- Why Did Q3 GDP Jump: Thank ISIS And The “War On Terror” (ZeroHedge, Oct 30, 2014):
Never let a crisis, or war on terror, go to waste…
- Why Did Q3 GDP Jump: Thank ISIS And The “War On Terror” (ZeroHedge, Oct 30, 2014):
Never let a crisis, or war on terror, go to waste…
- Kudos To Herr Weidmann For Uttering Three Truths In One Speech (David Stockman’s Contra Corner, Oct 17, 2014):
Once in a blue moon officials commit truth in public, but the intrepid leader of Germany’s central bank has delivered a speech which let’s loose of three of them in a single go. Speaking at a conference in Riga, Latvia, Jens Weidmann put the kibosh on QE, low-flation and central bank interference in pricing of risky assets.
These days the Keynesian chorus in favor of policy activism is so boisterous that a succinct statement to the contrary rarely gets through – especially at Rupert Murdoch’s Wall Street yarn factory. But here’s what penetrated even Brian Blackstone’s filters:
“The biggest bottleneck for growth in the euro area is not monetary policy, nor is it the lack of fiscal stimulus: it is the structural barriers that impede competition, innovation and productivity,” he said.
Reality is still the same, only the GDP figures are different.
- Sex, drugs and…Hookers and dope bring Italy out of recession (RT, Oct 15, 2014):
Illegal economic activities such as drugs and prostitution are apparently responsible for having lifted Italy out of economic recession. EU data calculations have demonstrated that the black market has significantly boosted GDP figures.
Italy is technically no longer in economic recession because of the addition of figures from illegal activities.
- The “Growth Problem” Explained For Idiots And Federal Reserve Dummies (ZeroHedge, Oct 10, 2014):
Over the past six years we have tried, in a countless number of ways, to explain to the “wise” economists, IMFers, World Bankers, Federal Reservers, talking heads and everyone else who would rather not listen, that which is glaringly obvious: the US (and global) economic growth will never recover and rebound and in fact will decline with every passing year for one simple reason – the US (and global) debt bubble is bigger than ever.
In fact, at 300% total debt/GDP it is bigger than the 275% hit during the Great Depression (we doubt we need to remind readers what global event ended that particular time in US history).
So, in hopes there is still some intelligent life left among the decision makers, and in hopes of liquidating the record debt overhang before it is too late and the US has to engage in another deadly, global war, here it is again: Continue reading »
- The Fed’s Laughable GDP “Forecast” Just Got Even Funnier (ZeroHedge, Sep 17, 2014):
What in January 2012 was a 2014 GDP forecast range of 3.7%-4.0% collapsed to 2.1%-2.3% in June (because clearly the Fed couldn’t possibly forecast snow in the winter), and three months later is now 2.0%-2.2%. In short, a 43% forecasting error. Continue reading »
Dr. Paul Craig Roberts was Assistant Secretary of the Treasury during President Reagan’s first term. He was Associate Editor of the Wall Street Journal. He has held numerous academic appointments, including the William E. Simon Chair, Center for Strategic and International Studies, Georgetown University, and Senior Research Fellow, Hoover Institution, Stanford University.
- No Economy For Americans (Paul Craig Roberts, Sep 8, 2014):
Quarterly Request for Donations
As many of you know, a couple of years ago when I tried to retire you wouldn’t hear of it.
I resigned my syndicated column and said goodbye. In thousands of emails you described to me your reliance on my experience and education to help you to understand in a non-partisan way the events of our time. You made a convincing case. I came out of retirement, opened this website, and you have faithfully supported it.
This is your website. It will continue as long as you support it.
No Economy For Americans
Paul Craig Roberts
The Dow Jones stock average closed Friday at 17,137, despite the fact that the payroll jobs report was a measly 125,000 new jobs for August, an insufficient amount to keep up with the growth in the working age population.
The low 125,000 jobs figure is also inconsistent with the Bureau of Economic Analysis’ second estimate of second quarter 2014 US GDP growth of 4.2 percent–a figure beyond the capability of the present-day US economy.
Clearly, the economic numbers are out of sync with one another. They are also out of sync with reality. Continue reading »
- 14 Reasons Why The U.S. Economy’s Bubble Of False Prosperity May Be About To Burst (Economic Collapse, Aug 14, 2014):
Did you know that a major event just happened in the financial markets that we have not seen since the financial crisis of 2008? If you rely on the mainstream media for your news, you probably didn’t even hear about it. Just prior to the last stock market crash, a massive amount of money was pulled out of junk bonds. Now it is happening again. In fact, as you will read about below, the market for high yield bonds just experienced “a 6-sigma event”. But this is not the only indication that the U.S. economy could be on the verge of very hard times. Retail sales are extremely disappointing, mortgage applications are at a 14 year low and growing geopolitical storms around the world have investors spooked. For a long time now, we have been enjoying a period of relative economic stability even though our underlying economic fundamentals continue to get even worse. Unfortunately, there are now a bunch of signs that this period of relative stability is about to end.
The following are 14 reasons why the U.S. economy’s bubble of false prosperity may be about to burst: Continue reading »
- The Baltic Dry Index Collapses To 18-Month Lows; Worst July Since 1986 (ZeroHedge, July 22, 2014):
The bulls will ignore it, shrugging that it’s merely over-supply of ships that the resurgent world economy will quickly soak up as it ‘recovers’… However, World GDP growth expectations are collapsing, trade volumes are slowing, and the Baltic Dry Index has continued to slump to its lowest since the start of January 2013 (a holiday period). For some context, this is the lowest July level for the Baltic Dry since 1986… “noise”
and then there’s this…
Which is the worst July level for the global shipping index since 1986… Continue reading »
- Portugal President Admits Espirito Santo Failure Could Be Systemic As Another HoldCo Goes Bankrup (ZeroHedge, July 22, 2014):
As RioForte joins its parent ESI in bankruptcy, in a strangely honest turn of events from a European leader, Portugal’s President Anibal Cavaco Silva warned on Monday that fallout from the financial troubles of the founding family of Banco Espirito Santo (BES) could affect the wider economy. With Portugal’s hope-strewn GDP growth expectations at only 0.9% for 2014, they do not have much room for disappointment before the nation (whose yields remain near record lows) double- or triple-dips back into recession. Silva concluded, “We cannot ignore that there will be some impact on the real economy,” which is odd given every talking-head has explained it is “contained” and “priced-in.”
Rioforte joins ESI in bankjruptcy…
- *RIOFORTE SAYS IT SEEKS PROTECTION FROM CREDITORS
- *RIOFORTE SAYS FILING IS LINKED TO DIFFICULTIES AT ESI
Just another default in the chain Continue reading »
- World GDP Hopes Are Collapsing (ZeroHedge, July 18, 2014):inShare27
Presented with no comment (except to note how different the “fact” in this chart is from the “fantasy” we hear spewed day after day about ‘recovery’ in the world’s economy)…
- China Prepares To “Boost” Economy By Also Revising Its GDP Definition (ZeroHedge, July 8, 2014):
Now that even that bedrock of the Keynesian voodoo religion, the Gross Domestic Product calculation, has become a ridiculous farce, with everyone in Europe suddenly adding the uncalculable “contribution” from drug dealers and hookers all in a mad dash to make debt/GDP ratios appear better than they are, it is truly time to unleash the clowns as none other than the country which has taken fabricating economic data to an artform, no not the US for those confused but China, is preparing to change the way its calculates its GDP, with the biggest contribution coming from, hold on to your hats, R&D. One wonders if “reverse engineering” of pirated products and services is covered in this “non-GAAP GDP” category. The end result? GDP for the country which cumulatively will be several percentage points higher once the entire fudging/recasting exercise is completed. Continue reading »
- GDP Disaster: Final Q1 GDP Crashes To -2.9%, Lowest Since 2009, Far Below The Worst Expectations (ZeroHedge, June 25, 2014):
Remember when in January 2014, Q1 GDP was expected to rise 2.6%? Well, here comes the final Q1 GDP revision and it’s a doozy: at -2.9%, far below the -1.8% expected and well below the -1.0% second revision, it is an absolute disaster, and is the worst print since Q1 2009.
And while a bad GDP print was largely expected, the driver wasn’t: personal consumption expenditures somehow crashed from 3.1% to just 1.0%, far below the 2.4% expected, meaning that all hope of a consumer recovery is dead. Finally, as a reminder, US GDP has never fallen more than 1.5% except during or just before an NBER-defined recession since quarterly GDP records began in 1947. Good luck department of truth propaganda machine, because even assuming 3% growth every other quarter in 2014 means 2014 GDP will be 1.5% at best!
- 12 Numbers About The Global Financial Ponzi Scheme That Should Be Burned Into Your Brain (Economic Collapse, June 11, 2014):
The numbers that you are about to see are likely to shock you. They prove that the global financial Ponzi scheme is far more extensive than most people would ever dare to imagine. As you will see below, the total amount of debt in the world is now more than three times greater than global GDP. In other words, you could take every single good and service produced on the entire planet this year, next year and the year after that and it still would not be enough to pay off all the debt. But even that number pales in comparison to the exposure that big global banks have to derivatives contracts. It is hard to put into words how reckless they have been. At the low end of the estimates, the total exposure that global banks have to derivatives contracts is 710 trillion dollars. That is an amount of money that is almost unimaginable. And the reality of the matter is that there is really not all that much actual “money” in circulation today. In fact, as you will read about below, there is only a little bit more than a trillion dollars of U.S. currency that you can actually hold in your hands in existence. If we all went out and tried to close our bank accounts and investment portfolios all at once, that would create a major league crisis. The truth is that our financial system is little more than a giant pyramid scheme that is based on debt and paper promises. It is literally a miracle that it has survived for so long without collapsing already. Continue reading »
- “Same Stuff, Different Year” (ZeroHedge, June 4, 2014):
How many more of these annual disappointments does it take before the world gets the joke…
The History of consensus expectations for US GDP…(notice they all go from the upper left to the lower left…)
Source: Bloomberg h/t @M_McDonough
- The Truman Show US Economy: Real GDP Numbers Show -9% Annualized Drop (Activist Post, May 31, 2014):
Watching all aspects of the US economy from outside of the propaganda zone sometimes feels like you are watching The Truman Show.
The Truman Show, for those who haven’t seen the 1998 Jim Carrey film, centered around a completely false town. In the movie everything about the town was fake except for one person, Truman Burbank, who wasn’t in on the plot. In a sense your average person in the US, particularly when it comes to the economy, is akin to Truman. They have grown up inside this completely false environment and don’t even know it is all fake.
Virtually everything in The Truman Show-esque US economy is misinformation and completely skewed in which the creators, the US government, the Federal Reserve and the mainstream media constantly propagate blatantly false and wrong information and the American public, like Truman, have no idea that anything is even amiss.
The latest hilarious plot twist, at least for those of us watching it as observers and not intimately tied into the story, were the latest GDP numbers released showing a -1% annualized rate in the first quarter of this year. Continue reading »
Added: May 29, 2014
In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss driving GDP high on cocaine, banking fraud and new-fangled derivatives products. In the second half, Max interviews Satyajit Das about China’s debt problems and central banks’ printing presses.
- Thursday Humor: GDP – Grossly Dubious Projections (ZeroHedge, May 29, 2014):
In the middle of the last great financial crisis, the Bureau of Economic Analysis (BEA) proclaimed that Q1 2008 was the US economy grow at a modest 0.6%. This was met with hockey-stick prognosticators looking to the heavens for the next few quarters and bleeting about transitory factors affecting the economy. However, as the following chart shows, five years later (and after numerous adjustments) the +0.6% growth for Q1 2008 had somehow morphed into a clench-worthy 2.7% collapse in the economy…
- Excluding Obamacare, US Economy Contracted By 2% In The First Quarter (ZeroHedge, May 29, 2014):
As if the official news that the US economy is just one quarter away from an official recession (and with just one month left in the second quarter that inventory restocking better be progressing at an epic pace) but don’t worry – supposedly harsh weather somehow managed to wipe out $100 billion in economic growth from the initial forecast for Q1 GDP – here is some even worse news: if one excludes the artificial stimulus to the US economy generated from the Obamacare Q1 taxpayer-subsidized scramble, which resulted in a record surge in Healthcare services spending of $40 billion in the quarter, Q1 GDP would have contracted not by 1% but by 2%!
The history of healthcare spending’s contribution to GDP. The outlier needs no highlighting: Continue reading »
- US Economy Shrank By 1% In The First Quarter: First Contraction Since 2011(ZeroHedge, May 29, 2014):
Weather 1 – Quantitative Easing 0.
Spot on the chart below just how high the culmination of over $1 trillion in QE3 proceeds “pushed” the US economy.
Joking aside, while the realization that nobody can fight the Fed except a cold weather front, is quite profound, in the first quarter GDP “grew” by a revised -1.0%, down from the +0.1% first estimate, and well below the -0.5% expected, confirming that while economists may suck as economists, they are absolutely horrible as weathermen. This was the worst print since the -1.3% recorded in Q1 2011.
Bottom line: for whatever reason, in Q1 the US economy contracted not only for the first time in three years, but at the fastest pace since Q1 of 2011. It probably snowed then too.
The breakdown by components is as follows: Continue reading »
From the article:
“Therefore Renzi will have a greater margin this year to spend” without breaching the deficit limit, he said.
- Hookers And Blow: How Changing The Definition Of GDP Officially Jumped The Shark (ZeroHedge, May 22, 2014):
A year ago it was the US which first “boosted” America’s GDP by $500 billion – literally out of thin air – when it arbitrarily decided to include “intangibles” to the components that ‘make up’ GDP (in the process cutting over 5% from the US Debt/GDP ratio). Then Spain joined the fray. Then Greece. Then the UK. Then Nigeria, which showed those deveoped Keynesian basket cases how it is really done, when it doubled the size of its GDP overnight when it decided to change the base year of its GDP calculations. Now it is Italy’s turn, and like everything else Italy does, this latest “revision” of the definition of GDP easily wins in the style points category. As Bloomberg reports, “Italy will include prostitution and illegal drug sales in the gross domestic product calculation this year.” Yup: blow and hookers. And that, ladies and gents, how it’s done. Continue reading »
- If It Wasn’t For Obamacare, Q1 GDP Would Be Negative (ZeroHedge, April 30, 2014):
Here is a shocker: for all the damnation Obamacare, which according to poll after poll is loathed by a majority of the US population, has gotten if it wasn’t for the (government-mandated) spending surge resulting from Obamacare, which resulted in the biggest jump in Healthcare Services spending in the past quarter in history and added 1.1% to GDP …
… real Q1 GDP (in chained 2009 dollars), which rose only $4.3 billion sequentially to $15,947 billion, would have been a negative 1.0%!
- GDP Shocker: US Economic Growth Crashes To Just 0.1% In Q1 (ZeroHedge, April 30, 2014):
Despite consensus at 1.2% growth QoQ, the “weather” destroyed the fragile stimulus-led economy of the US which managed only a de minimus +0.1% QoQ growth (the lowest since Q1 2011). However, as Steve Liesman noted on the heels of Mark Zandi’s comments “basically ignore this number” – ok then. Spending on Services, however, surged by the most since 2000 – heralded as great news by some talking heads – but is merely a reflection of the surge in healthcare and heating costs (imagine if it had not been cold and if Obamacare hadn’t saved us). As a reminder – this is the growth that is occurring as QE has run its course, as stimulus ends, and as escape velocity nears… if the “weather” can do this much damage to the US economy, should stocks really be trading at the multiple of exuberant future hope that they are?
The full breakdown of GDP components: Continue reading »
- Capital Controls and 200% Price Hikes in Ukraine – And Ukraine Is In Better Shape Than The US! (Activist Post, March 31, 2014):
In a TV address to a torn nation, Ukraine’s PM Yatsenyuk first implied heating prices would rise incrementally, and then later confirmed a plan to increase prices 100% in the next two years (and nearly 200% by 2017) as the cost of imported Russian gas is expected to rise to $500 from the current $84.
Not only did the Ukrainians have the hard rug of the consequences of statism pulled out from underneath them, but the move was followed with tougher capital controls, which restricted cash purchases to $1,300 per person per day after the Central Bank said “amid a tense situation in money markets” it is now broke. (We covered a reported shipment of gold out of Ukraine a couple of weeks ago) Continue reading »
- Moody’s Puts Russia On Downgrade Review; Cites Event Risk, Investor Sentiment, And Weakening Economy (Zerohedge, March 28, 2014):
Hot on the heels of what S&P said was not a “politically motivated” shift to rating watch, Moody’s (who did not downgrade the USA and are not currently in a lawsuit over such terrible misrepresentations) has decided now is the time to put Russia on rating downgrade watch. The decision was triggered by 3 key factors: the weakening of Russia’s economic strength, potential shifts in investor sentiment, and susceptibility to event risk.
Full report below… Continue reading »
- S&P Brings Out The Big Policy Guns – Downgrades Russia To Outlook Negative (ZeroHedge, March 20, 2014):
S&P, still deep in the mire of a legal battle with the US government, has decided now is an opportune time to cut the ratings outlook on Russia:
- *RUSSIAN FEDERATION OUTLOOK TO NEGATIVE FROM STABLE BY S&P
- *S&P SEES EU-U.S. IMPOSING FURTHER SANCTIONS
Russia remains a BBB credit (but with the outlook shift remains open to a downgrade with 24 months). S&P has cut 2014 GDP forecast to 1.2% and 2015 to 2.2%. Of course, we are sure, this would have nothing to do with currying favors with the US government (who threatened them when they downgraded the USA). Full report below.
S&P Reduces Russian Federation outlook to Negative from Stable.
Below is the full report: Continue reading »
- If You Are Considering Buying A House, Read This First (ZeroHedge, March 15, 2014):
In September of 2011, when looking at the insurmountable debt catastrophe that the world finds itself (which has only gotten worse in the past several years) we warned that “the only way to resolve the massive debt load is through a global coordinated debt restructuring (which would, among other things, push all global banks into bankruptcy) which, when all is said and done, will have to be funded by the world’s financial asset holders: the middle-and upper-class, which, if BCS is right, have a ~30% one-time tax on all their assets to look forward to as the great mean reversion finally arrives and the world is set back on a viable path.”
Two years later, the financial asset tax approach, in the form of depositor bail-ins, was tried – successfully (as there was no mass rioting, no revolution, in fact the people were perfectly happy to accept the confiscation of their savings) – in Cyprus, further emboldening the status quo, in this case the IMF, to propose, tongue in cheek, that the time has come for the uber-wealthy to give back some (“it’s only fair”), and to raise income taxes through the roof (which of course would mostly impact the middle class as the bulk of current income for the 1% is in the form of dividend income, ultra-cheap leverage extraction on assets and various forms of carried interest).
And now, a new tax is not only on the horizon but coming fast and furious to allow the insolvent global regime at least one more can kicking: one which will impact current and future homeowners across the world.
But first, let’s step back. Continue reading »
- Fed’s Fisher Admits Stocks Are At “Eye-Popping Levels” /ZeroHedge, March 6, 2014):
While Janet Yellen fell back on the ubiquitous central banker statement that she “would do all that [she] can” it was Dallas Fed’s Richard Fisher who raised the most eyebrows yesterday. In a speech in Mexico City, the central banker said he was concerned about “eye-popping levels” of some stock market metrics warning that the Fed must monitor the signs carefully to ensure bubbles were not forming. While other Fed members have paid lip-service to bubbles, Fisher explicitly discussed stocks in the context of the dot-com boom of the late ’90s warning of “the ghost of ‘irrational exuberance'” and worried about corporate bonds too.
In his speech in Mexico City, Fisher said some indicators like the price-to-projected forward earnings, price-to-sales ratios and market capitalization as a percentage of GDP, are at levels not seen since the dot-com boom of the late 1990s.