Want to Get Depressed About the Economy?

Then The Automatic Earth has an entry tailor made for you:

…However this may be, I urge you to take another look at the Consumer Metrics Institute data. Realize that their Growth Index is a leading indicator, and thus both the S&P 500 and the US GDP numbers, if we take the last five years as a measuring stick, will, over the next quarter, follow the Growth Index down. Way down.

As per this morning, the discrepancy between US GDP (official estimate still +2.45%) and CMI Growth Index (-5.25%) is a staggering 7.7%!. And then look at how closely the two are correlated in the graphs…

…If we get anywhere near what the CMI data (seem to) foresee, we’ll have drama, tragedy, mayhem and panic all wrapped in one neat package. The US economy cannot withstand anything even near that sort of fall and pretend the world is still the same…

Indeed. Do read the entire linked article – even if it doesn’t turn out quite that way, the data is still indicating some really rough sledding ahead for us.

As I’ve said before, we can’t avoid the crash. This crash, when it comes, will just be the completion of the crash which started in 2007 and which should have been allowed to continue. The banksters and bureaucrats – taking in former President Bush and President Obama, in turn – didn’t want that to happen because that would risk their own power and wealth. Having lived off (and progressively wrecked) the productive economy for 80 years, they saw now reason to stop now. What they did, however, was just store up a worse problem for the rest of us.

The crash can’t be stopped – prices inflated by fake money and financial wheeling and dealing are unsustainable. They simply must get in line with reality – and that is going to hurt. Its going to hurt worse, now, because the banksters and bureaucrats did what they did (shorthand: the piled more debt on a problem caused by too much debt – gasoline, fire; that sort of thing). All we can do at this point is endure it and then implement policies which will cut the banksters and bureaucrats out of the picture and allow regular Americans to work their way back to wealth.

It can be done and it will be done – it is just a pity the fools who ran us in to the ground got one more shot at it.