Peddling The Truth?
Again over at Mercenary Traders, The Next Global Financial Crisis, we Natter:
A99,
"I have heard this view several times. Usually the folks peddling it also say that the "real" unemployment rate in the U.S. is 25%, inflation is rampant, QE is holding up stocks / there is no growth etc."
And it doesn't have to be peddled very hard, as that would be a reality based assessment on most all counts. Excepting that to ascertain the real unemployment number, for all those no longer counted in the number because benefits expired, take the 5.3% advertised figure and or put a 1 in front of it, real unemployment est. 15.3%.
To ascertain UNDERemployment, all those people working 4 of our great paying growth McJobs at minimum wage to make ends meet, take the U6 number 12.6, replace the 1 with a 2, real UNDERemployment 22.6.
For real inflation, the advertised rate for All Items YOY NSA CPI-U +0.2%, place a 1 in front, real inflation 10.2%. Amazingly so, its even simpler to verify, use the 1980 CPI calculations found in this chart which render a realistic number averaging double digits since 2000 at 10% per annum.
Real household income has declined since 1985. Inflation is raging for anyone who actually buys food and pays to keep a roof over their head. As for no GDP growth, that might be a bit generous, we are actually experiencing NEGATIVE growth, which is the real "deflation" of media narrative.
As for QE holding up stocks, no growth in values. The serial bubbles that monetary policy has produced, QE being the latest incarnation, have done nothing but create overinflation in all asset classes, suppress interest rates and create malinvestment in financialism, rather than real economic activity.
For stock values, all one need do is see that buybacks and dividends surpassed 100% of earnings at 104.1% last quarter. Dividends and stock buybacks have represented, on average, over the last 18 years, 85% of corporate earnings since 1998. Another example of financialism suppressing capex and animal spirits, or real economic investment and development.
Most of this has been proven six ways to Sunday and there is no debate, other than amongst the ignorant, clueless and those not paying attention. After you have lived through a half dozen of these "crisis", you learn how to spot one way in advance. If you have not lived through at least three, your frame of reference is skewed. Yeah, its always different this time, this time its bigger and going to end much worse than the last. Below is a really big clue as to why we are in this predicament and it may get much worse...
Salmo Trutta: "It is axiomatic (true for over 100 years), given nominal rigidity (limited upward and downward price and wage flexibility), unless monetary flows (our means-of-payment money times its transactions rate-of-turnover), exceed the rate-of-change, roc, in real-output by 2-3 percentage points (at least the roc of "asked prices"), output can't be sold, production will be cut back, incomes will decline, and layoffs will ensue."
A99,
"I have heard this view several times. Usually the folks peddling it also say that the "real" unemployment rate in the U.S. is 25%, inflation is rampant, QE is holding up stocks / there is no growth etc."
And it doesn't have to be peddled very hard, as that would be a reality based assessment on most all counts. Excepting that to ascertain the real unemployment number, for all those no longer counted in the number because benefits expired, take the 5.3% advertised figure and or put a 1 in front of it, real unemployment est. 15.3%.
To ascertain UNDERemployment, all those people working 4 of our great paying growth McJobs at minimum wage to make ends meet, take the U6 number 12.6, replace the 1 with a 2, real UNDERemployment 22.6.
For real inflation, the advertised rate for All Items YOY NSA CPI-U +0.2%, place a 1 in front, real inflation 10.2%. Amazingly so, its even simpler to verify, use the 1980 CPI calculations found in this chart which render a realistic number averaging double digits since 2000 at 10% per annum.
Real household income has declined since 1985. Inflation is raging for anyone who actually buys food and pays to keep a roof over their head. As for no GDP growth, that might be a bit generous, we are actually experiencing NEGATIVE growth, which is the real "deflation" of media narrative.
As for QE holding up stocks, no growth in values. The serial bubbles that monetary policy has produced, QE being the latest incarnation, have done nothing but create overinflation in all asset classes, suppress interest rates and create malinvestment in financialism, rather than real economic activity.
For stock values, all one need do is see that buybacks and dividends surpassed 100% of earnings at 104.1% last quarter. Dividends and stock buybacks have represented, on average, over the last 18 years, 85% of corporate earnings since 1998. Another example of financialism suppressing capex and animal spirits, or real economic investment and development.
Most of this has been proven six ways to Sunday and there is no debate, other than amongst the ignorant, clueless and those not paying attention. After you have lived through a half dozen of these "crisis", you learn how to spot one way in advance. If you have not lived through at least three, your frame of reference is skewed. Yeah, its always different this time, this time its bigger and going to end much worse than the last. Below is a really big clue as to why we are in this predicament and it may get much worse...
Salmo Trutta: "It is axiomatic (true for over 100 years), given nominal rigidity (limited upward and downward price and wage flexibility), unless monetary flows (our means-of-payment money times its transactions rate-of-turnover), exceed the rate-of-change, roc, in real-output by 2-3 percentage points (at least the roc of "asked prices"), output can't be sold, production will be cut back, incomes will decline, and layoffs will ensue."
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