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Jim Cook

 

RUNAWAY SOCIAL SYMPATHY

Every once in a while I switch the TV channel from Fox to CNBC to see what the liberals are saying.  After listening awhile I get a deep sense of hopelessness and foreboding for our country.  The most important thing for the left is giving money to people.  They are happy to see the growth of food stamps, disability payments, housing subsidies, free healthcare and all the other welfare benefits.  They utterly fail to see the damage it is doing to the recipients.  Whole cities that once flourished have deteriorated into rotting eyesores populated with shambling hulks of chemically dependent drones.  These people are no longer employable.  They have become incompetent and helpless and the liberals can’t see that it’s their doing.

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Condensed Articles

March 27, 2013

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NOT DIFFERENT BUT MORE DANGEROUS
By John Aziz

While stock prices are soaring household income and household confidence are slumping to all-time lows.  Employment remains depressed, energy remains expensive, housing remains depressed, wages and salaries as a percentage of GDP keep falling, and the economy remains in a deleveraging cycle.  Essentially, these are not the conditions for strong organic business growth, for a sustainable boom.  We’re going through a structural economic adjustment, and suffering the consequences of a huge 40-year debt-fueled boom.  While the fundamentals remain weak, it can only be expected that equity markets should remain weak.  But that is patently not what has happened.

In fact, it has been engineered that way.  Bernanke has been explicitly targeting equities, hoping to trigger a beneficent spiral that he calls “the wealth effect” – stock prices go up, people feel richer and spend, and the economy recovers.  But with fundamentals still depressed, this boom cannot be sustained.

There are several popular memes doing the rounds to suggest, of course, that this time is different and that the boom times are here to stay, including the utterly hilarious notion that the Dow Jones is now a “safe haven.”  They are all variations on one theme – that Bernanke is supporting the recovery, and will do whatever it takes to continue to support it.  Markets seem to be taking this as a sign that the recovery is real and here to stay.  But this is obviously false, and it is this delusion that is so dangerous.

With every day that the DJIA climbs to new all-time highs, more suckers will be drawn into the market.  But it won’t last.  Insiders have already gone aggressively bearish.  This time isn’t different.