human Mind?  The first chart is the 21 year view of the Dow leading into 1929.  The second is the 21 year chart of the Commodities Index leading into 2008.   Both charts are essentially mirror images of one another.  A long period of range bound movement followed by an explosive and criminal financial bubble, one in equities and the other in commodities.  And both charts span an entire generation; a cycle in itself.  enough time to delude an entire society and an entire world as to a new economic and financial paradigm (house of cards) while prior generations, who learned from prior economic stupidity, fade into obscurity. 

Below is an updated commodities chart of the one posted back in the final days of March.  Our initial post on The Cycle of Volatility and the Deluded Human Mind was posted coincident with that last green candlestick on the chart below.  Or the last “up” month for price.   Almost immediately after our initial post, commodities markets started crashing.  Many commodities were limit down many days as the Ponzi scheme started to unravel.  And oil had its largest single day drop.  Ever.  Now, Goldman Sachs, Morgan Stanley and other perpetuators of this massive attempt at rigging markets are bullish on commodities once again.   We shall see.  A very bearish monthly formation has taken hold before commodities were able to regain their old highs.  And, just at the world’s volatility is picking up again – volcanic and seismic activity over the past few months, debt crises again, economic uncertainty in the reported data, job creation lagging once and Wall Street is the most bullish on commodities and financial markets since the collapse in 2008.  And the perpetuators of this con, Wall Street firm’s stock prices haven’t made a new high in a year.   Will this end with the same incompetent stupidity of all of their other Ponzi schemes.  Including the parallel fraud used in this post, the 1929 collapse – a similar environment to today but instead of equities, it is now commodities – the new investment class that pays nothing and earns even less.   

To the extent that Wall Street gets away from book value, it is headed into potentially dangerous areas of thinking.  It then introduces factors – chiefly the notion of increasing future earnings – which are very difficult to measure and which therefore may be badly measured.  -- Benjamin Graham, most likely the  greatest investor of all time

Quantitative finance and commodities investing are all based on factors.  All of it.  And all based on future earnings and thus earnings-driven demand for commodities.  And none of these factors will ever shield financial idiots from the volatility of the real world.  These schemes are nothing more than creations of the ego.   And as we have said before, in the cycle of volatility, the institutions of ego are subject to failure and collapse.  Tens of billions of dollars wasted.  Trillions of dollars of economic opportunity lost on employing people in ridiculous schemes.

Inflation is too much money chasing too few goods and services.  That is not what is happening in the world today.  What we have is too much speculation in financial commodity markets enabled by derivatives, leverage and a banking system able to print money out of thin air to commodity prices through the roof. 

The many remarks of people who state that we are going to experience asset deflation while commodity inflation are ridiculous.  They don’t understand what is going on in the commodity markets.  Commodities are all going to bust.  It’s just a matter of when the fraud and corruption collapses as it always does. 

This is nothing new.  We have written extensively about this scam over the past six years while every financial commenteur, bull or bear, in the U.S. has been deluded by the brainwashing of a corrupt financial system and its latest scam, commodities investing.   Let’s look at an example we wrote about before the first commodities collapse.  It takes 5 cents to mine a pound of copper.  Regardless of the inflation rate or value of the dollar, the price of copper has never exceeded 50-60 cents in the last one hundred years.  It has recently been at near $5 a pound.   That mark up of  10,000% between cost and price is because of one dynamic and one dynamic alone;  Wall Street has spent billions of dollars creating an Enron-type  trading environment for energy and commodities.  And when our government’s bailout of the criminal class took place back in 2008, it simply allowed them to reignited the same failed and criminal commodity speculation.  This should be as no surprise since Wall Street was behind the original Enron and most people don’t realize these same financial firms were penalized billions of dollars for their involvement in Enron.  What should have happened is they should have been criminally-investigated just as Enron was.  Instead we have simply allowed the monster to become so large that it now murders people around the world who are unable to pay skyrocketing costs for commodities including food.  This whole dynamic is only possible because commodities are valued in dollars and because the dollar is the world’s reserve currency, thus allowing Wall Street to manipulate prices and extort a massive tax on any consumer or user of commodities around the globe.

It is simply supply chain intervention.  The insertion of a tax by financial mobsters.   It’s the same type of thuggery tax that the mafia extorts from businesses who operate in their neighborhood.   And as I highlighted before, RICO racketeering laws used to prosecute the mafia and organized crime should be used to prosecute Wall Street.

Some commodities markets are small enough to corner with minimal amounts of money, especially due to the explosion of commodity derivatives, created by Wall Street, that allow heretofore unavailable leverage.  Be that gold, silver, corn, wheat, lead, oil, rice or whatnot.   Once it creates the infrastructure of financial trading and leverage needed to mint massive profits at the expense of others, Wall Street needs to convince society on all of these “investments” to make their Ponzi schemes a reality.   And entire industries have been built upon these massive Ponzi schemes.  And now your pensions are invested in this scam because advisors from Wall Street needs to create a herd mentality to mint its massive taxes. 

I even know farmers participating in commodities Ponzi schemes.  Grain trading firms encourage farmers to hold their crops in an investment pool thus artificially limiting supply as these firms in concert with hedge funds and Wall Street, are then able to use this scam to ramp prices artificially higher for massive profit.  People can’t feed their family?  Who cares?  Not the Wall Street sociopath.   This dynamic is exactly what we wrote six years ago about what happened in the roaring 20s with stock pools.  Instead now it’s commodity pools, insider trading and packs of hedge funds that accomplish the same dynamic using leveraged financial derivatives in bubble stocks, commodities, etc.

This type of extortion and predatory finance is no different than the state-sponsored extortion of genetically-modified foods around the world or the extortion of society to bail out Wall Street criminals or the extortion of other corrupt states to do the will of the American war machine or the extortion of a fraudulent health care system.  It’s all driven by selling out our government to rig the game in favor of massive corporations who are able to price their payoffs of government beyond the financial reach of any other voice in Washington.    The housing bubble is small potatoes.   The corruption in our political, banking and corporate system is massive and transcends all facets of our lives and our society.   All of this and substantially more is enabled by a completely corrupt financial system and a captured, fascist government.

Because of this criminal behavior, a private banking system is able to determine what society values as economic opportunity.  And, frankly, much of our leadership’s social and moral values.  As Wall Street creates its endless Ponzi schemes, whole new industries spring up to support its massive fraud.  And legitimate enterprises make plans and investments determined by anticipated outcomes that never materialize.  Let me give you a few examples. 

First, the boom in the late 1990s.   Millions of unsustainable primary, secondary and tertiary jobs were created surrounding this phenomenon.  People and companies started ventures totaling billions of dollars.  And anyone with a wild-haired idea got funding and went public.   Millions  chose degrees in computer science or jumped into the field of finance or companies made massive investments that never paid off or governments started projects because of higher tax receipts.  And then secondary and tertiary businesses popped up in supporting roles.   Business plans were changed and debt taken on to expand to serve this new Ponzi scheme.   The impact on the economy was endless.  People, companies and communities changed the way they did business to take advantage of this dynamic.  But it was all a fraud perpetuated by a private banking system run by criminals. What came out of this that was sustainable?  Almost nothing.   It all collapsed. 

Then came the housing and real estate bubble.  Millions of people jumped into the field of finance or started their own interior design business or became architects or started construction businesses or mortgage businesses or became home inspectors or overbuilt commercial real estate with the same dynamics.  Business plans were made and debt was taken on to expand businesses to serve the Ponzi schemes.  And software companies popped up to service them.   Real estate sales positions exploded.  The list is again too endless to document.  And it was all a fraud created by a criminal private banking system.  How much of that was sustainable?  None of it.  

Then we have quantitative finance.   Millions of new jobs in finance and supporting roles.   Thousands of hedge funds or thousands of scientists and engineers now working in finance or new quantitative software companies or the IT infrastructure boom to support them or the billions of dollars spent developing the trading algorithms used on Wall Street or the many trading advisory services and selling these schemes to pensions and retirement funds and on and on.  It too is unsustainable.  It too will fail.   

Then there is the commodities scam.  Maybe the most criminal of all scams because of its impact on people around the world.   Massively distorting costs in basic necessity products that the world’s poor and underprivileged rely on to live.  At the same time, encouraging farmers to overinvest in equipment and paying exorbitant costs for land that will eventually come crashing down when the scheme unravels.   Encouraging pensions and investments for our society to invest in ridiculous notions that no one understands.  Thus threatening our social stability (At the link, others are finally starting to understand the criminality of it all.)  and leaving us holding the bag for their criminal negligence.  Peak oil, manmade global warming, the Chinese miracle, a permanently high commodities plateau from Malthusians including Jeremy Grantham who recently wrote, ridiculously might I add, of such a dynamic.  Just as Alan Greenspan wrote of a permanently high plateau for the American economy right before it imploded.

Students lined up to pay upwards of a quarter of a million dollars for an education.  To learn theories based on bullshit.  And to participate in a career that is nothing more than a delusion created by a financial bubble.  So, how much of the world around you is actually delusion based on brainwashing…. or adaptation

All of these schemes are doomed to fail.  None of them create capital.  Instead, they simply shift capital.   And as such, the limits on capital will eventually be reached.  That means we are guaranteed crisis after crisis as this dynamic unfolds.   And this shifting is from the world’s poorest people to the world’s richest.   And because of shifting capital as opposed to creating it, we see that the concentration of wealth around the world is at incredibly distorted levels.    The real crime is not debt slavery.  It is economic slavery.  Economic slavery creates debt slavery.  Those who are accumulating the most capital are the most criminal and the most complicit; even if it is acting as a useful idiot.   These are crimes against humanity of the most grave scale.  They are crimes that rival those of the most oppressive and evil regimes ever to come to power. 

These crimes are timelessly part of an economic system that is always being subverted by evil.  We saw it one hundred years ago and we see it again today.   We saw it in the S&L crisis under Reagan.  The junk bond debacle under Reagan.  The start of the lobbyist bubble in Reagan.  We see it in the criminal credit default derivatives scam.  We see it in a perpetual underclass of Americans denied access to capital and denied since this country was founded.  The list of abuses are endless.

We need an economic rule of law to protect us from evil.   We need an economic constitution.  These are but examples.   We could cite healthcare, investment banking, mergers & acquisitions, private equity and on and on and on.  And the same holds true throughout all of history of private banking.  It’s a never ending list of fraud that serves a very few and endlessly destroys the lives of everyone else.  It perpetuates racism, class struggle and underprivileged.  It perpetuates endless bribery of our government and corruption.   It subverts democracy.  And it keeps us from having an economic model that serves democracy.

Did all of those MBAs headed to Wall Street over the last decade make a brilliant educational decisions?  Or are they simply unknowingly complicit in our own destruction?  Deluded by personal desires of power by a system that perpetuates fraud.  Destruction enabled by Harvard, Yale and other elite schools that pump out these worthless degrees embracing junk economics and voodoo finance.  Has our economy adapted to become something new and vibrant as Treasury Secretary Paulson believes or have the assholes on Wall Street effectively forced society into jobs and careers that are completely unsustainable yet  serve the greed of the most power-mad in society?  Have you actually learned anything during your life time or are you simply adapting to a system of fraud and corruption to survive?   And is it really any different than the brainwashing of society that the Nazis or the Chinese communists so effectively imprinted on society? 

We live in an unsustainable world created by the endless supply of dickheads and morons like Alan Greenspan, Al Gore, Bill Clinton (The worst President in the history of the United States), Newt Gingrich, Hank Paulson and others who undemocratically believe they are uniquely qualified to tell us how our economy and our society should be run.  And the jobs that we should desire and those which we should offshore?  This is a world of tyranny where economic opportunity is determined by the most incompetent power-mad, emotionally-unstable elements in our society.  

What is really real and what is a lie created by delusion , avarice and power?   I’ll tell you what is real.  All that comes from within.  Your self-expression, your dreams, your love for your family and friends.  The rest?  It’s all an illusion.  And it’s an unsustainable one at that.  The status quo’s con game is over.  And there is nothing they can do to save it.  Now we wait for the real world to reveal itself.  And with it, comes enlightenment as to what truly is real.  You are real.  I am real.  The world that con men have created is nothing more than a bad nightmare. 

Private banking monopolies with a primary motive of profit rather than serving society is a relic from the past.  It has no effective use in the development of democracy.  To seek to institute a gold standard and keep this model is putting lipstick on a pig and will return us to a time when corruption was just as rampant by the for-profit banking system’s denial of capital to underprivileged and to many of society’s most gifted who could give economic opportunity to and employ countless Americans if given access to our own capital.  We need a public banking system that first serves democracy and all Americans.  If we want a private financial system to compete with ancillary services, that is fine.  But we live in a tyranny that is enabled by private banking.  By denying Americans their basic economic rights through predation.   Wall Street is nothing more than a criminal enterprise.  It serves no purpose.  None.

Most people, including most assuredly all politicians,  don’t take the time to think about how private banking shoves people in the direction of personal motive rather than human developmental needs.  Everything our society values economically and often socially and morally is determined by a false moral system created by for-profit banking.   Anything that the individual  wants is irrelevant.   Private banking creates a false value system perpetuated by unstable crooks. 

So, have you ever asked why?  Or did you just accept what politicians and Wall Street was telling you?  Did you ever question or did you just go along with the herd?  So, how many other things in your life fit into the same dynamic?  What have you really learned in your life?  Seriously.  And how much of it was simply adaptation?  Or even delusion or illusion?  

We “learn” from our parents or teachers or friends or Bugs Bunny or politicians or Wall Street or the mainstream media or South Park or MTV, and they learned from their parents or teachers or friends or Bugs Bunny or politicians or Wall Street or the mainstream media or South Park or MTV.  Continue this pattern over a whole society. A whole generation. Multiple generations.  Learning or social adaptation? Are they one and the same? Is adaptation the same as truth? Do I even need to ask?  What have you really learned other than what you were told you should learn by social influence?  How much you learned in school is completely undeniable truth?  Your mind should always remain free of the clutter that is adaptation or conditioning. To remain open to new thoughts, new experiences, new ways of thinking.  Open to things you “learned” were impossible, because they are most likely possible or even probable.  Or as a wise man said long ago, to be as a child.   "That can never happen"  or “That can’t be done”  is most often a myth perpetuated over and over again throughout history. Each day should be started with the intent of increasing our knowledge.  The intent to learn.  The intent to prove the impossible is in fact probable.
Every so often there is a student who asks why. Or who challenges their teacher as to the voracity of their beliefs or conclusions presented as truth. And, that student does so repeatedly. Many times those students are identified as problematic. Unruly. Unable to take guidance. Disruptive. They don't conform.  They don’t adapt.  Are they unruly or problematic or are they questioning the truth of social adaptation? Are they simply spreading their wings of free thought?  Questioning the questionable?  Are they showing signs of future potential to positively impact or even change the world?  Is nonconformity an even greater predictor of future ability than a student receiving perfect test scores aka conformity?

Some years ago, we coined this environment as the rise of the bureaucrat; the blood sucking CEOs, politicians and banking cabal who has chosen to enrich themselves off of the backs of others including underpaid Americans, slave labor in emerging markets and financial speculation – all at the expense of society and community.  These are people who create no wealth but instead simply steal it.  

Nature loves diversity.  When that diversity is lost, populations are at a higher risk of collapse or crisis be that the food supply, animal populations, insects or even the whole ecosystem.  The same holds true with our economic ecosystem.  The fact that this economic catastrophe is dominated by bureaucrats who have effectively monopolized the decision making about our economic environment, stifles economic diversity and society’s ability to produce its own capital.  So, we have to borrow it from outside of our borders.  The Soviet Union of the United States.   Contrary to many who believe our economy has become too complex, in actuality our economy may be much less complex than at any time since the start of the Industrial Revolution as a small number of bureaucrats rig the system for their benefit.  We should expect the outcome to be no different than in any other instance of nature where diversity and natural complexity has been subverted.  Eventually, the system will again see crisis.   Elites have won nothing.  Their desire for ever more is never enough for the empty soul.  They have sealed their fate.  Karma is a bitch.

A private, for profit banking system determines who gets access to capital in our society.  It effectively sets the economic rules.  In our society scientists, artists,  researchers and entrepreneurs, who create the capital and future wealth of society, are denied access to capital while the corporate state lavishes itself.  So, instead of millions of Americans being paid a living wage, they rot.  In places like Compton, Detroit, and New Orleans, they rot by the millions.  Our prospective future leaders, possible discoverers of future medical advances, Nobel Prize winners and vibrant contributors to society live in poverty while completely incompetent bureaucrats make the decisions on who gets access to capital and how much.  So, instead we see vacuous reality shows like the Kardashians making millions of dollars,  we see corporate bureaucrats making tens of millions, we see professional athletes making tens of millions and we see banking criminals making tens to hundreds of millions.  All determined by what values bureaucrats place on society and community.  They share nothing in common with most Americans.  Their view on character and morality is as distorted as their sense of self.  A private for-profit banking system is and always has been completely at odds with capital creation and human development.  It is at odds with the values of democracy, economic democracy and economic opportunity for all citizens. 

We need a public banking system that serves the need of human development and democracy.  One that allows people to create economic diversity and self-determination.  Private banking is a relic of concentrated power and profit motive that does not serve democracy, a democratic economy or self-rule.  Going back to the gold standard changes absolutely nothing.   The gold standard throughout history has been a source of massive corruption at the expense of society.  It’s a method of choking off monetary and economic growth so that will simply lock in the profits for the corrupt who have stolen everything from society.   It creates the same economic dynamic as corporate lobbying does by limiting the democratic availability of money.  Gold standard advocates are economic dunces.  Period.

Follow the money.  It’s all a delusion created by the unstable human mind.   And one of the greatest delusions in history is the commodities, peak oil, permanently high commodities pricing, China miracle scam perpetuated by endless fraud on Wall Street.

The Cycle Of Volatility And The Deluded Human Mind…..  Soon delusion will be no more.


  Commodities Index chart.

posted by TimingLogic at 8:28 AM

Wednesday, May 25, 2011

Did The Rapture Really Happen On May 21, 2011?

And because of everyone’s impure thoughts, they all ended up back here in this shithole?  It’s a distinct possibility as shown at the link.

Ok, that’s my last rapture post.  No sense in beating a good thing.   That’ll happen in October. 

posted by TimingLogic at 1:01 PM

Tuesday, May 24, 2011

Is A Corrupt Congress Guilty Of Insider Trading?

These two reports generally support the perspective  that something stinks in Washington.   And there have been blatant reports of this type of behavior in the past. 

There is no irony that it runs from the Reagan administration all the way through today.   The Reagan administration started the policy of selling out government on a grand scale. 

posted by TimingLogic at 6:53 PM

Doomsday Kook Now Says October Is The End Of The World

This is why after thousands and thousands of years of  ridiculousness the reasoned mind has accepted that a society should be built on institutions based on reason and the search for truth and not the whims of man.   Or as James Madison said, we have a government of laws and not of men.  And that means government institutions should be both apolitical and areligious.  Our institutions should be above the reach of the beliefs or ideology of any man.   Unfortunately, politicians never seem to understand this as they whore our institutions out for personal power and gain. 

How does one ever reason with the literally unlimited interpretations of religious ideology or the unlimited political beliefs of any man?  A government or society ruled by man is open to endless manipulation by ego and control rather than the search for truth, justice or reason.  Need anyone cite the endless corruption and manipulation of society by the churches and religious bureaucracy in Europe since modern civilization took root?  Or witch hunts and burning people at the stake because of religious terrorism?  Or the endless ridiculousness of hate-spewing mullahs in the Middle East?

Spirituality is a journey that comes from within.  One may rely on the guidance of brilliant spiritual minds over thousands of years as guidance, but to become spiritual is to learn to connect to our own divinity; something that exists in all humanity.   To listen to our higher self that subsumes our physical desires for that of connectedness, acceptance, harmony, selflessness and  community of all people.  Of all living things.   Then one realizes anyone who threatens any of this is the true evil in our world.  That would go well beyond this kook to the war machine, the fascist state, the Chinese communists and frankly just about any manmade bureaucracy of any size and scope that would attract unstable power-mad elements to its ranks.  Which, quite frankly, is why our society is failing.  Government does not work without complete transparency.  It is no longer self-rule.   The rule of law has been hijacked by the rule of man.  And in the case of an end of the world fanatic like this, there is no rule of law to protect anyone from his ridiculousness.  

When one outsources their beliefs to that of another human being, be that religious or political, it is most assuredly going to be manipulated by the unconscious or even conscious desires of the physical manifestation of man.    Spirituality is an ultimate expression of human beauty.  But any time man inserts himself as an authority into any equation, deceit and delusion will almost always the result as some power mad or deluded mind gains control over his fellow man.

This man bilked tens of millions of dollars out of people by terrorizing them into a state of fear.  Many, even a state of panic.  And because he is a religious leader, is he shielded from prosecution or consequences?  In our society, it is illegal to yell fire in a crowded theater.  Is this really any different?  Should people be able to scam others out of their life savings and work them into a panicked state while hiding behind religion in order to deflect from the consequences of their ridiculousness? 

Link here.

posted by TimingLogic at 6:47 PM

Richmond Fed Manufacturing Survey Implodes

posted by TimingLogic at 11:00 AM

Monday, May 23, 2011

A Strong Dollar Isn’t Always A Good Thing? WTF?

I have been critical of former White House economic advisor, Christina Romer, before.  Frankly, I believe people who think like she does have been and continue to lead our society into the ditch.  The proof is self-evident.   

This article is so wrong and so short on facts on so many levels.   It’s basically nothing other than eloquently- written babble.  The mainstream media is the talking head for the status quo.  This is an editorial that is not based on reason or fact. 

Romer’s very limited grasp of the dollar shows a clear lack of understanding of the speculative world we live in.  We have remarked about the endless speculation in foreign exchange markets and that turnover in these markets in a single day is often almost as much as global trade in an entire year.  Some people would argue much of this is hedging by corporations.  I would argue that speculation creates an artificial demand for hedging.  Exhibits of this include Enron, Goldman Sachs, Merrill Lynch, JP Morgan and other Wall Street firms. 

Romer is very short on facts on every account she cites including this ridiculous paragraph. 

“Suppose American entrepreneurs create many products that foreigners want to buy, and start many companies they want to invest in. That will increase the demand for dollars and so cause the dollar’s price to rise. Such innovation will also make Americans want to buy more goods and assets in the United States — and fewer abroad. The supply of dollars to the foreign exchange market will fall, further strengthening the dollar. This example describes very well the conditions of the late 1990s — when the dollar was indeed strong.”

This is so far from reality it’s pure delusion.  The dollar was strong in the late 1990s for two primary reasons.  And the first fueled the second.  And by the way, you won’t read this in the mainstream media or in any economics book because both are sources of ridiculous ivory tower theories of baloney rather than what is happening in the real world. 

In the mid 1990s the Japanese financial system was again teetering on the brink after the initial collapse of its stock market and economic bubble.  The U.S. Federal Reserve worked in concert with the Bank of Japan to engineer a method of recapitalizing Japanese banks by investing in a carry trade.  That is, Japanese banks could borrow at zero percent from the bank of Japan and invest in dollars that were paying 6%(ish).    That fueled a massive surge in the demand for dollars, thus pushing the dollar higher for no fundamental economic reason and allowed Japanese banks to recapitalize themselves.  That in turn helped recapitalize America’s financial system which was still reeling from the massive fraud of the late 1980’s financial collapse in the U.S.   This in turn led to a massive speculative binge by financial institutions in the U.S. that we now call the bubble.   That’s when politicians and society started viewing Wall Street as a source of brilliance and of new career opportunities.  In reality it was simply nothing more than massive unregulated fraud.  Wall Street printed massive profits while bringing companies public that didn’t even have a business plan let alone any income stream.  But, hey, they made billions on the fees of selling this bullshit to your pensions and retirement accounts.  Bullshit that eventually collapsed.   And when the stock market boom turned into a full mania, unregulated global capital poured into the speculative U.S. financial markets, thus driving demand for dollars even higher and the value of the dollar along with it.   Here is the real reason the dollar was strong in the late 1990s; the dollar was going up under Clinton because of massive and systemic fraud. 

There was no economic boom in the late 1990s as Romer remarks.  That is complete and utter bullshit.  And unlike theory and opinion, the facts clearly support this reality.   We have remarked on here numerous times that the U.S. economy was collapsing under Clinton.   That the U.S. almost balanced its budget under Clinton was because of massive tax receipts that were a result of fraud and speculation not capital formation.    If the U.S. economy was booming under Clinton, why was oil at $10 a barrel and gold at $250 an ounce in 1998?  Both points we have highlighted on here that the 1990s were signaling a coming collapse of the U.S. economy.  I’ll tell you why.  Because there was zero economic demand for oil and gold was at $250 an ounce because the real economy was collapsing.  The Federal Reserve did not cause our economic collapse.  Washington politicians did.  The Federal Reserve is just the enabler that allowed fraud and corruption to go unnoticed by printing more and more money to cover it up; something else that is a very contrarian view we have remarked of on here many times.

It’s more neoliberal bullshit to remark that a strong dollar is not always preferable.  This is more of this neoliberal race to the bottom of the barrel.   Every country wishes to weaken its currency for comparative advantage.   People who believe in this bullshit; something that has never, ever, ever worked in the history of human kind, are complete idiots.  If a weak dollar is preferable, then why is not a dollar worth almost nothing even more preferable?  Why not just make the dollar completely worthless and peg it at zero?  Who decides what a dollar is worth?  Romer?  Geithner?  Bernanke?  Ridiculous. 

In the real world, where most of us live, a strong dollar is always preferable.   Always.  Because a strong dollar means as an American, I have purchasing power to feed and clothe my family, put shelter over my head and send my kids to school.  And when it isn’t strong, it’s usually because of fraud.   And that is exactly why the dollar has been going down for the last ten years. 

You can run but you can’t hide from the truth.  And as this fraud we call globalization collapses, at some point the dollar is going to push higher as we have remarked repeatedly.   As we said it would in the 2008 collapse, and as it surely did.  Like a rocket.  And it could do so very violently in the future as well thus dashing the scheme for neoliberals that the dollar should go lower to gain comparative advantage in the scam called globalization.  

We need to quit listening to the status quo as it pertains to finance and the economy.  They are completely clueless.  And we know that because there are 45 million Americans on food stamps and countless tens of millions of additional Americans scraping the bottom of the economic barrel.

posted by TimingLogic at 11:05 AM

Friday, May 20, 2011

May 21, 2011

For those of you who don’t already know, tomorrow is the end of the world.   Obviously, I won’t be posting any more today as I prepare.  I’m making brownies in anticipation of meeting the Big Man.   I’m spiking them with a little weed because I suspect he’s got a substantial sense of humor.  Hey, he did create politicians and banksters.  Or maybe he attributes their creation to Satan.  Seems plausible to me.   

Before I sign off of here today, I thought we could all celebrate with a short video by the favorite group of religious terrorists, AC/DC.

Of course, this guy also predicted the end of the world back in 1994.   I believe this guy is 89 years old so he may not be too far off that the end of the world is near for him.  Not surprisingly, he seems well funded – I was out eating pizza with a friend a few weeks ago and we saw five of his motor homes and a legion of volunteers anxious to help us.  

Terrorism isn’t just a favored game of the state.  It is an art perfected by every bureaucracy.   That’s a pretty good reason to be suspicious of the intentions of any organization led by man that doesn’t have complete transparency into all of their activities.   I thought we used to have a rule of law that embraced these ideals but I guess when Satan gained the upper hand, those didn’t seem to matter anymore. 

In any event, good luck to all of you.  Because if you are reading this blog, you are most certainly headed to hell. 

posted by TimingLogic at 2:58 PM

The Big Lie (Economic Recovery) Continues – Commercial Real Estate Delinquencies Top 10% For The First Time

posted by TimingLogic at 1:50 PM

Euro Cracks Against The Dollar As Norway Suspends Payments To Greece

The Euro is taking a dumpster dive against the dollar today.  I haven’t really commented on the euro area mess recently…  well, because nothing has really changed.  It’s still a mess as we said it would be.  The daily machinations of political con men are really irrelevant.  The fate of this crisis was sealed long ago on some level. 

We were the first blogging source in the U.S. I am aware of to write of the coming crisis, if not demise of the euro.   Believe me, it’s no great accomplishment.  Anyone who understands central banking and monetary economics knew this pig was headed for a fall.   Many in Europe knew this was imminent since the European Central Bank’s inception.   The only people who ever bought this ridiculous notion of an European Central Bank were Wall Street (that thrives off of the corruption of our central bank), the mainstream media (that is owned by corporations that thrive off of the corruption of Wall Street) and political bureaucrats (Who are in a state of constant bribery to both entities above).  When I saw my man Marc Faber remark back before the 2008 collapse that the euro was an honest currency and the dollar wasn’t, I almost wet myself from laughing so hard.  Faber let his emotions get in the way of his generally brilliant insight.  

Greece is boxed into a corner and news out of the crisis has been fast and furious for months.  Greek interest rates were 25% the last time I looked some weeks ago.   Each day some bureaucrat in Europe is making a new proclamation with regards to the crisis -  debt restructuring, no debt restructuring, default,  Greece is going to reissue its own currency, austerity in return for IMF assistance, the European Central Bank will no longer take Greek bonds as collateral in any bondholder haircut and on and on and on.   Frankly, it’s all noise.  It is a bunch of self-interested power-hungry boobs attempting to protect their particular  institution of ego.    No one is looking out for the best interests of Greece.

Greece has a simple way out of this.  But it involves leadership that has a primary intent of restoring economic democracy to the people of Greece.  Greece needs another Georgios Papandreou.   Well, and so do we.  Or another Teddy or Franklin Roosevelt or someone similar.  We wrote when this crisis first started that Greek should default and leave the ECB monetary system.  Greece’s massive debt is a result of political corruption just as in the U.S.   Greece can still participate in the euro economic zone as Norway does, but in order for Greece’s economy to recover from the massive political fraud and corruption, of which Germany is wildly complicit as we have highlighted, they need to recover their monetary sovereignty.  

What ultimately happens as an end state in Greece will more than likely determine how the dominos fall in the other European states in the same predicament.   This is more than likely the battle that will determine the war.  Bureaucrats and keepers of the status quo would laugh at the thought that the Euro could be replaced by sovereign currencies again.   But then the status quo always laughs just before the world as they know it changes forever.   How many bureaucrats in Syria, Bahrain, Yemen, Egypt, Tunisia and other failed states saw the massive tidal wave of dissent against corruption in the Middle East?  The entire Middle East has been destabilized as the masses seek a voice in their own lives.   How many bureaucrats saw the complete collapse of Wall Street three years ago?  Why are the crises in Greece or the United States or Ireland or Iceland or Egypt or Bahrain any different?  It’s absolutely no different.  We all fight the tyranny of corruption and the state.  And it’s all tied together.  Corruption in the U.S. and Europe keeps failed states in power in the Middle East.  It serves political power rather than human dignity and morality. 

The cycle of volatility continues.

Title link here.

posted by TimingLogic at 11:33 AM

Thursday, May 19, 2011

Philadelphia Fed Survey Implodes

posted by TimingLogic at 10:21 AM

The New 3-6-3 For Banksters And The Debt Ceiling Ruse. Our Financial And Political System Is Rife With Dummies …. All Day Long

Okay, First off I am backed up with a follow up post I said I would get up a month ago.  That post, for those waiting, will be put up over Memorial Day weekend. 

Let’s stretch our legs with an out of the box post to stimulate our minds as the political idiots and financial clowns make a mockery of our democracy with their histrionics and ignorance over our debt ceiling and the incessant and mindless babble about U.S. debt default. 

This is an example of where linear thinkers, ideologues and monetary neophytes are being exposed for having  no idea what they are talking about.  That includes people like Bill Gross and John Mauldin, two examples of the status quo we have criticized for their limited and often completely inaccurate views of finance.  Primary dealers in US Treasuries are obligated by law to eat Treasuries at auction whether they want to or not.  Mental midgets who believe banks are going to quit buying Treasuries because the U.S. is issuing too many of them, are sadly short on their facts let alone their rudimentary understanding of money. 

Additionally, the Federal Reserve can supplement any shortfalls in purchases or demand for Treasuries all day long.  Let me repeat that.  All day long.  We don’t need to place government spending as debt instruments in the Treasury bond market.  We can print the money.  And we can do it all day long.  One more time.  All day long.  I wrote this back in the fall of 2008 when financial markets are collapsing and we have said countless times since that quantitative easing changes the game.   At least it changes the game for a while.  Either until something major blows up again, until the Congress forces change into Federal Reserve policy or some other exogenous event occurs outside of the scope of Federal Reserve policy or that requires Congressional approval for allowance of Federal Reserve action.   

This doesn’t mean government can print money without limits and not experience consequences.  It doesn’t mean we should grant this authority to a massively corrupt political system without strict controls and political reform.  It doesn’t mean the Federal Reserve itself doesn’t perpetuate massive fraud.  It doesn’t fix the political fraud in Washington that has destroyed our economy.  It doesn’t impact the economic slavery to corporations and elitist con men in our country.  It doesn’t mean financial markets aren’t going to collapse again.  All it means is the rules of the game have changed for monetary policy, at least for now; something we wrote about at the time these policies were put into place.  

If most people actually actually had a modicum of knowledge as to what was going on, they would be able to string together enough facts to see that borrowing money and paying massive interest on our debts that is now forcing austerity into democratic government programs, is one of the greatest cons of all time.  But the system hasn’t been and isn’t transparent so very few Americans understand any of this.  As we have remarked before, the Federal Reserve, by being so aggressive in saving a criminal system, is exposing  how the system works and how ridiculously simple and corrupt it is.  All in due time. 

Since Bill Gross of Pimco sold out of his Treasury positions (or went synthetically-short) squawking of their doom due to excessive government debt, Treasuries have rallied substantially.  ie, Gross has been perfect.  Perfectly wrong.   Just as we said he would be.

How about a question?  What if the U.S. economy was never to grow again and we had invented the perfect automation systems that never failed and no one needed to work to produce any of our national output?   (We are much closer to this dynamic than people realize and we will talk about this and its implications in more detail later this year.)  Does that mean we would have no money and our society would crumble because of it?  Ridiculous. 

How about another question?  The Soviet Union isn’t any great example of anything other than massive fraud, corruption and centralized planning by bureaucratic idiots but it’s still a valid example that can help people think beyond that of equally ridiculous financial idiots who control the microphone in our country.  Who do you think the Soviet Union borrowed money from in comparison to the U.S. government borrowing money from private banksters?   Because it wasn’t part of the global system of private banking corruption, a different monetary system developed.  By the way, just as did many different scientific achievements and theories.  And that something different was that they didn’t borrow their money from anyone in their domestic economy.   

And as incompetent, brutal and corrupt as Soviet central planners were,  as murderous as the thugs were who ruled the country, and as ridiculously incompetent as their banking and monetary system was, it was a nation that had a higher standard of living than all but the handful of successful democracies in the world.  Their people were fed, albeit often gruel, their educational system often produced scientific brilliance, their literacy rate was much higher than our country today, their citizens, albeit slaves to a state of tyranny and fear, had access to some modicum of modern health care and people all had a home with running water and electricity.  The life of most people may have was one of relative misery but that was because of lack of freedoms and systemic bureaucratic incompetence that a fear-based society demands.  (And one we are becoming)  But then, what do you think life is like for 45 million people on food stamps or the other 30 million who probably should qualify for food stamps?  Or for people who must choose death or bankruptcy because they cannot afford health care in the U.S.?   Or the millions being kicked to the curb while bankers commit endless foreclosure fraud?  Or those slaving away in a corporate culture that demands 80 hour work weeks and no quality of life to speak of to enrich a few criminal bureaucrats in the corner offices who decide to enrich themselves through the toils of others by pay that is often 1,000x that of the average worker?   How’s that working out for you?   Economically, the United States is often just as corrupt as the Soviet Union.   And misery here is rapidly on the rise.  

I have made vague remark of this some time ago but we don’t even need money in a democracy.  One could provide an argument that money is an outdated concept.  Frankly, all that we really need is a system that meets the basic human needs as outlined by Maslow’s hierarchy.  Whether one agrees with this is not the point.   It is one of many valid positions.  Rather than working for money, we would work for our share of the output and national income of the country.  And we could create this dynamic in an incentivized-market based economy that rewards initiative just like our system is supposed to do today.  (But doesn’t do a very good job of it.)   

More important than whether money is even needed, there is zero reason for a sovereign nation to ever issue debt to pay for its core recurring domestic and social programs.  The only reason to ever issue government money as debt, and thus tax society, is to sop up excess liquidity or sterilize spending when the monetary measurements are showing signs of excessive economic activity in a booming private sector or too much government spending or both.  (A vibrant private sector would relieve the need for much, if not most, government services except in times of temporary duress.)  Or to issue debt for major one-time spending events that could cause aberrant monetary phenomenon such as wars or possibly for discretionary monetary-intensive initiatives like a massive infrastructure upgrade or even something like sending astronauts to Mars.   The need for debt issuance could and should expand and contract as demanded by society and its demands for money; thus allowing greater control over full employment and economic opportunity.   Effectively, on some level, this is what the Federal Reserve is doing today.  Albeit, the system is massively corrupt so its effects are limited to perpetuating corruption rather than economic recovery.  Additionally, the system today artificially limits employment opportunity by limiting money available in the economy as we have remarked before.    Right now does anyone see excessive inflation happening anywhere?   Bueller?  Bueller?  Anyone?  Hardly.  And, if you think you see it, then you don’t know what you are talking about.  What you see is rising prices created through corruption.  The same reason housing prices were blowing higher before they collapsed.  You see commodity prices rising because of corruption, manipulation and fraud by financial institutions both inside and outside of the U.S. enabled by deregulation of capital.

We have a system the way it is because we are being duped by corrupt elements seeking to control society.  And, by the way, why are these examples any different than supplementing the needs of Social Security or Medicare via the creation of debt-free government money?   They aren’t.   You can apply this construct in one form or another within properly set boundaries and rules all day long to Social Security or Medicare as well; be that something like credits for food, shelter or health care or outright money creation.  All day long. 

None of the ideologues in our financial system and very, very, very, very few economists seem to grasp anything beyond the end of their nose.  They think with their eyes rather than actually understanding monetary economics 101.   And none of them seem to have any concept of democracy and economics.  We don’t live in a capitalism.  We live in a democracy.

The thought of the U.S. going bankrupt or defaulting is ridiculous.  As I said before, it would be a conscious act of aggression or belligerence against specific bondholders to do so.   And it is pure manipulation and a form of political terrorism to intimate it is possible as Timmy Geithner has recently done.  So, I wouldn’t put it past the Washington con men to default on Chinese debt at some point when the nations are at each other’s throats as they most likely will be at some point.   We have seen this type of belligerence in the past.  We saw it during the Great Depression.  Not in the U.S. but elsewhere.  We simply revalued our currency and could easily do the same thing again by swallowing a massive sum of our debt, which is effectively what we did eighty years ago.  And as we have written numerous times, I believe it is quite plausible we will eventually do so, thus exposing our debt-based system as an illusionary fraud that is needlessly enslaving our society and needlessly cutting social services to our democracy because the status quo is morally corrupt on every level.

As we have remarked before, those who think China holds sway over the U.S. because it owns a trillion dollars of our debt are ridiculous.   And there are a lot of ridiculous people out there.  They play the role of the useful idiots in today’s debate over the future of our country and our economy.  They hijack and deflect from the true debates that we should be having in our democracy.  That is, restoring our economic freedoms, our democratic freedoms and the rule of law that places the sovereignty of this country back into the hands of We The People and out of the hands of political idiots, fascist corporations and criminal banksters.

We’ll talk more of these dynamics in coming months when we take more pot shots at the gold money morons who wish to take us back to an equally corrupt monetary system. 

We need a new economic model and a public banking system.  Yes, one that uses debt or credits for private and some public investment.   And to first do that, we need to get rid of the dead wood and mindless bureaucrats keeping us from achieving our destiny as a free nation of free economic opportunity for all people. 

All day long. 

posted by TimingLogic at 9:23 AM

Wednesday, May 18, 2011

The Obama Deception– No Sense Of Decency Or Loyalty

There is no doubt that the Barack Obama who campaigned as President was a manufactured and manipulated image meant for populist consumption.  The best candidate money could buy. 

We have compared the real President Obama to the appeasers of evil, Neville Chamberlain and Herbert Hoover.   Appeasement in the face of evil is complicity and represents the true moral coward that Chris Hedges has talked about before.  And we have been writing since early on in his presidency that President Obama will likely be a one term president because he has turned a blind eye to massive fraud and corruption that is destroying our economy and democracy.  That’s a far cry from the position held by the Democratic party that appears emboldened about 2012 presidential prospects given the ridiculous candidates put forth by Republicans. 

To see how rapidly political fortunes can change, all we need do is look back on 2008.   Economic events in one month changed the elections and sunk McCain who embraced the ideals of neoliberal idiots and remarked repeatedly that the economy was just fine until the system he supported crumbled before his very eyes.  One month.  Totally unforeseen by the status quo and those who think with their eyes.   It likely cost McCain the Presidential election.  Or look at Iceland where one month forced the wholesale resignation of an entire government beholden to incompetence and fraud.  Linear thinking does not serve anyone well in this environment of volatility.  

While we all suffer from the human condition and no one is clearly worthy of hero worship, Cornel West is a comparative moral giant who has unwaivering fundamental beliefs of equality, compassion, democracy and justice in lieu of the  immoral and amoral political idiots in Washington who generally stand for nothing other than empty lies to get elected at any cost.  Empty lies to fulfill their often sociopathic ego-driven desire for control and validation to help fill the void in their broken and bankrupt soul. 

To hear West’s personal experiences with Barack Obama helps rationalize what many people already know.  That is, the manufactured image of presidential candidate is far different than the real person who West slams as manipulative and complicit in massive government fraud.  I don’t know a single person who voted for Obama that will vote for him again in 2012. 

Our long time position that a third party candidate could emerge in 2012 remains right on track courtesy of a president of appeasement.

Article link here.

posted by TimingLogic at 11:54 AM

How Goldman Top Dogs Defrauded Clients And Lied To Congress: The Justice Department Should Bring Criminal Charges

posted by TimingLogic at 9:14 AM

Unlike Goldman Sachs CEO Who Professed To Do God’s Work, JP Morgan CEO Admits To Being Satan

posted by TimingLogic at 9:10 AM

Tuesday, May 17, 2011

The U.S. Warns China Is Closing Up Again

Five years ago when every financial commenteur finally figured out that everyone should be invested in China and people like Peter Schiff and Jim Rogers were yapping about China being such a great investment, we were contrarily remarking that Chinese officials had lost control of monetary policy and a stock market collapse was imminent.  And collapse it did.  It has not recovered.  And there are many reasons to believe that recovery may never take place.  Or may take thirty to fifty years or longer.  That is, if social unrest doesn’t completely implode the system as it is currently devised.   

We have written extensively on the future of China.  And none of it good.   Most of our major writings were before the 2008 collapse, so we are really just waiting on events to unfold. 

Those who finally realized there was a real estate bubble in China over the last few years have missed the scope of the horror in the Chinese economy.  China’s primary dilemma is NOT a real estate bubble as we have remarked countless times.  It is a capital bubble.  And the outcomes of one versus the other are massively different. 

We have cited the ridiculousness of linear projections from idiots anticipating a $50 trillion Chinese GDP in a few decades to the asinine China projections of Goldman Sachs and now the incompetent bankster and economist pinheads at the IMF who are now expecting China’s economy to surpass the U.S. by 2016.  My God, the world is full of incompetent idiots in positions of authority.

We have contrarily said China’s GDP could drop by as much as 50%.  As a comparative, the drop in U.S. GDP during the Great Depression was roughly half of that to give you an indication of the horror that will come to pass in China.  Yes, it will come.  It has been ordained long ago by the incompetence of authority.  And while buffoons like Timmy Geithner expect the yuan to rise, we have written forever that the yuan is headed south by the time this crisis has passed.   You wanna own a currency where GDP is going to drop through the floor and there is already no rule of law to speak of other than the rule of force?   Let me know how that works out for you.  

For new readers, there have been countless dynamics regarding China that we have discussed.  But one that is coming to pass just recently is this;  the political idiots in the U.S. are now claiming that China is closing up again.  Why yes, we wrote that would happen many years ago as the communists attempted to keep control in a deteriorating economic environment.  And yes the economy in China is deteriorating regardless of the growth numbers that are printed in the headlines.  As we wrote quite some time ago, the massive spike upwards in auto sales, real estate and other consumer expenditures tells us that the Chinese economy is actually in the process of collapse as it has been since the 2008 crisis.   Understanding this dynamic and how capital flows through an economy was one of the first posts we put up on the blog six years ago.  And just as we said back then, it will lead to eventual devastation.  And as part of that, that multinationals who have invested heavily in China would be taking it in the shorts.  Big time.   Or as we have written, this cycle could be coined the ‘end of big’.   These firms could possibly even lose their investments completely if the communists feel threatened enough to nationalize private assets.   And as we wrote, the political idiots in the U.S. are effectively arming states that are enemies to our way of life and our democratic ideals by encouraging American firms to transfer our sovereign wealth to places like China.  But just as we wrote long ago, American firms loved the Nazis too.  They were good capitalists just as the Chinese communists are.  That is, until the Nazis too started closing up. 

If this comes to pass, the corporate state will seek to protect its interests.  And that means by force if necessary.  Something we wrote about in our discussions on volatility and the war cycle.

It’s all coming to pass as we expected.  We are simply in slow motion because of the profligacy of political idiots throwing tens and tens of trillions of dollars at a corrupt global economic system in order to save the monstrosity they created.  A monstrosity created out of massive fraud and corruption. 

Title link here.

posted by TimingLogic at 10:22 AM

Monday, May 16, 2011

Empire State Manufacturing Index Quickly Heading In Wrong Direction

posted by TimingLogic at 9:10 AM

How The Elite’s Lobbying Machine Is Stealing Society Blind

I have no idea if this chart is completely accurate, but I suspect it is pretty close.  It’s funny how we hear the corporate fascist bastard politicians yammering that social services are bankrupting our country.  This at a time where they won’t even consider cuts to the fascist corporatist war machine.  Yet people who blame all of this environment on George Bush either don’t understand what is wrong with our economy and our government or they are left wing ideologues with an agenda that does not include the search for complete honesty and truth, just what serves their ideology.

We are told time and again by Republicans, who are not seekers of truth but in fact ideologues supporting the fascist corporatist war machine, that the major problem with our government is social programs.  Yet, they fail to acknowledge the trillions of dollars in corporate handouts that have taken place over the last few decades as Clinton and Bush perfected the art of  cronyism in government.  It is why Clinton, Gore and Cheney have made close to half a billion dollars between the three of them – by whoring out our government and using themselves as prostitutes by leveraging their rolodex of bribe-able Washington contacts to get things done for communist countries, dictatorships, corporations and anyone else who can pay to play.  

And now that a criminal class has created an environment that allows them to thieve from society but leaves government unable to provide services to We The People, a dynamic created completely through legalized thievery, these same criminals are demanding government sell of  many of our publicly owned assets thus perpetuating even greater thievery that will concentrate wealth even further.  Yes, these assets belong to you.  And they are stealing them from you.  Who will buy these assets at fire sale prices?  Why that’s quite simple.  The only people left with any money; the crooks who created this mess in the first place.   It effectively allows bid-rigging of publicly-owned assets to pay for their past crimes that have been foisted onto government’s balance sheets.

All while a completely criminal Wall Street is caught time and again in the greatest atrocities in our country’s history yet somehow seems to come out of all of these crimes against humanity with simple bribes paid to our corrupt politicians to smooth over their great acts of thievery and criminal behavior.  That includes the most recent massive foreclosure frauds perpetuated by Wall Street.  And how do they pay for these bribes?  Why that’s simple.  They do so with your deposited savings or through government bailouts.  They steal from society coming and going.  One of the most truly disgusting acts of criminal behavior in the history of modern man.  

As we have been saying for a few years now, they are coming for your Social Security and anything else they can get away with. 

It’s time for a public banking system that serves We The People and not a system run by self-interested con men who are most willing to fuck over their fellow man to get to the top of the heap of criminal institutions. 

They are robbing you blind. 

posted by TimingLogic at 8:27 AM

Saturday, May 14, 2011

Ron Paul Announces Run For Presidency While NewsOne Asks Some Tough Questions Regarding Possible Racism

I’ve remarked on here before that I appreciate Ron Paul as a seeker of truth for the endless lies and fraud of our political parties.  But we have also remarked that Paul has some very batty views on monetary policy and economics.    Ron Insana, who is probably the only TV financial journalist I respect as knowledgeable and qualified, has actually remarked that Paul doesn’t even understand basic economics and that his involvement in government policy on the topic is therefore dangerous.    I must agree on some level.  But then his grasp of reality is better than most politicians and most definitely better than our last five Presidents. 

Paul is a savior for many just as Obama was.   In other words, people place their faith in a single person to deliver them from the ills of a corrupt and fraudulent government.  So, any desire to ask serious questions on many topics relating to their positions on serious topics or to criticize views that are open to criticism is often met with vitriol and personal attacks by supporters in some attempt to marginalize dissent.   But, let’s be clear, Paul is often on the other end of the same spectrum of  batty views espoused by political idiots.  Ron Paul’s son, a Tea Party Congressman with similar views as his father, has some even more nutty views as we have remarked before in his desire to end the Department of Energy; the agency responsible for regulating our nuclear power plants.  Of course, that completely baseless and thoughtless position was espoused before Japan’s nuclear disaster.  I don't think he has been foolish enough to utter such stupidity since.  Paul has advocated some really fringe positions over the years but has moderated his message since he has run for President; seemingly understanding he could never be taken seriously while espousing those views.  That includes ditching Social Security, Medicare and a slew of social services.  And deregulating much of our economy which is simply more neoliberalism that has gotten us into this mess in the first place.  That said, Paul gets one thing consistently right.  That is, in a democracy the people are sovereign and political idiots need to be reminded of their positions as public servants and not our masters.

Paul was able to skirt the questions about overt and very disturbing commentary about race baiting and perpetuating racial fear in his newsletter in the last election.  No media pushed him hard for a serious and clear answer to disturbing editorials because he was never a serious candidate. Although the media never really asked any serious questions of anyone.  But Paul could become a serious candidate in 2012. 

Ignorance is not a permanent state of mind for anyone.   People can and do obviously change.   But Paul gave what may be misleading and even false statements about very disturbing remarks in his newsletter in the last election when he said he just couldn’t remember who wrote the disturbing content in his newsletter.   Amnesia is a rather ridiculous and unbelievable position that is a perfected art of all politicians.  We The People deserve straight answers if Paul is going to be a leading Presidential candidate in 2012, and I would hope he is, if for no other reason than he will help set the issues agenda that will force the fascist two party system to answer to its massive fraud and endless lies to the American people.   

Our society affords one the right to be stupid and ignorant.   But a functioning democracy can only function for everyone when its policies are based on truth, reason, logic and equality of basic human dignities and constitutional & economic rights.  Views based on ignorance and stupidity have no place in our society’s leadership.   We already have enough of that.  Given the ridiculous options of Dummycrats and Republikaaners for President in 2012, (And I expect the candidate list to change drastically before the elections) Paul may be the best candidate to expose the massive corruption in Washington.  Fix the economy or government?  Well, not so much.  His views, if unchecked, could dive both into chaos.   But, we must solve our fundamental problem first and Paul will moderate any views as President.  Washington is a fascist cesspool of corruption that has destroyed any concept of democracy in our economy and the concept of self rule and nothing can be fixed until this is addressed. 

Ron Paul could be a primary force for disinfecting the stench in Washington.  But, he needs to give us better answers on some very disturbing commentary  published under his name. 

NewsOne link here.

posted by TimingLogic at 6:50 PM

Friday, May 13, 2011

Blatant Conflict Of Interest? Washington FCC Regulator Who Voted For The Comcast-NBC Merger A Few Months Ago Quits To Become Lobbyist For Comcast NBC

posted by TimingLogic at 12:58 PM

Monday, May 09, 2011

Ford's Turnaround - A Road Map For American Economic Recovery

We have written extensively on here about the auto industry including many of its own self-inflicted problems. Just not much in the last few years. We wrote that bankruptcy was likely coming for the automakers, and specifically the mess that was Chrysler, but we also said we were bullish on the long term prospects of American auto manufacturers before their implosion and restructering.  With all three American auto makers now firmly back in the black, our calls of their demise and eventual rebirth were timely.

When dynamics at Ford were dark and desperate, we wrote a lengthy post as a follow up to our manufacturing and lean methods posts that I was very bullish on Ford. I even laid out the past parallels to Caterpillar when it was left for dead yet arose as a phoenix from the ashes to surprise everyone. I still remember a snide remark re that post from someone who commented that Ford would never be able to compete against Toyota. How the world has changed. Actually Ford has surpassed Toyota in many quality metrics. The impossible has become the probable as we have noted numerous times.  Regardless, Ford is a dominant force again in the auto industry - it has just reported its best profits in thirteen years, is writing down its debt at a relatively fast clip, is delivering great products to the market place for the first time in decades and has outsold GM in North America for the first time in ages.

More importantly, as we highlighted during some of those prior posts, we wrote what Alan Mulally needed to do to turn the company around. That is, transform the bureaucracy where financial idiots used to dictate how a manufacturing, research and design firm was run. And as part of that, to unleash and empower the massive store of incredibly brilliant human capital within the company. And that is exactly what Mulally did.  It was not Mulally that turned around Ford but unlocking its human capital that led to its turn around.  No one person is able to turn around a company or a country and Mulally clearly understands this.

"A leader is best when people barely know he exits. When his work is done, his aim fulfilled, they will say, 'We did it ourselves.'." - Lao Tzu (President Obama and Washington's leaderless culture of political morons could learn more than a few great lessons on leadership from Lao Tzu)

Comparatively, in Japan a finance executive could never run an auto company. Never. That would be like asking a banker to perform open heart surgery.  Or to walk and chew gum.  Yet, most every major industrial company in the U.S. has been hollowed out or destroyed by financial idiots.  GE's CEO, one of President Obama's chief economic advisors has continued the path of financialization of GE that would have taken the company under without taxpayer bailouts for it's CEO's incredible imcompetence.

As Wall Street has gained more and more control over our economy and our politicians, they have demanded financial idiots from Wall Street play a greater and greater role in senior corporate management of corporate America, thus providing a conduit for their own buffoons to land in top corporate jobs.  This has led to a flood of incompetent Wall Street thugs now in senior positions across every industry of our economy.  Senior positions they are completely unqualified to do.  As leaders in industrial powerhouses like Japan and Germany realize, you can't ask someone to do a job they aren't qualified to do  Well, you can.  But look what you get - 50 million lost jobs.  Yes, we have created tens of millions of new jobs as political idiots and Wall Street mobsters like to cite - jobs doing each other's laundry and pushing around financial papers; both of which consume society's wealth rather than create any wealth.  And let's be frank. The educational system in the United States prepares finance students to be qualified to do just about absolutely nothing productive.  (The world would be better off without finance as a university curriculum.  And just as we said would happen years ago, the market is taking care of that one too.  The demand for finance degrees was/is imploding as I type this and it would be very negative without tens of trillions of dollars of government bailouts of financial criminals.)

It's no coincidence scientists dominate the executive management at Japanese auto manufacturers. And as a result of that, it's no coincidence that Japanese auto manufacturers rule the world. In fact, after Toyota's most recent crises a former executive for the company remarked that financial idiots within Toyota were responsible for the crises at the firm. I suspect all of those remarks were directed towards Toyota's American management team which is comprised of a wealth of finance executives.   We also wrote that we were bearish on Toyota's stock before the collapse when every Wall Street carnival barker was bullish on the company and proceeded to watch the company's stock implode.  In the CEO's public rebuke due to shame and dishonor brought upon the company by failed financialization of the company, Toyota learned its lesson by allowing financial management to gain well too much authority within an industrial company.  Fool me once, shame on you.  Fool me twice, shame on me.  Fool me forever and you have the American economy.

For those who seek to use linearity or the rear view mirror to determine the future, let this be an example of the ridiculousness of your notions. Within a few years from the most miserable period in its history, saddled with seemingly insurmountable debt, and without a government bailout, Ford has become what may be the best managed car company in the world. It has definitely reached the upper echelon after decades of mismanagement. And it did so in just a few short years. And similarly, with the right economic model, so too would America's economy become the envy of the world again within a few short years.  Guaranteed.  Proven mathematically.

We don't need to have a debt implosion. We don't need to have a depression. We don't need to increase our savings rate. We don't need to suffer through ten or twenty years of underemployment. We don't need to see the dollar devalue to increase our competitiveness.  We don't need to let the market collapse as many radical theories put forth by financial commenteur's twisted views on Austrian economics and theories of free market dunces. We don't need to cut Social Security. We don't need to inflate our way out of this crisis. We don't need to see housing recover for the economy to recover.  We don't need to bust collective bargaining.  We don't need to destroy social services provided by government.  And most importantly, we don't need to listen to Wall Street idiots and their political stooges. But first we need to get political idiots, economists and financial crooks out of our economic policy decision making.  Unfortunately, just the opposite seems to be happening with the failed Congress and President Obama, both of whom cater to failed Wall Street ridiculousness.

New ideas. New ways of thinking. A return to what made America great. All of these will cure the American economy in a near snap of the fingers just as Ford has done in curing its thirty years of piss poor management.  Just as we wrote years before it actually happened and when no one was willing to entertain any such notion of Ford's return to dominance.

In closing, you might think about how the management initiative we said years ago needed to take place to transform Ford might be a cure to what ails the American economy as it was a cure for Ford. And what economic, banking and political changes would be necessary to accomplish this.

Now that said, I am once again bearish on Ford for a multitude of reasons.  Most of which are a result of its exposure outside of the United States.  From our countless posts on expected global outcomes, I think you can figure those out quite easily.   Yet none of this takes away from the swift and massive turnaround to North American operations.  And just as swiftly, so too could the U.S. economy become the economic engine of the world.
posted by TimingLogic at 10:53 AM

Friday, May 06, 2011

Wall Street Analyst Calls For $3 Trillion Market Capitalization Of Apple

Yahoo Finance is on a roll.   They’ve got some real critical thinkers over there writing Pulitzer Prize-winning journalism.  Now they have some financial savant I have never heard of calling for Apple to ultimately reach $3 trillion market capitalization.

The financial industry is notorious for making calls like this.  In 2000 there were countless calls including Cosmo Kramer’s notorious call that Sun Microsystems was the single best idea of many great ideas he had.   That was before all of his ideas imploded and Sun dropped literally 99% and would have more than likely gone out of business were Oracle not to purchase the company for its software assets. 

The entire U.S. private sector GDP is only about $10 trillion.  Apple with a capitalization of $3 trillion?   Even $1 trillion?  Do these people recognize the ridiculousness of their linear thinking?  People get paid for this?  Honestly? 

Yes, Apple is a well-run company.  Yes, they are a premium brand.   Not even considering fundamentals, which are stacked against Apple, even the best premium brands are generally only able to sustain 15% returns on equity and half that on assets.   Apple’s numbers are currently 40% return on assets.   No technology/consumer company has ever been able to sustain that number over a longer term.  Ever.  Never.  No company.

Sure Apple has a big wad of cash.  Ain’t no trillion dollars.   And anyway, who cares?  What are they going to do with it?  Buy a company and end up with a decade of underperformance caused by integration woes?  Expand the company into new businesses to dilute the brand like Harley-Davidson did before it imploded?  Expand production to not only service people on planet earth but also an every planet served by Star Trek and Star Wars?  Or are they going to give it to shareholders as Microsoft did and watch the stock price implode? 

Today, Apple pays no dividend.  A $3 trillion market capitalization would mean that you are paying 175 years of earnings to own this stock.   A stock with completely unsustainable business and fundamental dynamics at its back right now.   Good luck with that. 

Do you have some idea why our economy is collapsing?  The babble out of financial clowns is endless.   We need a public banking system that serves human development rather than the deluded fantasies of financial clowns.

posted by TimingLogic at 11:31 AM

Thursday, May 05, 2011

A Failed Presidency, A Failed Congress, A Failed Economic Ideology And A Failed Morality - Jobless Claims Spike Again

So much for the recovery.  The only recovery we have is in fraud and tens of trillions of dollars in criminal bank mobster bailouts.  

We have been hovering at 425,000 to 475,000 weekly unemployment claims since Obama and Timmy called the bottom on the recession.  (This ain’t no recession.)   180,000 new jobs created at McDonald’s last month.  I guess our President wasn’t required to take remedial math to become a Harvard lawyer and eventual stooge for the fascist state.  After expenses of getting to your job, including Wall Street’s criminal manipulation of gasoline and your food for your lunch break, also manipulated by Wall Street criminals, that McDonald’s take home pay is probably around $20 for the day.   $20 for two more meals that day, rent, heat, water, car payments, clothes, health care and all of the above for your kids.  

There are more unemployed today than when Obama took office.  But the President and Congressional Republicans and Democrats were busy yucking it up at the correspondent’s dinner a few days ago.  This while tens of millions of Americans were living on food stamps and wondering how they were going to pay for their next meal.   What kind of people are able to do that?  I mean sit around and yuck it up, play golf, go on vacation and whatnot while they are hired as public servants for society and yet so much of society is suffering?  It’s a very disturbing reality.

It’s good to be the king.  Not much longer though. 

posted by TimingLogic at 9:52 AM

Massive Positive Volume Spikes In Equity Markets

Not surprisingly, Wall Street is as bullish as it was in 2008 before the collapse and Barron’s has again succumbed to the idiocy of Wall Street with its cover story of a week ago.    The market has continued to grind higher.on very anemic volume ratios and incredibly weak overall volume as we have remarked.    We have printed day after day of the lowest volume readings of the year in the last two months.  This is to be expected as we have been writing since the 2009 market low that Wall Street would eventually crowd out other economic interests in financial markets through market rigging and manipulation.   And that it is derivatives rather than fundamentals that are driving this rally.  

Let’s look at a monthly graphic below.  The red graph is of monthly positive volume spikes.  The higher the spike, the greater the enthusiasm in markets.  Every single massive positive volume spike (highlighted as in or above the green horizontal band shown cross the entire chart)  has been followed by months of treading water or by eventual declines or both.   Well, except this last one that just occurred……  Or at least not yet. 

Interestingly, if one goes back over the last thirty years or more years, these relatively recent instances of massive positive volume spikes are nonexistent.  Four of the  largest volume spikes in the history of the data set I have occurred at or since the 2008 peak.   Two happened in the middle of the 2008 collapse when it was quite common to hear Wall Streeters, both bull and bear, calling for people to buy stocks on the way down.  And the market rammed those calls right down their throats while we remained bearish until early 2009. 

These massive spikes are recent phenomenon for a reason.  Wall Street has perfected the concept of fraudulent speculation.   As we have remarked, our banking system is able to literally print money out of thin air to buy financial assets.  This dynamic is a recent invention of our corrupt banking system enabled by a corrupt political system.  The supply of money to speculate is only limited by the scale of the frenzy Wall Street is able to build for any particular fraud.  And that means no concept of intrinsic value remains in any financial asset that is the target of speculation.   Every financial asset is a bet whose price is driven by enormous leverage.  Value does not exist and anyone who says it does, is deluded and truly understands nothing of what the greatest value investor of all time, Ben Graham, espoused or what investing truly is about.

This means until the largest financial bubble in the history of the world (literally) pops, there is absolutely no way to determine any go-forward and sustainable price level in any asset that is the target of speculation.  That includes BRIC country assets, emerging markets, corrupt equity markets, global production capacity, gold, silver, bond markets, advertising, quantitative finance, real estate markets, hedge funds, private equity, farm land, food prices, oil, commodity markets, lobbyists, mergers & acquisitions, fraud & corruption, immoral government, the two party political system, financial advisors, healthcare, industrial food production, the war state, the corporate state, economic oligopolies & monopolies and MBAs (The unthinking and immoral[amoral]  Soviet-style bureaucrat needed to perpetuate all of these frauds.).   And we have written of the eventual doom of all of these countless times over the last six years.   These are all massive bubbles created not by fundamental demand or sustainability but enabled by greater and greater leverage of a fraudulent banking system; the antichrist of the 21st century on a level of evil as great as any we have seen in the last one hundred years.

In closing, notice the small green box in the lower right corner of the graph.  The volume spikes off of the 2009 rally low are the most anemic on the fifteen year chart.  This rally has far and away the lowest positive volume in the last fifteen years.  There isn’t anything even comparable.  And if the graphic is expanded, there is nothing comparable throughout history either.  The rally off of the 2009 lows is driven completely by leverage and derivatives.  By Frankenstein finance.  And that is what we would expect.  Fundamental demand for financial assets has imploded as wealth concentrates further and further into the hands of fewer and fewer.  A relative handful of players are propping up all financial assets.  And one player is then propping up these relative handful of players; the immoral Federal Reserve.  As we have said countless times, Wall Street and the investor class are the dumb money.  And they are holding the bag on speculative assets once again.   It’s simply a matter of when exogenous events bring down the house of cards one more time.

If the last fifteen years shown below is any indication, the recent spike (A few months ago) in positive volume, the first monthly spike in a rising market since the 2008 market peak, will soon be leading to a weaker market, consolidation or worse.   (Older data really is not relevant because Wall Street had yet to perfect the printing of money to speculate in financial markets before then.)  With this spike, is the investor class once again “all in”?  This at a time when Wall Street is once again wildly bullish.  Bullish not as determined by sentiment surveys or what they are saying but by what they are doing.


posted by TimingLogic at 9:19 AM

Tuesday, May 03, 2011

John Mauldin Joins Bill Gross In The Long Line Of Clueless Financial Minds

There are countless people in the financial industry that we have called out for their complicity in this mess.  And just as many have been bears as bulls.  As we have cited before, both groups are comprised of people who have supported an ideology as long as it benefited them.  And now they have finally figured out that exponential functions (debt-based money) can’t continue forever.  But even the bears in the financial industry see no way out.  Mauldin is one such person who exposes his views as ridiculous in this interview.   Mauldin is one of the people the great economist Joseph Schumpeter told us we need to get rid of to have a recovery.  They are unable to accept the truth and seek solutions outside of current ideology aka bureaucrats. 

Mauldin makes so many claims that are without merit in this video and story that he clearly exposes massively faulty thinking.  It is this massively faulty thinking by an industry that no one used to listen to, bankers and financial industry personnel, that is keeping us from recovery.  As we have cited before, when society lifts the position of a financial bureaucrat to pre-eminence, doom is just around the corner.  Finance used to be a position that was low on the national income pay scale as it is filled with administrators.   As financial lobbyists corrupted our government, the hot new career became that of the administrator.  

Let me just make a few remarks about Mauldin’s interview and claims.   First of all, he states needed (a completely erroneous claim) austerity will devastate the middle class.   Um, where has Mauldin been for the last thirty years?  The middle class has been getting killed since about 1980.   His remarks are thirty years too late.  He, like Bill Gross, is using rear view mirror analysis to divine the future.   (Linear thinking created by a deluded mind.)  A completely failed strategy.  

We, contrarily are bullish on the future because the fraud of the last thirty years, that Gross and Mauldin supported,  even if it was as useful idiots supporting a system that benefited them but was corrupt and destroyed society,  has been exposed and is completely unsustainable.  Of course, I am bullish only after we get the ship righted.  And that will most certainly devastate the investor class as we have cited repeatedly.   And that will have the effect of pushing people like Mauldin and Gross aside in the national debate.   Society will finally realize that listening to financial administrators for the last thirty years is a failed strategy.  A very good thing.

Mauldin tells us government is crowding out private investment and that if we cut government spending, the private sector will recover.  Well, technically he is accurate.  But he shows a clear misunderstanding of what the problem is.  BUT, if we had a new monetary system that benefited society instead of the privileged few bureaucrats, his statement would be completely without merit.  Mauldin is wrong.  As the system is designed today, if government spending is cut, our system will completely collapse.  The U.S.’s share of private income provided by government has increased 700% over the past thirty-odd years because people like Mauldin bought into a corrupt economic system that forced people on the public dole as they were stripped of their economic rights and self-determination.  Let me pull forward a remark we made a few times on here five or six years ago when Mauldin and other financial clowns were in the ozone with their views on the future and reality.  That is, there is no demand for capital in the United States.  Mauldin clearly doesn’t understand this.  And doesn’t understand without a new economic model, the Federal Reserve is therefore pushing a string up a hill and there will never be a recovery. 

Mauldin cites that raising taxes is necessary to save Social Security.  Another ridiculous statement that shows a complete lack of understanding of money.  We can have Social Security forever with a new economic model and monetary system.  And we will never have to raise taxes to support it.   And never is a very long time.  Never. 

The list of ridiculous assertions by Gross, Mauldin and other bulls and bears in the financial community are endless. There are countless people who can contribute tremendous knowledge to the national debate about how we fix this crisis.   But, you can’t win the national championship in any sport after having the worst season in history and keeping the same players and coaches for the next season.  It’s time for new players and new coaches.    These people have proven their worth in the market they worship.  They are worth nothing to you and me.  They are irrelevant.  And when the investor class implodes, as it started to back in 2008 and will again, their voices will never be heard again.   We will push them aside as failed coaches and players.  They led the United States to the worst economy in our history.  And their views on economics and monetary theory are complete claptrap.  

There are very, very easy answers to this crisis.  But they will be very unpopular with people like Mauldin and Gross because it will relegate them back to the low-paying administrative roles they are qualified to hold. 

Debt did not cause the Great Depression as we have written countless times.  Mauldin, Gross and others harping about our national debt and demanding austerity are doing society a disservice by unwittingly taking the focus off of viable solutions and the real issues that should be debated.   Of course, austerity would benefit both of them by keeping this massively fraudulent system going.   This surely isn’t the case for their ridiculous economic notions.  The case for that is really quite simple.  They just don’t get it.  They are clueless which is the reason why our economy blew up in the first place.

Title link here.

posted by TimingLogic at 12:02 PM