The strongest and toughest creatures out there that no one has been able to subdue yet, the inexplicable American consumers, are digging in their heels though the entire power structure has been pushing them relentlessly to buy more and more with money they don’t have, and borrow against future income they might never make, just so that GDP can edge up for another desperate quarter. But it’s been tough.
My twelve-and-a-half minutes of conversation with Max Keiser on the Keiser Report—“Where Money Goes to Die”—aired today on RT. In the first half of the show, Max and Stacy with their tongue-in-cheek, pungent, and edgy manner tear into central banks, bankers, NIRP, the new Apartheid, the Libor scandal…. It’s quite a ride! My part starts in the second half (video).
I’m shocked and appalled that the Libor fiasco could even occur in our modern, highly ethical, and transparent financial sector. Banks misreporting anything…. unheard of. Nevertheless, it occurred. Not just once, but from get-go. And everyone and his dog, even Treasury Secretary Timothy Geithner, back in 2008 when he was still President of the New York Fed, knew about it.
Hilarious explanation of QE and how it works: big industrial-strength printers all facing the windows.
I love wine, but I’m leaning towards Californian wines; they’re awesome and grow in my extended neighborhood. More precisely, I love drinking wine, not keeping it locked up in a refrigerated vault, and certainly not investing in it. Hence, I have little sympathy for those who were buying high-dollar French wines for the purpose of investing in them, instead of drinking them, and I certainly don’t feel sorry for them in their plight. But a plight it is.
“Ugly” doesn’t even describe it. I’m not talking about today’s ISM index of US Manufacturing, which was quite ugly, dropping to the worst level since 2009; and whose all-important New Orders index was beyond ugly. And I’m not talking about today’s Global Manufacturing PMI, which was truly ugly, seeing its lowest level since June 2009. These are volatile indices that might turn around on a dime, though that appears to be wishful thinking.
Certain central bankers are coming out of the closet admitting that their favorite shenanigans—ultralow interest rates and printing money with utter abandon—can’t solve the very problems they were designed to solve, which has been obvious for a long time. What they’re not yet admitting massively, though some are starting to hand out hints, is just how much havoc these policies are wreaking.
Since the lousy jobs report, there has been a veritable orgy of Fed Speak with juicy morsels and contradictions, interspersed with leaks and rumors, that climaxed today with Chairman Ben Bernanke’s words of wisdom. It whipped markets into a frenzy, drove the Dow up 500 points, knocked yields to historic lows, and caused gold, the safe-haven, to bounce up and down like a rubber ball. And everyone was eagerly waiting for the big lie.
The ugly jobs report gave Mitt Romney what he’d been waiting for: a huge boost. He’s out making hay, calling it “devastating news for American workers and families.” An army of Republican talking heads swarmed over the land and pummeled President Obama with the jobs report. And just as Republicans see victory edge closer, shrill voices are calling for the Fed to launch the next round of quantitative easing. Collision alert!
When inflation isn’t particularly hot, it’s praised as something desirable…. Alas: “Lenin is said to have declared that the best way to destroy the capitalist system was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily.” John Maynard Keynes.