Yeah, What Are the Facts?

For our corrupt financial markets, any news that can be spun as good news can send stocks up. But what are the facts?

For facts one has to turn to serious people, not to the presstitute media. Among those who give us real facts is John Williams of shadowstats.com. In his October 27 report, Williams exposes the happy second quarter 2011 economic growth figure of 2.5% as nonsense. Every other economic indicator contradicts the spin.

For example, personal consumption is reported to have increased 1.7%, but this surge in consumption took place despite a 1.7% collapse in consumer disposable income! In other words, if there was an increase in personal consumption, it come from drawing down savings or from incurring higher consumer debt.

A country’s consumers cannot forever draw down savings or go deeper into debt. For an economy to recover, there must be growth in consumer income. That growth is nowhere to be seen in the US. A large percentage of the goods and services sold to Americans by American corporations are now produced abroad by foreign labor. Thus, Americans no longer receive incomes from the production of the goods and services that they consume. The American consumer market is on its way out.

[...]

After two decades of exporting US manufacturing and middle class jobs, and after a decade of consumer debt growth that has resulted in millions of foreclosed homeowners and massive credit card and student loan debt that cannot be paid, consumers have no income growth or borrowing capacity with which to fuel an economy based on consumer demand.

[...]

The Dow Jones rose 339.51 points on the phony good news, but consumer sentiment is in the basement.

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As an indication of the future, despite the positive spin on the news and the rise in US stocks, on October 27 the Japanese yen rose to a new high against the US dollar.

  Paul Craig Roberts

Gloomy Gus.

....but hey, do what you want....you will anyway.