Archive for November, 2008

Obamanomics: An economic disaster of untold proportions…

November 23, 2008 Leave a comment

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The Moron and his Wall Street crew thought it might be a good idea to inject trillions of dollars into the failing financial system to stimulate new lending, so they handed out billions to every banker they could find – forced them to accept the money, by some reports.

They stuffed hundreds of billions more into the pockets of central bankers from virtually every nation and on almost every continent – Africa, of course, seems to have been bypassed on this astonishing and unprecedented act of charity.

The financial markets responded by immediately shedding trillions of dollars of wealth.

As fast as the U.S Treasury and Federal Reserve could shovel money out the door, investors’ shoveled it right back in. The withdrawal of liquidity from every market proceeded apace as every market player with the means at hand sought the safest form of investment possible: US treasury bonds.

By last week, Hank Paulson threw up his hands and finally surrendered to the obvious: Mr. Market hates money! And, the wealth destruction we are witnessing results not from too little money in circulation, but too much.

Sisyphean efforts notwithstanding, Mr. Market has made clear society is no longer bound by the laws of scarcity and any interventions made on the premise that such scarcity exists will be rebuffed.

Time to wake up, people!

This is not the economy of the Founding Fathers. In about the same time one of that generation of Americans could travel from Boston to England – three months – China will bring 13 new power generating plants online. The productive capacity at our fingertips is of several orders of magnitude greater than that even enjoyed by mid-Twentieth Century Americans.

Now the Messiah has stepped forward to try his hand at the tasks which bedevil his predecessor. Saturday, Barack Obama announced his intention to spend perhaps as much as $600 billion on a stimulus package with a goal of creating 2.5 million new jobs through the start of 2011, according to the Huffington Post:

“These aren’t just steps to pull ourselves out of this immediate crisis; these are the long-term investments in our economic future that have been ignored for far too long,” Obama said in the weekly Democratic radio address. The economic recovery plan being developed by his staff aims to create 2.5 million jobs by January 2011, and he wants to get it through Congress quickly and sign it soon after taking office.

He called the plan “big enough to meet the challenges we face” and said that it will jump-start job creation but also “lay the foundation for a strong and growing economy.

If the Moron and his band of Wall Street predators imagined fixing a financial system choking on bloated bonuses, record profits and years of easy credit with even more trillions of dollars proffered on the easiest of terms, the Messiah and his Clintonite apostles have now decided the fix for an economy predicted to shed millions of jobs and hundreds billion of dollars in government revenue is to “create” more jobs, and run bigger deficits to do it.

Perhaps, we are incredibly dense, but Mr. Market seems to be saying we need less government, less capital, and less work. But, you keep electing people who seem determined to increase all three!

Give us a clue, people: What the fuck are we missing here?

What the fuck is so difficult about having a society where people spend less of their life immersed in the soul destroying filth of labor, greed and, faceless bureaucracy?

What the fuck is so horrifying about devoting less of your time to the mad scramble to pay bills, balance budgets, and find childcare for your own neglected latchkey children, that you would fight so strenuously to increase the very things that makes these things more onerous?

It is clear to us what Donald Trump gets out of this: he couldn’t find a date if he didn’t own a modeling agency.

And, we know what the Moron and Messiah get out of it: Its great to have everyone stand when you walk into a room; its great to glad hand all your class mates who now lead other nations, and know, deep down inside, you won the biggest prize of all – seven fleets prowling the world’s waters, and enough nukes to burnish the surface of the earth with glass, and precipitate a new glacier age.

But just what the fuck do you get out of it?

How is it improving your sex life?

How does it boost your bragging rights at state dinners?

The Messiah has now embarked on culmination of the very disaster begun by his predecessor. Instead of grasping the fundamental logic of this crisis – that working hours must be reduced; and, that government must be reduced along with this – he has chosen to intensify that crisis.

Resolution of this crisis will now likely be imposed in the harshest and most chaotic form possible, with all the incalculably catastrophic unfolding of events that this implies: The default and bankruptcy of the United States government, and subsequent collapse of global economic activity.

By all indications this is the end of the world (market) as we know it…

November 22, 2008 3 comments

When the market closed on Thursday the Standard and Poor 500 index announced to anyone savvy enough to understand that the era of stock markets had drawn to a close.

And, not surprisingly, no one marked that moment.

Certainly the major news outlets covered what was a pretty horrendous day, but there is something left unsaid, something so entirely foreboding, so dire about the closing number – 752 – it is quite the fear whose name must not be spoken: Double Top.

This is the largest such formation ever seen in the history of market.

Just to give you an idea of the scale what just occurred on Thursday: the completion of the S&P double top is akin to the opening of the Seven Seals. defines the double top this way:

The double top is a major reversal pattern that forms after an extended uptrend. As its name implies, the pattern is made up of two consecutive peaks that are roughly equal, with a moderate trough in-between.

An innocuous enough definition, one might not understand how this applies to the closing chart of the S&P 500 on Thursday. So we will show you what it looks like when the chart of the S&P 500 is displayed for the years 1929 to 2008:


Still not impressed?

What you are seeing is the performance of the S&P for the last 80 years. As you will note, somewhere around the mid-1980s the chart start going parabolic – i.e., begins to climb at an unsustainable rate. By the time of the Clinton Administration – about 1995 – the rate of climb became even more unsustainable.

When the market crashed starting in 2000, it fell for 3 years before reaching the bottom.

But, thanks to Washington, and the beginning of the war against Iraq, the market once again rose to the previous 2000 peak by 2007.

This is where the double top finally made its appearance, and, from there, fell to complete itself finally on last Thursday.

Still not so impressive, until you realize a double top is what is known as a major reversal pattern, which is any chart pattern which signals a reversal of the direction of the market.

Since World War II the overall trend of the market has been up.

This pattern says the overall trend will now be down.

We bet you want to know how far down, since all your retirement is invested in the market through personal saving, investments, 401(k)s and 403(b)s, and, state and corporate pension funds.

How far down pretty much determines when, and under what conditions, you may retire in the near or less near future.

Well, to put it bluntly, the chart says don’t bet on any retirement.

It also says: Don’t bet on any mutual funds, banks, or any other financial instruments.

Don’t bet on insurance companies, or, annuities.

Don’t bet on home equity, or, savings.

A double top has clear predictions about what the future holds for the S&P. It may get it wrong this time, but you would be advised not to bet on that either.

Stockcharts has this to say about how bad the current market meltdown will get in all probability:

The distance from support break to peak can be subtracted from the support break for a price target. This would infer that the bigger the formation is, the larger the potential decline.

Support for our chart was in the area of 800. On Thursday, November 20, 2008, the S&P closed below 755 – thus breaking its support and closing at a level not seen since 1997.  The S&P had reached about 1550 at it peak.

Following the method used in the Stockchart quote, we subtract the support, 800, from the peak, 1550, and arrive at the likely target for the S&P in the coming months: 800 minus 750 equals 50.

The last time the S&P was near 50 was about the same time Harry S. Truman was putting his signature to National Security COuncil Memorandum 68.

The S&P chart is essentially saying there has been no real expansion of economic activity since then.It was all smoke and mirrors, as the market will likely demonstrate for us in the coming months.

The S&P chart is essentially saying there will no stock market within a matter of months. It will be gone, and all the capital market connected to it will be gone as well.

Nothing will likely prevent this fall.

We will only be able to avoid the horrendous consequences, but that will require a very aggressive reduction of working hours, and the virtual elimination of government.

20 more reasons to reduce working time now…

November 21, 2008 Leave a comment

73079997MG008_forumOur favorite doomsayer, Nouriel Roubini, has returned with an expanded list of 20 reasons why this will be a longer and deeper recession than common wisdom imagines.

The driving force for this recession, which, he predicts, will be the worst since World War II, and will last through 2009, is, of course, that you are so deep in debt you are incapable of maintain your current standard of living.

While you were looking the other way, Washington has driven you to the brink of impoverishment.

All along, Washington’s strategy has been to hold your income and wages down, while furnishing you with ever greater amounts of easy credit to purchase homes, cars, and other big tickets items – items which, once purchased, created demand for additional complementary goods, like refrigerators and televisions, roads and bridges.

For the most part, this has worked for the last sixty years since President Truman first signed off on National Security Council Memorandum 68. And Washington was richly rewarded with a growing economy out of which it could siphon an ever greater portion of resources to build out its massive empire.

Built on the 1930s depression in the demand for industrial and farm labor, which remains the core of the economy and has never gone away, Washington has been able to erect a massive bubble economy based on easy credit, the proliferation of service (non-goods producing) oriented businesses, government employment, and an ever lengthening work day – a work day growing longer not primarily with the addition of more hours per individual employee, but the addition of more wage earners per household.

(We call this a bubble economy because it consists of pseudo-economic activity which is entirely empty, satisfies no human need whatsoever, puts no food on the table, and adds nothing to your standard of living. An example of this is the confession of a friend who is a classic example of the bubble economy employee: his job is to support the computer systems of a well known financial company. As a practical matter, he often states, “My job is to drag email from the help-desk inbox to one of the folders under the inbox.”)

From your point of view, the ever lengthening work day was the result of inflation and taxation, and the stagnation or fall of real income in the face of rising prices. Over time the income gained by traditional male wage earner required the addition of wages earned by his female counterpart in order to keep up with the pace of inflation.

Families with a single earner – so-called broken homes, run by single mothers – felt the crushing loss created by inflation and became the fodder for the growing mass of families permanently mired in poverty – a permanent underclass of multi-generational losers.

Hence, politicians like Jesse Jackson, and Barack Obama seem that much more astonishing because they managed to escape just this government provoked poverty trap to rise to their present circumstances – thus making it possible to face millions of others not so lucky or resourceful, to tell them, “You too can overcome everything we have thrown in your path designed to make you fail.”

First, turn off that television you purchased on the credit we provided in lieu of a decent wage.

Over the past sixty years, these two measures employed by households to maintain their income in face of Washington’s deliberate policy of economic growth (the official name for government created inflation) – the entrance of millions of mothers into the labor force and the accumulation of household debt – have reached their maximum sustainable levels.

According to Roubini,

The US consumer is shopped out saving less and debt burdened and now faltering…millions of households are insolvent, [slipping] into negative equity territory and on the verge of losing their homes…

There is no solution to this downward spiral, there is only an adjustment to it: the immediate reduction of working hours.

Peter Schiff – Google Video

November 20, 2008 Leave a comment

Peter Schiff surveys the ongoing economic crisis. If you think Washington can inflate its way out of this, you might want to reconsider your assumptions. This is not a crisis of scarcity, requiring artificial economic measures to support demand. This is a crisis brought on by abundance, by the sheer wealth and staggering level of productivity we have achieved as a species.

The only solution for this crisis is a deep and immediate reduction of hours of work.

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The absence of change you will come to believe in…

November 17, 2008 Leave a comment

Just wanted to give you the heads up on a likely ideological bent of the policies you will have to defend as the CHANGE for which you voted not yet two weeks past.

From Willem Buiter – who we instantly came to love when we read his defense of his blog – a spicy survey of the Obama economic team, whom he labels “too old, too uninspiring and too much part of the problem to deliver the change America needs and to keep alive the hope that Obama may have inspired through his election. A wasted opportunity.”

Lies we can believe in…

November 15, 2008 Leave a comment

I was confused there for a moment last spring.

Had this nation actually produced a presidential candidate capable of bringing change to Washington?

Had a corrupt and terribly corrupting social order managed to overcome its own deeply ingrained patterns of anti-human behavior.


Sorry. Merely a momentary lapse into some naive optimism. Evil begets evil, and the son is in the image of the father.

greg-craigBarack Obama’s second appointment announcement is in, and it is a doozy.

One of the most outrageous reversals by the “Messiah” during the campaign was his about face on domestic spying and violations of Americans basic constitutional rights by the Moron’s administration.

The apparent author of that reversal, Attorney Greg Craig, was today appointed to be the Messiah’s White House Counsel.

Said Attorney Craig at the time:

“This was a deliberative process, and not something that was shooting from the hip,” Mr. Craig said. “Obviously, there was an element of what’s possible here. But he concluded that with FISA expiring, that it was better to get a compromise than letting the law expire.”

The only thing wrong with that explanation: it was a lie.

Craig knew it was a lie when he said it.

And, he wasn’t even intelligent enough to come up with another lie to smooth over the first one.

Apparently this man is either a poor liar, or, or someone not used to having to explain his lies.

We will let you be the judge.

So, before you embrace this new religion of CHANGE, you may want to have a look at the man who will be the Messiah’s mouthpiece in some future impeachment proceedings. (Believe me, the Republicans will not be as lenient on him as were the Democrats on his predecessor.)

Here, Mr Greg Craig is being interrogated by Salon on his blatant and obvious lies in response to the Messiah’s sudden betrayal of his supporters on the issue of domestic surveillance:

Back in August, when he was seeking the Democratic nomination, Obama voted against the Protect America Act. Therefore, had Obama had his way, there never would have been any PAA in the first place, and therefore, there never would have been any PAA orders possible. Having voted against the PAA last August, how can Obama now claim that he considers it important that the PAA orders not expire? How can he be eager to avoid the expiration of surveillance orders which he opposed authorizing in the first place?

I asked Craig that question several times and received completely incoherent replies, after which he started insisting that he already answered me and had nothing else to add (he then changed the subject to talk about the “improvements” the current bill achieves over the Rockefeller Senate bill). The fact is that there is no answer. In the past, Obama has opposed the type of warrantless eavesdropping which those PAA orders authorize. He’s repeatedly said that the FISA court works and there’s no need to authorize eavesdropping without individual warrants. None of that can be reconciled with his current claim that he supports this FISA “compromise” because National Security requires that those PAA orders not expire and that there be massive changes to FISA. It’s just as simple as that.

It’s bad enough that Obama is supporting a new warrantless eavesdropping scheme. They should just candidly admit that he changed his position rather than feeding incoherent and insultingly false rationalizations to the public — whereby they throw around the terms “National Security” and “balance” enough times and hope that nobody notices or cares that what they’re saying makes no sense.

“…hope that nobody notices or cares that what they’re saying makes no sense.”

Ah, Hope!

Paul Kedrosky’s Infectious Greed

November 15, 2008 Leave a comment

This has become the hot video of the moment. Peter Schiff explaining, back in 2006, over and over again why we were headed toward a massive crash.Not for the faint of heart.

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The Real News Network – Who is Rahm Emanuel?

November 9, 2008 Leave a comment

Barack Obama is clearly making himself at home in Washington. Soon, all he will need is a bag of pork rinds. We will diligently tick off Barack’s disappointments, lies, half truths, reversals, and, wholesale betrayals as they unfold in the remaining 70-odd days until January 20, 2009.

So, let us begin with his unconscionable, filthy, and unfathomable choice for Chief of Staff:

David Swanson: Rahm Emanuel has been the amazing early bad news following the past two elections.

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I am changing my name to Chrysler…

November 3, 2008 Leave a comment

Presque vu all over again…