The strongest economy in the world

**Jet Gorgon** · 07-07-2009, 12:07 PM

^ How sweet you have a big banking analyst quote (albeit by another person) to explain the problem.

**Spin** · 09-07-2009, 11:25 PM

I love this guy, he's not best pleased with America right now and makes a weekly video to have a good rant and smash up some stuff he has thats made in China.
The irony is that he always complains about manufacturing being shut down in the US and how everything is made in China. I've been watching this guy every week for ages and he must have spent tens of thousands of dollars on Chinese stuff....only now he's complaining about it

This week he even includes a computer monitor thats made in Thailand that gets pummelled with a pick axe

**Storekeeper** · 10-07-2009, 12:10 AM

I thought the value of my home was supposed to be losing value ? How come I just got another property tax increase !!!!

**Jet Gorgon** · 10-07-2009, 02:47 AM

Originally Posted by Spin

This week he even includes a computer monitor thats made in Thailand that gets pummelled with a pick axe

Fek, Spinners, I haven't had a good belly laugh like that since I got my tax statement. Thank you. This guy is so articulate it's even more hilarious -- wonder if he has a teleprompter.

**Spin** · 10-07-2009, 03:26 AM

^ Go to his main page on youtube, he's done loads of these vids. Sometimes I'm literally crying with laughter watching this guy

He reminds me a little of Bill Hicks, occassionally dropping in a legalise hash comment.

Even funnier though, AIG like WTF?

So they do a reverse stock split 20:1 and the things goes from 1.36$ to 19$ or something and then trades down each day for 4 days and is now 9.33$

Whats all that about? It went down 29% TODAY!!!!

The people who are left holding that shit must be beyond furious!

**Jet Gorgon** · 10-07-2009, 03:33 AM

^ Saw that and this...American International Group's(AIG Quote) equity could be nearing zero -- or so says a Citigroup analyst.
The news sent shares of the flailing insurer plunging 22% to $10.26 in afternoon trading. Shares of the company have been on a downward spiral after shareholders approved a 1-for-20 reverse stock split last week. AIG closed at $1.16 that day, which is equivalent to $23.20 assuming the reverse split.
AIG's Equity Dangerously Close to Zero | Top Business News | Financial Articles & Investing News | TheStreet.com

They would have been in deep doodoo if the stock fell under a buck, so saw it coming and did the reverse.

**Boon Mee** · 10-07-2009, 04:13 AM

Source

**Spin** · 10-07-2009, 05:52 PM

FT.com has some video interviews with Hugh Hendry. This guy makes for compelling viewing and well woth a look HERE

The vids are in 3 parts from july 5th, "bond bull equity bear", "fed hasnt done enough" and "bearish on china and gold"

**Jet Gorgon** · 11-07-2009, 05:57 AM

Originally Posted by Spin

^ Go to his main page on youtube, he's done loads of these vids. Sometimes I'm literally crying with laughter watching this guy

He reminds me a little of Bill Hicks, occassionally dropping in a legalise hash comment.

This is a pro production for a gold/silver website. But, it's fekin brilliant. Sent it to 100 Yank pals and they are laughing their butts off (so they said). Guy is a great actor and baseball player. Thanks again, Spin.

**Boon Mee** · 12-07-2009, 04:50 AM

SO HOW’S THAT STIMULUS THING GOING?

Fortune magazine recently reported that the number of U.S. companies in the world’s top 500 fell to the lowest level ever, while more Chinese firms than ever before made the list. Thirty-seven Chinese companies now rank in the top 500, including nine new entries. Meanwhile, the number of U.S. firms has fallen to 140, the lowest total since Fortune began the list in 1995. This is not good.
China also surpassed the U.S. as the world’s biggest automaker in the first half of 2009, with June sales soaring 36.5 percent from a year earlier. The Chinese registered 6.1 million car sales for the first half of the year. That way outpaced American sales, which were only 4.8 million. . . .
Here’s the clincher: Year-to-date, Dow Jones stocks are off 7 percent, while China stocks are up 71 percent. The world index is up 4 percent. Emerging markets are up 25 percent. They’re all beating us. None of this is good.

Hope and change!

**barbaro** · 13-07-2009, 04:17 AM

A July 12, 2009 interview with Celente. Some repetition, but also some other things:

**Panda** · 13-07-2009, 08:08 AM

I honestly think Celente is excessively pessimistic. But his track record of previous accurate predictions is a big worry. I believe things will be extremely difficult for the bottom half income earners in USA for several years. But the economy will eventually pick up again, though with an overall lower standard of living than has been previously experienced.

US blue collar and unskilled labour generally work for much lower wages than are paid in other developed countries. Social services like health care are generally well below standards in other developed countries. Poverty levels in USA are exceptionally high considering the countries overall wealth.

Poverty in the United States - Wikipedia, the free encyclopedia

"The United Nations Development Programme, uses the human poverty index in order to assess the development with regards to poverty among OECD countries. The index takes the likelihood of a child not surviving to age 60, functional illiteracy rate, long-term unemployment and the population living on less than 50% of the median national income into account. While the United States has the second lowest long-term unemployment rate in the developed world, it has the highest percentage of children who are not likely to live to age 60 and persons living on less than 50% of the national median income and the third highest percentage of adults lacking functional literacy skills"

USA has run lean and mean with a relatitively cheap labour force in the lower skilled areas for many decades. Costs for government and industry have been trimmed to the bone under the right wing doctrine USA has chosen to follow. This has been one of USAs great strengths in the global market until developing countries recently became more industrialized and started out-competing USA on the price of labour. In 1971 USA was effectively broke after the Vietnam war and under tricky Dicky Nixon they completely abandoned the gold standard and started moving down the path of becoming a consumer debtor nation rather than a productive creditor nation in order to maintain living standards. That era of selling paper money rather than actual goods and services in now about to end.
Americans have been living above their means for nearly 4 decades at the expense of other productive nations. And this has only been made possible by the $US hegemony that the rest of the world so foolishly conceded to back in 1971.

Now when that readjustment does come, it will come with massive financial impact, not just on USA, but on the whole world.

Inside USA, by far the greatest impact will be on those many tens of millions of low skilled workers who have been just barely maintaining a basic standard of living during the past decades of debt based prosperity for the country.
Inflation and unemployment will drive many tens of millions of people into poverty.
There is bound to be a lot of soul searching, protests and blame in the coming years. The only way for governments to console desperate people (voters) in tough times is to move towards a more liberal society with a more equitable distribution of wealth and improved social services like health care.

The working class in USA have had their entitlements, their wages and their social services trimmed to the bone and have nothing more to give when times get tough. Sure they are going to rebel if they see a future right wing government screwing them even more while giving tax breaks to the rich in the hope of creating more employment. That right wing mantra has already taken to its limit of sustainability in USA. The poor have nothing more to give. A more left leaning government is the only way USA can go now.

**barbaro** · 14-07-2009, 03:57 PM

July 13, 2003:

Peter Schiff predicts 15% unemployment within the next 3 1/2 years. Also disagree with the host who's a Bull.

**Jet Gorgon** · 15-07-2009, 04:35 AM

^ The real number already exceeds that, Milkie.

**barbaro** · 15-07-2009, 06:30 AM

Originally Posted by Jet Gorgon

^ The real number already exceeds that, Milkie.

I know. Schiff is referring to the U3 rate.

Today, Geithner said the economy is rebounding - again.

But here is an article form the Wall St. Journal saying things are bad and getting worse. I'll take the Wall St. Journal over Geithner the cheerleader, anyday.

The Economy Is Even Worse Than You Think

The average length of unemployment is higher than it's been since government began tracking the data in 1948.

By MORTIMER ZUCKERMAN

The recent unemployment numbers have undermined confidence that we might be nearing the bottom of the recession. What we can see on the surface is disconcerting enough, but the inside numbers are just as bad.
The Bureau of Labor Statistics preliminary estimate for job losses for June is 467,000, which means 7.2 million people have lost their jobs since the start of the recession. The cumulative job losses over the last six months have been greater than for any other half year period since World War II, including the military demobilization after the war. The job losses are also now equal to the net job gains over the previous nine years, making this the only recession since the Great Depression to wipe out all job growth from the previous expansion.
Here are 10 reasons we are in even more trouble than the 9.5% unemployment rate indicates:

David Klein

- June's total assumed 185,000 people at work who probably were not. The government could not identify them; it made an assumption about trends. But many of the mythical jobs are in industries that have absolutely no job creation, e.g., finance. When the official numbers are adjusted over the next several months, June will look worse.

- More companies are asking employees to take unpaid leave. These people don't count on the unemployment roll.

- No fewer than 1.4 million people wanted or were available for work in the last 12 months but were not counted. Why? Because they hadn't searched for work in the four weeks preceding the survey.
- The number of workers taking part-time jobs due to the slack economy, a kind of stealth underemployment, has doubled in this recession to about nine million, or 5.8% of the work force. Add those whose hours have been cut to those who cannot find a full-time job and the total unemployed rises to 16.5%, putting the number of involuntarily idle in the range of 25 million.

- The average work week for rank-and-file employees in the private sector, roughly 80% of the work force, slipped to 33 hours. That's 48 minutes a week less than before the recession began, the lowest level since the government began tracking such data 45 years ago. Full-time workers are being downgraded to part time as businesses slash labor costs to remain above water, and factories are operating at only 65% of capacity. If Americans were still clocking those extra 48 minutes a week now, the same aggregate amount of work would get done with 3.3 million fewer employees, which means that if it were not for the shorter work week the jobless rate would be 11.7%, not 9.5% (which far exceeds the 8% rate projected by the Obama administration).

- The average length of official unemployment increased to 24.5 weeks, the longest since government began tracking this data in 1948. The number of long-term unemployed (i.e., for 27 weeks or more) has now jumped to 4.4 million, an all-time high.

- The average worker saw no wage gains in June, with average compensation running flat at $18.53 an hour.

- The goods producing sector is losing the most jobs -- 223,000 in the last report alone.

- The prospects for job creation are equally distressing. The likelihood is that when economic activity picks up, employers will first choose to increase hours for existing workers and bring part-time workers back to full time. Many unemployed workers looking for jobs once the recovery begins will discover that jobs as good as the ones they lost are almost impossible to find because many layoffs have been permanent. Instead of shrinking operations, companies have shut down whole business units or made sweeping structural changes in the way they conduct business. General Motors and Chrysler, closed hundreds of dealerships and reduced brands. Citigroup and Bank of America cut tens of thousands of positions and exited many parts of the world of finance.

Job losses may last well into 2010 to hit an unemployment peak close to 11%. That unemployment rate may be sustained for an extended period.

Can we find comfort in the fact that employment has long been considered a lagging indicator? It is conventionally seen as having limited predictive power since employment reflects decisions taken earlier in the business cycle. But today is different. Unemployment has doubled to 9.5% from 4.8% in only 16 months, a rate so fast it may influence future economic behavior and outlook.

How could this happen when Washington has thrown trillions of dollars into the pot, including the famous $787 billion in stimulus spending that was supposed to yield $1.50 in growth for every dollar spent? For a start, too much of the money went to transfer payments such as Medicaid, jobless benefits and the like that do nothing for jobs and growth. The spending that creates new jobs is new spending, particularly on infrastructure. It amounts to less than 10% of the stimulus package today.

About 40% of U.S. workers believe the recession will continue for another full year, and their pessimism is justified. As paychecks shrink and disappear, consumers are more hesitant to spend and won't lead the economy out of the doldrums quickly enough.

It may have made him unpopular in parts of the Obama administration, but Vice President Joe Biden was right when he said a week ago that the administration misread how bad the economy was and how effective the stimulus would be. It was supposed to be about jobs but it wasn't. The Recovery Act was a single piece of legislation but it included thousands of funding schemes for tens of thousands of projects, and those programs are stuck in the bureaucracy as the government

releases the funds with typical inefficiency.

Another $150 billion, which was allocated to state coffers to continue programs like Medicaid, did not add new jobs; hundreds of billions were set aside for tax cuts and for new benefits for the poor and the unemployed, and they did not add new jobs. Now state budgets are drowning in red ink as jobless claims and Medicaid bills climb.

Next year state budgets will have depleted their initial rescue dollars. Absent another rescue plan, they will have no choice but to slash spending, raise taxes, or both. State and local governments, representing about 15% of the economy, are beginning the worst contraction in postwar history amid a deficit of $166 billion for fiscal 2010, according to the Center on Budget and Policy Priorities, and a gap of $350 billion in fiscal 2011.

Households overburdened with historic levels of debt will also be saving more. The savings rate has already jumped to almost 7% of after-tax income from 0% in 2007, and it is still going up. Every dollar of saving comes out of consumption. Since consumer spending is the economy's main driver, we are going to have a weak consumer sector and many businesses simply won't have the means or the need to hire employees. After the 1990-91 recessions, consumers went out and bought houses, cars and other expensive goods. This time, the combination of a weak job picture and a severe credit crunch means that people won't be able to get the financing for big expenditures, and those who can borrow will be reluctant to do so. The paycheck has returned as the primary source of spending.

This process is nowhere near complete and, until it is, the economy will barely grow if it does at all, and it may well oscillate between sluggish growth and modest decline for the next several years until the rebalancing of excessive debt has been completed. Until then, the economy will be deprived of adequate profits and cash flow, and businesses will not start to hire nor race to make capital expenditures when they have vast idle capacity.

No wonder poll after poll shows a steady erosion of confidence in the stimulus. So what kind of second-act stimulus should we look for? Something that might have a real multiplier effect, not a congressional wish list of pet programs. It is critical that the Obama administration not play politics with the issue. The time to get ready for a serious infrastructure program is now. It's a shame Washington didn't get it right the first time.

Mr. Zuckerman is chairman and editor in chief of U.S. News & World Report.

Link: Average length of unemployment highest since 1948. - WSJ.com

**Jet Gorgon** · 15-07-2009, 07:06 AM

^ 555 That was a pretty lame suckup speech to the Arabs, Milkie. I wonder if Geithner did major kowtowing in private.
American small business folks are freaking out. No credit, more taxes ahead and hey, you got plans for 100 employees and a little mfg plant, the unions will swoop in and fek ya -- pay those wages and benefits and no way your products will be competitive in pricing or mebbe even quality. India and China ain't bowing down to no cap'n'trade crap.

**barbaro** · 15-07-2009, 07:44 AM

Originally Posted by Jet Gorgon

^ 555 That was a pretty lame suckup speech to the Arabs, Milkie. I wonder if Geithner did major kowtowing in private.

I think at this point sucking up is highly needed by Geithner. The rest of the world knows that the monetary policies may hurt holder of USD.

American small business folks are freaking out. No credit, more taxes ahead

Yeah, definitely. The SBA is still not loaning much, and business is down at all levels.

and hey, you got plans for 100 employees and a little mfg plant, the unions will swoop in and fek ya -- pay those wages and benefits and no way your products will be competitive in pricing or mebbe even quality. India and China ain't bowing down to no cap'n'trade crap.

Manufacturing is done in the US. And it's been done for a while. Remember unions are about 8% of the entire US workforce (minus government employees).

India (and much moreso China) are the MFG base. Nobody in the US can compete with a Chinese factory worker's wages, and other lack of costs and expenses.

Interesting times no doubt.

**Jet Gorgon** · 15-07-2009, 08:41 AM

Originally Posted by Milkman

[Nobody in the US can compete with a Chinese factory worker's wages, and other lack of costs and expenses.

Yep. Looks like the US is going for jobs in govt, including admin, teachers, police/fire fighters, and health care (govt = union, Milkie). Those are the only sectors going up. Seeing as how education is such a big priority, it's strange that educated uni folks can't find a job.

**barbaro** · 15-07-2009, 09:23 AM

Originally Posted by Jet Gorgon

Originally Posted by Milkman

[Nobody in the US can compete with a Chinese factory worker's wages, and other lack of costs and expenses.

Yep. Looks like the US is going for jobs in govt, including admin, teachers, police/fire fighters, and health care (govt = union, Milkie). Those are the only sectors going up. Seeing as how education is such a big priority, it's strange that educated uni folks can't find a job.

I agree, Jet. And this is a very bad sign. It means (IMO) that the private sector is not being focused on. Perhaps because, there's not a lot left for many in it.

I just returned from the US, and some of my family that has always been in private sector business have changed their tune. They said, "don't go into the private sector and the 401K. Try to get on with the government."

**Jet Gorgon** · 15-07-2009, 09:50 AM

^ EEEEEEEEEEEEEK! Hello, socialism. Who's going to make real money and pay taxes?

**Panda** · 15-07-2009, 09:59 AM

The only way USA is ever going to get back on its feet as a producer nation and pay back its debt, instead of continuing as a dead end debt ridden consumer nation is for a very substantial devaluation of the $US. And in view of the international flight into $USs in this world financial crisis, the only way for the US government to get the value of the $US down is to borrow, spend and print until the underwriters loose confidance. The US budget deficit has already hit a $Trillion so far this year and rising. Perhaps a few $Trillion more in the red will finally turn the tide.

BBC NEWS | Business | US budget deficit at $1 trillion

"

US budget deficit at $1 trillion

Unemployment benefits and falling tax incomes have widened the deficit

The US budget deficit has moved above $1 trillion (£616bn) for the first time - with three months of the financial year remaining, official data show. The government stepped up spending to counter the recession, and the bailout of financial institutions has taken a huge chunk out of government finances.
Falling tax revenues and unemployment benefit spending have also contributed.
The figure compares with $455bn for the whole 2007/8 financial year, but the 2008/9 deficit was expected to soar.
A budget deficit can impede spending on programmes such as health and education. "

**robuzo** · 15-07-2009, 10:19 AM

Really good exchange about Goldman, the banks, and influence here: Ratigan And Ritholtz Discuss Goldman | zero hedge

"The banks own the place." Indeed.

**Jet Gorgon** · 15-07-2009, 10:49 AM

Originally Posted by Panda

The only way USA is ever going to get back on its feet as a producer nation and pay back its debt, instead of continuing as a dead end debt ridden consumer nation is for a very substantial devaluation of the $US. And in view of the international flight into $USs in this world financial crisis, the only way for the US government to get the value of the $US down is to borrow, spend and print until the underwriters loose confidance. The US budget deficit has already hit a $Trillion so far this year and rising. Perhaps a few $Trillion more in the red will finally turn the tide.

Thank you, Prez Obama.

**Panda** · 15-07-2009, 10:50 AM

Tell me if you think Bush or McCain would be doing it differently Jet.

**Jet Gorgon** · 15-07-2009, 11:04 AM

^ I think the whole country is realising that socialism is the wrong way. Did the Reps spend too much in their last terms? Yes. But who controlled Congress since the last elections? Bush didn't run again, so no use pointing a stick at him. I think McCain might have supported small biz more, but who can say. He didn't win. The frightful state of the nation and the economy is what we have to focus on now.
Funny that the continued best sellers on the NY Times list for non-fiction are all Rep or libertarian views that say "stop"!

Hardcover Nonfiction

Top 5 at a Glance
1. CATASTROPHE, by Dick Morris and Eileen McGann
2. LIBERTY AND TYRANNY, by Mark R. Levin
3. OUTLIERS, by Malcolm Gladwell

Paperback Nonfiction

Top 5 at a Glance
1. GLENN BECK’S ‘COMMON SENSE’, by Glenn Beck

The Beck book has gotta hurt the libbies.

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