Monday, December 29, 2014

Jan 2, 2015 Socialism takes away the personal headaches of compassion, purpose, and hard work. US construction spending slipped 0.3 pct. in November. US Manufacturing also slipped to 55.5 the level before the administration began hyping a recovery. No one trusts anything Obama says for very good reasons.

http://research.stlouisfed.org/fred2/series/NAPM/
Government supported universities and commercial service groups that depend on government grants cannot paint statistics in rose colors too long before their government bought corruption becomes obvious and Americans lose confidence in Obama’s experts too! 
The MIT professor who Obama paid $4,000,000 to and several states paid a total of  $2,000,000 to, said Americans are just too stupid to see what the leftists are doing. 
Gruber was paid $6 million for his information.  All of Obama’s US economic statistics are paid for in one way or another by the Obama administration.  Do you really believe our economy is now recovering?  I want to believe it but what I see happening does not support the numbers. 
As the new US recession becomes obvious there will be an avalanche of bad news that must become a crescendo before wall street promoters such as Jim Cramer will admit the truth and say “They (in the administration) are nuts!” again.  But the last time in 2008 the market was already down 30%, about half way to the low before the promoters told the truth.



Remember, this will probably take more than a year to unfold with many spikes on good news such as Putin and Kim Jong Un coming around and acting like mischievous but good boys again. 
And oil and other commodity prices will be bottoming.  The greatest threat is a great depression where the FED no longer pushing for us but is rather pushing on a string that does nothing.   At that time we will become essentially a third world socialist economy.  But what difference does that make at that point?
Germany now has negative real interest rates and is pushing on a string.  Of course the last German great depression brought about Nationalist Socialism in Germany and a secret treaty with Internationalist Socialists in Russia to simultaneously invade and divide up Poland and then the rest of Europe.  Bullying is what socialists do best after they take everything else from their people.

We will not likely see a great depression if we can vote all the leftists and socialist out of office within two years.  But if it begins to look like they will stay in office we believe the stock market will be down 90% before Obama leaves office.  But Hillary will not have a Republican or Conservative to blame in that case and she as usual will not be competent and up to her assignment’s responsibilities. 


Hilary blamed her fiasco on a poor Jewish film maker not the Moslem Terrorists, not her lack of preparation for her job, and not her irresponsibility in not taking care of the Americans she directed.  But what difference does that make to Hilary even now much less then?



 Because so much of politics and economics are psychological our normative perspectives tend to become self fulfilling.  For that reason when people are selling something they take a very positive position least they lose the sale.  For that reason we are also bombarded with endless optimistic projections from those who long for the 50year business cycle that existed 2000 years ago in Biblical times when for one short year every 50 years there was a jubilee year when all debts were forgiven.  In the Jubilee year everyone started again with a clean state.  It was only 60 years ago that the business cycle was believed to be just four years long and that every 20 years there was a mild economic depression when debt was often forgiven.  The business cycle has been growing again and our current business cycle that began its decline in early 2007, has been rising since early 2009.  This cycle is almost twice as long-in-tooth of the old 4-year business cycle.  Our sell signals started in October 2014 and the market has been similar in swings and perception to those early runs and plummets of 2007 and 2008.  


Confidence in American leadership has been critical in world economics since WWI.  The only difference now is that the current administration has lost all credibility and they can no longer blame anyone else for the coming economic correction.  And this administration has lost confidence worldwide and has created far more doubt about America’s competence and steadfastness than any previous administration.   And that is the biggest problem we face. 



The only thing we have to fear is this administration itself, because this administration cannot handle any fear.  Look at their crazy reaction to Ebola and then the administration’s subsequent dead silence when they stopped their panicking.  This administration’s believers will be the first jumping out of the windows when the economy drops in 2015.  Let’s hope nobody follows them.





The BRICs are beginning to tumble.  Russia and Brazil are already in decline and will take more than one year to unwind their very different obstacles of corruption and debt.  Lower commodity prices in the developing world will put a strain on their economies.  China’s growth is slowing rapidly and is likely not going to bottom out for at least two years perhaps at a more normal 4% to 5% growth rate.  But China will have to tackle corruption, authoritarianism, and pollution or forever become a shunned backward bumbling country like N Korea.

Japan seems to be rapidly growing their Quantitative Easing even after that policy failed miserably each time it was used since 1980.  QE has led to close to zero growth relative to the growth of the US dollar for 24 years now.  Japan thought they would overtake America until 1990.  Then they launched their Quantitative Easing.  And knowing that QE was a complete failure for Japan, the USA’s FED was allowed by Obama to start it up again after it was first phased out and the economy was recovering.
Britain’s productivity continues to decline although their austerity program seems to have righted many of the fiscal excesses.
http://www.goldmansachs.com/our-thinking/outlook/2015/index.html?videoId=99568


Dec 31, 2014  The greatest threat of a free enterprise recession is, that it is just as economically bad as socialism is at its very best.  Therefore all the leftists and Elizabeth Warren socialists then come out and say at least under Mao, Castro, and Stalin no one was left out except for scientists, intellectuals and basically everyone who has depended on their brains or compassion to live.   Socialism takes away the personal headaches of compassion, purpose, and hard work.


After WWII we had a space race between the imprisoned German scientists in Russian work camps and the free German Scientists we invited to America and Great Britain.   As the scientists died off, Russia collapsed but under the free world’s free enterprise the scientists had an economic multiplying effect.   The Soviet scientist Lysenko singlehandedly destroyed Soviet genetic science by making it a socialist science much the way American idiot leftist professors destroy science, healthcare, the social sciences and economics in America at places like the EPA, MIT and Harvard.  We now have the Harvard professor who claimed she was a Cherokee in order to get a Harvard post and we have the MIT professor who said Obama had to lie about Medicare because Americans are too stupid to know what is best for them.  We have our school leftists who have taken American education from being #1 in 1963 to being #26 in the world in 2014.  We have a leftist run welfare system that provides cash incentives to break up the American family.  Russia is in a worsening recession and much of the world is lapsing into disease, famine, and terror as the leftists tear down and institutionalize charity, kindness, and committed trusting relationships which are foundations of the laws and life in free societies.  Leftists in East Germany and the USSR ended up training their neighbor’s children to spy on their parents.
 
New Home Sales Nov 438K down 4.3% from last month and still making very little progress liquidating the inventory of defaulted Liar-Loan houses sitting there unoccupied since 2007.
 
Obama’s continuing unemployment claims keep rising even though he says fewer people are getting onto unemployment each week, and unemployment has not been extended so people still have to leave unemployment as scheduled.   That is one of Obama’s economic miracles and why his government statistics indicate he also thinks he walks on water and is not smart enough to know American’s can see through his incompetence.
 
Consumer confidence looks like the same roller coaster we saw in stocks before 2000 and 2007 just before their bubbles burst.  It has been a descending ride of American confidence in since the DOTCOM bubble.  It also shows we are at the top of the ride and about to drop.
 
Similarly Consumer Sentiment is back to where it was on Obama’s first presidential election campaign in 2007 before the Dodd-Frank-Obama Liar-loan derivatives market collapsed.  And think how absurd it is that Obama allowed Dodd and Frank to give input on the new banking regulations.   After the Stupid-Party is thrown out of office ASAP the banking regulations have to be made simple to govern because obtuse regulations are the greatest source of the legalized corruption endemic in socialized nations like Russia and China.
 
Spain has kept Goldman Sachs’ $835,000,000 loan in the failed Banco Espirito in that bank with that bank’s total estimated liquidation value now estimated to be only about 25% of just the Goldman loan alone.  We are now seeing some of the high risks that banks have been taking in Libya, Spain, and other weak or unstable areas.  These are the first stones that the ships of enterprise hit when the flow level in the economic river of investment gets low.  The cause of a 60%-70% stock market drop is never imagined until it happens.  A billion dollars lost here and there begin to add up during a 12 to 18 month economic contraction.
 
Dec 29, 2014  Volatility Ahead-  If you look at the Real Estate ETF called URE back to 2007 and 2008, the number of shares exchanged looks ridiculously high because the ETF dropped so much and had many stock splits along the way.  That is easy but not necessary to correct to recognize the volatility during that last stock market decline.  Obviously people who set narrow price range targets then were quickly liquidated if they used standing orders because individual investors cannot put in standing orders more than 25% above the market.  In other words the average investor in ETFs will be sold out of that kind of market quickly because they will be whip sawed and net values will decline so rapidly that those who hold will fold without benefitting from the spikes in appreciation.   So for many, the best strategy would be to withdraw and re-enter the market when it is lower, perhaps 50% to 60% lower.   For others who study the market there could be extraordinary value ahead.
 
Russia today is much the same as it was in 1858 when Abraham Lincoln wrote a letter to convert a longtime friend and still a slave-holder Joshua F. Speed (24 August 1855):  As a nation, we began by declaring that "all men are created equal." We now practically read it "all men are created equal, except negroes." When the Know-Nothings get control, it will read "all men are created equal, except negroes, and foreigners, and Catholics." When it comes to this I should prefer emigrating to some country where they make no pretence of loving liberty — to Russia, for instance, where despotism can be taken pure, and without the base alloy of hypocrisy [sic].
 
The Know-Nothings currently have control of our educational system.  Historically the fascists and other dictatorships of the proletariat first disarmed the general population and then used a secret police, the schools, and a Gulag to control their populations.  Under Obama the elitist Know-Nothing proletariat has taken American heritage out of the schools and inserted a new interpretation of the Constitution’s 2nd Amendment to support demigod gun control.  In America our armed civilian population is still larger than any standing army and we also have a well regulated militia necessary to the security of a free state.  The original American militia evolved to become the U.S. National Guard.  But the 2nd Amendment also says, “the right of the people to keep and bear arms shall not be infringed.” Abraham Lincoln warned Americans that America can never be destroyed by any outside force only by the internal rot of Know-Nothings should they get control.  It is too bad America’s Know-Nothing demigods do not emigrate to Russia or Cuba where they would feel much more at home with gun control and income redistribution.  Socialists intentionally create economic crises to blame entrepreneurs and take government control.
http://libertyunyielding.com/2014/03/24/common-core-textbook-rewrites-second-amendment/#JQy21Cf24CEW4l03.99
 
As President Obama’s chief of Staff once said:  Rahm's Rule: You Never Want A Serious Crisis To Go To Waste.'  Certainly socialist like Hitler, Lenin, and Castro took every opportunity to acquire dictatorial power.  You can count on socialist opportunists to make a crisis worse to consolidate power and take away rights.  But most Americans now know this and plan to throw the socialists out at every opportunity.
http://www.foxnews.com/politics/2011/01/11/video-rahm-emanuel-clarifies-2008-comment-never-want-serious-crisis-to-go-to/
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