Myth of the Day

The economic recovery that the media and talking heads have been bantering around does not exist and is just a myth. A manipulated stock market distorted by recent economic policy hides and mask the real truth, in many ways it is ground zero in the war to convince us all is well. The American people and Main Street will tell you they are far from convinced that it is smooth sailing ahead. Huge weakness in the economy was confirmed recently by Ben Bernanke and the Federal Reserve when they failed to cut back QE by even the slightest amount. Fact is if QE or the massive government deficit spending that props up our economy is removed it will fold like a cheap umbrella.

Recent changes in how the GDP is figured , which boosted growth thus reducing the debt to growth ratio, and attempts to spin poor numbers regarding employment have been met with skepticism. Auto and new home sales have recovered a bit from the levels hit during the crises mainly as a result of QE and massive government deficits coupled with low interest rates that make both mush less expensive to finance, but we are still in an economic morass. Poor job creation and stagnate wages have left millions in a protracted state of financial weakness. We are not in recovery we are dead n the water.

The American government has been running one and a half trillion dollar deficits the last several years. This represents a staggering $4,500 per person and $15,300 per family in America each year, these huge deficits add up very fast! Sadly, this is what is propelling the economy forward, and it is not sustainable. Massively compounding the problem is the realization that many people such as infants, children, the disabled, and the unemployed could not repay their share of this debt if their life depended on it, this transfers the burden to the remainder of society.

Those in power have cast a bum rap upon austerity as they continue to steer us towards what they hope is a controllable inflation ramp. It seems the goal is to move inflation up enough that it is still acceptable but at the same time give people the illusion of economic growth. This would support pension funds and others in the stock markets thus fostering the golden “wealth effect” that encourages people to borrow money and go out and spend. If  these funds fall in value it will bring into question the whole economic system and a collapse that will bring down the pension system.

The head of the International Monetary Fund, Christine Lagarde, has warned that the latest chink in our economic armor, a US default, could tip the world into recession. In a US television interview she said a default would result in “massive disruption the world over”. She went on to say “If there is that degree of disruption, that lack of certainty, that lack of trust in the US signature, it would mean massive disruption the world over and we would be at risk of tipping yet again into recession.” Her message, spend now and after things get better worry about the debt.

President Obama said, “It wouldn’t be wise, as some suggest, to just kick the debt ceiling can down the road for a couple of months, and flirt with a first-ever intentional default right in the middle of the holiday shopping season.”   The political gridlock concerning government spending that has shutdown the US government will shave 0.25% off economic growth each week it continues is the estimate of US Treasury Secretary Jack Lew. Growth is already expected to be sluggish this quarter. The US Treasury has been using what it calls extraordinary measures to keep paying the bills, but those measures hit a wall on October 17.

Every week the Treasury has to refinance 100 billion dollars of debt in the form of US government bonds known as treasuries. The US also has to pay interest on its huge debt burden. An inability to pay that interest, or pay back debt if required, would put the US into default. On Saturday, Jamie Dimon, head of  JP Morgan said the possible repercussions did not bear thinking about. “You don’t want to know (what would happen),” he said. “It would ripple through the world economy in a way that you couldn’t possibly understand.”

Lie Of The Day

Yesterday an expert, who they called the “most bullish man in America” appeared on a financial show and proclaimed that the stock markets will see a huge rise by year end. He said this was due to the lowest interest rates in history. My response, then why has Japan had two lost decades since adopting its zero interest rate policies?

This brought to mind a post that I attached below. I wrote this note of irritation on March 27th it is called,
 
                                                         You Don’t Know That!

Oh to the confident and suave television and news commentators, and the experts that speak with such authority, I include the pundits and so called specialist, to you I  say, I’m skeptical and dubious. Even when you mask your bias and your agenda is hidden, I must often remind myself that, you don’t know that. It is often not the message you put out, but how you project it. I can see you now, your head a bobbing and your arms moving all around, you state your case  with such brilliance and force that often we are swept away!

This rant is in reference to all the pundits and so called experts, about all the words that spew from their mouths, about the reams of material they write, and the large quantity of often misstated facts they put forth. Sometimes these clowns even go as far as to tell us exactly what someone was thinking, for example if  a commentator states, “when the man jumped he knew it was to his death”, I ask, how do they know that? It is possible that the man was an optimist or the light never came on. Fact is that when it comes down to what someone is thinking these authorities are only speculating.

After they have used every line from “green shoots” and “edge of  the envelope” they say, “that being said” and after “having said that” they often  wow me with “just do the math” or “it is not if, it is when”. But what sends me over the top is the line often used by politicians and our so called public servants to justify some unsavory action, “it would of been far worse if we had done nothing”. How do they know that? I beg to differ, but on more then one occasion I wish they had done nothing.

It seems that people love to defer to the opinions and advice of so called experts so they don’t have to think, of course I don’t know that for sure. One thing I do know is that is not based on speculation or hearsay is that it would be a lot easier to tolerate these clowns if they were right at least every now and then.

LANCE ARMSTRONG IS BEING CRUCIFIED

What appears to be a quasi-government agency has put the American hero Lance Armstrong on trial. I suspect I’m not the only taxpayer that is angry at the continuation of our government attacking it’s citizens. Armstrong has been an incredible inspiration, an ambassador for America as well as a leader in bringing the issue of cancer and the fight against it to the forefront. On June 13th former professional cyclist Lance Armstrong was formally charged with doping by the U.S. Anti-Doping Agency, another creation of our Government that has run amuck. With no “due process” and a standard lower then “legal reasonable doubt” the USADA charges and investigation amounts to the crucifixion and destruction of the life and rights of an American citizen using our taxpayer money.

The Wall Street Journal cited a letter in which the agency said blood samples collected in 2009 and 2010 were “fully consistent with blood manipulation including EPO use and/or blood transfusions.” In a statement, Armstrong attacked the “discredited allegations dating back more than 16 years.” The action could cost Armstrong some or all of his seven Tour de France titles, according to the Journal, he’s now banned from competing in triathlons as a result of the charges. The case is no longer just about whether Armstrong used drugs to win the Tour de France, but whether there was a team-wide doping program, an offense that could lead to fraud and conspiracy charges.

Of course two of the accusers, Landis and Hamilton, have credibility issues and have changed their stories. A story by CBS chose to rely on these questionable sources while completely ignored Lance’s nearly 500 clean tests and the hundreds of former teammates and competitors who would have spoken about his work ethic and talent. Armstrong and his lawyers claim Hamilton is leveraging his allegations against Armstrong to try to secure a book deal. Hamilton’s public remarks put him alongside not only Landis but also George Hincapie as the third trusted teammate to have allegedly spoken to federal authorities looking into the Armstrong case. (See the Reuters release below:)

                     ———————————————————————————
(Reuters) – Statement released by Lance Armstrong on Wednesday in response to reports he had been contacted by the United States Anti-Doping Agency over doping allegations

           “I have been notified that USADA, an organization largely funded by taxpayer dollars but governed only by self-written rules, intends to again dredge up discredited allegations dating back more than 16 years to prevent me from competing as a triathlete and try and strip me of the seven Tour de France victories I earned. “These are the very same charges and the same witnesses that the Justice Department chose not to pursue after a two-year investigation. These charges are baseless, motivated by spite and advanced through testimony bought and paid for by promises of anonymity and immunity.
            “Although USADA alleges a wide-ranging conspiracy extended over more than 16 years, I am the only athlete it has chosen to charge. USADA’s malice, its methods, its star-chamber practices, and its decision to punish first and adjudicate later all are at odds with our ideals of fairness and fair play. “I have never doped, and, unlike many of my accusers, I have competed as an endurance athlete for 25 years with no spike in performance, passed more than 500 drug tests and never failed one. “That USADA ignores this fundamental distinction and charges me instead of the admitted dopers says far more about USADA, its lack of fairness and this vendetta than it does about my guilt or innocence.”
                 ———————————————————————————–

I’m dubious and suspicious of any testimony that is sought after with such vigor and where the accuser is given immunity. I must question if the testimony has been coerced or the motivation of the accusers and why these guys continue to try to bring Armstrong down with taxpayer money? What do they feel they have to prove?  Baseball great Roger Clements Roger was recently acquitted on all charges that he obstructed and lied to Congress in denying he used performance-enhancing drugs to extend his pitching career. Like the governments assault on  Martha Stewart this is another example of injustice, she did time and was forced to pay huge fines not for insider trading (something that until recently was legal for politicians in Washington), but for lying. What politician could endure this kind of constant scrutiny?

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