In 223 years, the average real GDP growth for the USA has been 3.8%. At 1.9%, the 2000-2010 decade was the 2nd worst decade for real GDP growth in the storied history of the United States. The worst since 1790 was the 1930s which was followed by what many hope for now, an explosion of growth that occurred in the 1940s. However, three years in, real GDP growth for the 2010-> decade does not look as good as ‘hope’ would like it to be. So what is different this time and what ‘facilitated’ the 1940s recovery? The sad, but very real, truth is… war… but funding that this time will be problem…
The 2nd worst decade of growth for the US ever… and getting worse
But what “saved” us last time looks a little more tricky this time…
Especially given the polarization in DC…
Charts: Hoisington and Citi
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BofAML’s MacNeil Curry is changing his view on gold from bearish to bullish. The impulsive gains from the 1251 low of Oct-15 and break of the two-month downtrend (confirmed on the break of 1330) tells him that a medium-term base and bullish turn is unfolding. BoFAML looks for an ultimate break of the 1433 highs of Aug-28, with potential for a push to 1500/1533 long term resistance. In the next several sessions Curry suggest buying dips into 1309, cautioning that this bullish view is “wrong” if gold breaks below 1251. For those awaiting additional confirmation of a turn, Curry notes you need to see a break of 1375 (Sep-19 high & right shoulder off a multi-month Head and Shoulders Top).
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Flip-flopping from some rational efficient market based economic prognostication to the human nature based entirely non-random cyclical and feedback-loop engaging reality, he explains (sadly reflective of the current clairvoyance of Jim Bullard) that, speaking for himself and his FOMC colleagues, “all of us knew there was a bubble,” though failing to admit to being the progenitor, “but we badly missed the timing.”
Perhaps summing up the mantra of his ilk better than any other sentence, Greenspan concludes, “a bubble in and of itself does not give you a crisis…”adding, during a later Bloomberg TV clip, “I missed certain forecasts, you don’t apologize for that. Do you? I don’t. We are not omniscient. I am a human being.”
Perhaps not, but with every muppet leveraged to the tick on the Russell 2000, we suspect he’ll reject that thesis once again in the future…
Must watch (brief clip) for insight into just how sociopathic our central bankers have become..
Doing the rounds, Greenspan later dropped this little beauty on Bloomberg TV…
“I am in the business where, Harry Truman once said, ‘If you can’t stand the heat, get out of the kitchen’… I apologize for something I did wrong, and I do apologize. I don’t apologize…I was doing the best I can.
The arguments, some of which are quite accurate is I missed certain forecasts, you don’t apologize for that. Do you? I don’t. We are not omniscient. I am a human being. I cannot see beyond the horizon any more than anyone else can.
Now to apologize for not being Superman, I just refuse to do that because that never entered my mind.”
Perhaps some ‘honesty’ like that during your reign would have helped temper the bubbles you created…
via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/gJXrf42ZkM0/story01.htm Tyler Durden
Flip-flopping from some rational efficient market based economic prognostication to the human nature based entirely non-random cyclical and feedback-loop engaging reality, he explains (sadly reflective of the current clairvoyance of Jim Bullard) that, speaking for himself and his FOMC colleagues, “all of us knew there was a bubble,” though failing to admit to being the progenitor, “but we badly missed the timing.”
Perhaps summing up the mantra of his ilk better than any other sentence, Greenspan concludes, “a bubble in and of itself does not give you a crisis…”adding, during a later Bloomberg TV clip, “I missed certain forecasts, you don’t apologize for that. Do you? I don’t. We are not omniscient. I am a human being.”
Perhaps not, but with every muppet leveraged to the tick on the Russell 2000, we suspect he’ll reject that thesis once again in the future…
Must watch (brief clip) for insight into just how sociopathic our central bankers have become..
Doing the rounds, Greenspan later dropped this little beauty on Bloomberg TV…
“I am in the business where, Harry Truman once said, ‘If you can’t stand the heat, get out of the kitchen’… I apologize for something I did wrong, and I do apologize. I don’t apologize…I was doing the best I can.
The arguments, some of which are quite accurate is I missed certain forecasts, you don’t apologize for that. Do you? I don’t. We are not omniscient. I am a human being. I cannot see beyond the horizon any more than anyone else can.
Now to apologize for not being Superman, I just refuse to do that because that never entered my mind.”
Perhaps some ‘honesty’ like that during your reign would have helped temper the bubbles you created…
via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/gJXrf42ZkM0/story01.htm Tyler Durden
In a “Sponsorship Agreement” between the Maryland Health Connection and the Ravens, Judicial Watch reports that the state (read taxpayers) will pay the Super Bowl champs $130,000 to push Obamacare on television, radio, the team’s official website, its newsletter and in social media. If Obamacare is the great thing that we are constantly reassured it to be, why are we seeing the administration feeling the need to constantly market, pitch, and sell the idea by any means possible (from keg standing college students to Superbowl shuffles)?
Of course, they may be on to something with this one…
The professional football team that won this year’s Super Bowl is getting $130,000 from American taxpayers to promote Obamacare, according to documents obtained by Judicial Watch this week.
The deal was secured on September 9 between the Baltimore Ravens of the National Football League (NFL) and Maryland health officials. The White House has tried recruiting professional sports leagues—especially the NFL and the National Basketball Association (NBA)—to help promote the president’s healthcare law but they have declined.
In fact, the NFL confirmed months ago that it would not participate in the Obamacare public relations campaign, offering the media this written statement: “We have responded to the letters we received from members of Congress to inform them we currently have no plans to engage in this area and have had no substantive contact with the administration about [the health-care law’s] implementation.” Washington D.C.’s mainstream newspaper called it a “blow to the administration.”
But Maryland officials evidently appealed directly to the home team, announcing in early September that the Ravens would help market the state’s Obamacare exchange known as Maryland Health Connection. Both parties refused to offer specifics when the deal was initiated and Judicial Watch filed a Maryland Public Information Act request for details.
In a “Sponsorship Agreement” between the Maryland Health Connection and the Ravens, the state will pay the Super Bowl champs $130,000 to push Obamacare on television, radio, the team’s official website, its newsletter and in social media. This includes the Ravens Report Show on cable TV and a number of pre and post-game radio segments as well as Facebook and Twitter plugs.
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In Part I of this multi part series we ask Lance Roberts whether he sees DOW 20,000 or DOW 5,000 ahead, and when?
The economics and fundamentals overwhelmingly suggest the US equity market is now being driven solely by Federal Reserve liquidity injections.
The only way Lance can see DOW 20,000 is to see the market as being in stage 3 of a classic 'blowoff' market cycle:
Phase 1: What Bull Market? Just A Bounce Before The Next Crash.
Phase 2: I Missed The Bottom So I Will Wait For A Pullback.
Phase 3: Market Is Going Up Forever, Just Get On And Ride.
He argues convincingly that Bull Markets don't start from these levels and with these market metrics. His Economic Output Composite Index supports this view.
Listen as Lance kicks-off this discussion with Charles Hugh Smith and Gordon T Long, who share their views as the three go around the table outlining out their respective views (Part II – Charles Hugh Smith and Gordon T Long).
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When economic troubles strike, policymakers are eager to do something (anything) to try to help the citizenry. But, as Prof. Lawrence H. White argues in this brief clip, government doesn’t necessarily know how to relieve economic woes, and in fact, often wastes and mismanages resources. Individuals in the market know better what they need in their circumstances, as economist Friedrich Hayek argued during the Great Depression. Critically, he points out, relying on government to fix our economic woes instead of allowing individuals to make decisions for themselves means putting all of our eggs in one basket. Individual decisions in the market won’t be mistake-free, but each individual mistake will be smaller and will correct more quickly. The unusually slow and painful recovery that we have seen in this recession surely points to problems with the “government should do something” view.
“Who in his right mind would suggest, ‘do nothing’?”… hhmm
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Spoiler alert: Albert Edwards is not exactly bullish. Perhaps like Rosenberg, he too needs to spend a weekend or two on the Ray Dalio ranch.
First on China:
Chinese policy makers are locked in the same old failed credit simulative policies as the west to keep growth going. Indeed, the Chinese GDP ship appears to be steaming ahead in Q3 at a very respectable 7.8% yoy rate. This is the big message the markets have consumed. But look at the ship closely from the front or rear and you can see the ship increasingly rocking violently from side to side while still making forward progress. And are those Chinese policy makers that can be seen manically running from one side in an attempt to keep the ship from foundering? This is a totally unsustainable situation in my view. But again, no-one is listening.
And next, the US:
Only the brave can react to what they see and leave the markets. The global macro looks an appalling mess and even more importantly, long-term equity investors can find nothing worth buying. For equity investors we are closer to 2007 than 2001 as the vast bulk of the equity market, as represented by the median PE, PB or Price/Sales, is expensive. The US median price/sales ratios is at a record high, indicating that there is practically nothing cheap in the equity market left to buy.
Dear Albert: our condolences; the reason no-one is listening is because a comic term we came up with, namely BT(M)FATH, has become a daily investment strategy. And as long as the Fed allows that kind of idiocy to coninue, nobody will listen. Why should they?
In conclusion, here’s J.Paul Getty:
“For as long as I can remember, veteran businessmen and investors – I among them – have been warning about the dangers of irrational stock speculation and hammering away at the theme that stock certificates are deeds of ownership and not betting slips… The professional investor has no choice but to sit by quietly while the mob has its day, until the enthusiasm or panic of the speculators and non-professionals has been spent. He is not impatient, nor is he even in a very great hurry, for he is an investor, not a gambler or a speculator. The seeds of any bust are inherent in any boom that outstrips the pace of whatever solid factors gave it its impetus in the first place. There are no safeguards that can protect the emotional investor from himself.”
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