A False Recovery

Lately, our liberals have been pumped over the stock market rising to record highs – to them (you know, the people who were occupying Wall Street in 2012), this is proof positive that Obama’s economic policies have worked.  I’ve been pointing out since 2009 that pumping fake money in to the economy merely allows everyone to hide the true economic facts and that eventually there will be a renewed collapse.  This inevitable collapse will be worse than the original crash as there is more debt and fake money infecting the economy.  I quite honestly didn’t expect that Bernanke and Obama could keep the ball in the air this long – I also didn’t think that anyone, not even a Ruling Class bankster like Bernanke, would be stupid enough (apparently) to think that he can print money forever.  These days, I wouldn’t be surprised if the Dow hits 20,000 – after all, when the latest ISM – Manufacturing report came out today showing economic contraction, the stock markets initially surged…likely because people believe that bad news means Bernanke will print even more, thus shoving stock prices higher.  But, still, reality is out there.

The reality is that Europe is in a crushing recession – indeed, with youth unemployment in some countries in the 50% range, its in a crushing Great Depression.  China’s economy wobbles along mired in hidden debt and massive corruption (and very fake official government economic reports).  And, I believe, we are in recession – and a recession with a nasty stock market and real estate bubble (sound familiar?).  This article over at Zero Hedge is the best description of our circumstances – and just why a high Dow isn’t a sign of economic health.  I heartily recommend reading it.  It concludes thusly:

A good case can be made for the fact that there is no recovery and that we are just beginning our decline. The efforts of government merely served to drive us more deeply into debt and stave off normal economic healing. If this observation is correct, all that has been accomplished is a postponement and accentuation of the pain to come. My economic sense tells me that is the case.

Whether you accept this conclusion or not, don’t be fooled by the performance of the stock market. There is little other than inflationary Fed policy to justify financial asset prices. Furthermore, recent performance really isn’t special as those living through the 1930s learned. In fact, what has happened recently doesn’t even measure up to the initial rebound that occurred during the Great Depression.

Time will come when this cannot be sustained.  Today, tomorrow, next week, next month, next year.  Pain cannot be avoided – a crash must and will come and it will hurt.  The only thing we can do is try to get some policies which will allow us to climb out of it swiftly.  Unfortunately, it is impossible for us to get such policies on a national scale until Obama leaves office.