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Monday, May 23, 2016

Sunday, May 1, 2016

David Stockman : Central Banking Is Dead In The Water









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The Cult Of Central Banking Is Dead In The Water
New York City, New York
May 1, 2016
David StockmanThe Fed has been sitting on the funds rate like some monetary mother hen since December 2008. Once it punts again at the June meeting owing to Brexit worries it will have effectively pegged money market rates at the zero bound for 90 straight months.
There has never been a time in financial history when anything close to this happened, including the 1930s. Nor was interest free money for eight years ever even imagined in the entire history of monetary thought.
So where’s the fire? What monumental emergency justifies this resort to radical monetary intrusion and repression?
Alas, there is none. And that’s as in nichts, nada, nope, nothing!
There is a structural growth problem, of course. But it has absolutely nothing to do with monetary policy; and it can’t be fixed with cheap money and more debt, anyway.
By contrast, there is no inflation deficiency—–even by the Fed’s preferred measure. Indeed, the very idea of a central bank pumping furiously to generate more inflation comes straight from crank economics central.
The following two graphs dramatize the cargo cult essence of today’s Keynesian approach to central banking. Since the year 2000 when monetary repression began in earnest, the balance sheet of the Fed has risen by 800%and the amount of labor hours used in the US economy has increased by 2%.
At a ratio of 400:1 you can’t even try to argue the counterfactual. There is no amount of money printing that could have ameliorated the essentially “no growth” economy symbolized by flat-lining labor hours… Read more »

Future Of America? – More Than Half Of All U.S. Adults Under Age 30 Now Reject Capitalism

Future Of America? – More Than Half Of All U.S. Adults Under Age 30 Now Reject Capitalism

Young People Abstract - Public Domain

A shocking new survey has found that support for capitalism is dying in America.  In fact, more than half of all adults in the United States under the age of 30 say that they do not support capitalism at this point.  You might be tempted to dismiss them as “foolish young people”, but the truth is that they are the future of America.  As older generations die off, they will eventually become the leaders of this country.  And of course our nation has not resembled anything close to a capitalist society for quite some time now.  In a recent article, I listed 97 different taxes that Americans pay each year, and some Americans actually end up returning more than half of what they earn to the government by the time it is all said and done.  So at best it could be said that we are running some sort of hybrid system that isn’t as far down the road toward full-blown socialism as most European nations are.  But without a doubt we are moving in that direction, and our young people are going to be cheering every step of the way. (Read More….)

Economy In Decline: Apple Reports Massive Revenue Decline As iPhone Sales Plummet Dramatically

Apple iPhone And Apple Computer - Public Domain

Corporate revenues in the United States have been falling for quite some time, but now some of the biggest companies in the entire nation are reporting extremely disappointing results.  On Tuesday, Apple shocked the financial world by reporting that revenue for the first quarter had fallen 7.4 billion dollars compared to the same quarter last year.  That is an astounding plunge, and it represents the very first year-over-year quarterly sales decline that Apple has experienced since 2003.  Analysts were anticipating some sort of drop, but nothing like this.  And of course last week we learned that Google and Microsoft also missed revenue and earnings projections for the first quarter of 2016.  The economic crisis that began during the second half of 2015 is really starting to take hold, and even our largest tech companies are now feeling the pain. (Read More….)

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