"The more power a government has the more it can act arbitrarily according to the whims and desires of the elite, and the more it will make war on others and murder its foreign and domestic subjects. Power will achieve its murderous potential. It simply waits for an excuse, an event of some sort, an assassination, a massacre in a neighboring country, an attempted coup, a famine, or a natural disaster, to justify the beginning of murder en masse."
R. J. Rummel, Mass Murder and Genocide, 1994
In Egypt's sandy silence, all alone,
Stands a gigantic Leg, which far off throws
The only shadow that the Desert knows:
"I am great OZYMANDIAS," saith the stone,
"The King of Kings; this mighty City shows
The wonders of my hand."— The City's gone,
Nought but the Leg remaining to disclose
The site of this forgotten Babylon.
We wonder, and some Hunter may express
Wonder like ours, when through the wilderness
Where London stood, holding the wolf in chase,
He meets some fragment huge, and stops to guess
What powerful but unrecorded race,
Once dwelt in that annihilated place.
Horace Smith, Ozymandias, 1818
"I want a trained professional to analyze this. It is not unusual for the series to do something odd around Christmastide. It is not unusual for the series to diverge. Not this much."
"Now it is fairly well known that the unemployment rate is a less important metric, since people stop being counted as unemployed when no longer receiving unemployment benefits, or when they take a menial low paying job. And in a prolonged downturn you can therefore have improvements in the unemployment rate without any real improvement in overall unemployment like the labor participation rate and the median wage, which are the key indicators of a sustainable recovery.
So it makes me wonder what antics the government and the pigmen might have up their sleeve to rattle the swill bucket for mom and pop to get back into stocks, and most likely once again at a top."
"...there must be an end to a conduct in banking and in business which too often has given to a sacred trust the likeness of callous and selfish wrongdoing. Small wonder that confidence languishes, for it thrives only on honesty, on honor, on the sacredness of obligations, on faithful protection, and on unselfish performance; without them it cannot live. Restoration calls, however, not for changes in ethics alone. This nation is asking for action, and action now."
Franklin Delano Roosevelt, First Inaugural Address, 1933
Mike McDermott to Teddy KGB: "Well you feelin' satisfied now Teddy? Because I can go on bustin' you up all night."Caution: language
Oh by the way, JPM Hid Doubts On Madoff Fraud - NYTAnd there will be more.
"It was possible, no doubt, to imagine a society in which wealth, in the sense of personal possessions and luxuries, should be evenly distributed, while power remained in the hands of a small privileged caste.
But in practice such a society could not remain stable. For if leisure and security were enjoyed by all alike, the great mass of human beings who are normally stupified by poverty would become literate and would learn to think for themselves; and when once they had done this, they would sooner or later realise that the privileged minority had no function, and they would sweep it away. In the long run, a hierarchical society was only possible on a basis of poverty and ignorance."
George Orwell, 1984
"People can foresee the future only when it coincides with their own wishes, and the most grossly obvious facts can be ignored when they are unwelcome. Advertising [perception management] is the rattling of a stick inside a swill bucket."
George Orwell
"It is not necessary for the politician to be the slave of the public's group prejudices, if he can learn how to mold the mind of the voters in conformity with his own ideas of public welfare and public service. The important thing for the statesman of our age is not so much to know how to please the public, but to know how to sway the public. Those who manipulate this unseen mechanism of society constitute an invisible government which is the true ruling power of our country."
Edward Bernays
"Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, and one by one."
Charles Mackay
"Men judge more from appearances than from reality. All men have eyes, but few have the gift of insight." Niccolo Machiavelli
| Total GDP | = | C | + | I | + | G | + | (X-M) | |
|---|---|---|---|---|---|---|---|---|---|
| Annual $ (trillions) | $14.9 | = | $10.6 | + | $1.8 | + | $3.0 | + | $-0.5 |
| % of GDP | 100.0% | = | 71.1% | + | 12.1% | + | 20.1% | + | -3.4% |
| Contribution to GDP Growth % | 3.17% | = | 3.04% | + | -3.20% | + | -0.11% | + | 3.44% |
| 4Q-2010 | 3Q-2010 | 2Q-2010 | 1Q-2010 | 4Q-2009 | 3Q-2009 | 2Q-2009 | 1Q-2009 | |
|---|---|---|---|---|---|---|---|---|
| Total GDP Growth | 3.17% | 2.55% | 1.72% | 3.72% | 5.02% | 1.59% | -0.69% | -4.88% |
| Consumer Goods | 2.26% | 0.94% | 0.79% | 1.29% | 0.42% | 1.62% | -0.32% | 0.41% |
| Consumer Services | 0.78% | 0.74% | 0.75% | 0.03% | 0.27% | -0.21% | -0.79% | -0.75% |
| Fixed Investment | 0.50% | 0.18% | 2.06% | 0.39% | -0.12% | 0.12% | -1.26% | -5.71% |
| Inventories | -3.70% | 1.61% | 0.82% | 2.64% | 2.83% | 1.10% | -1.03% | -1.09% |
| Government | -0.11% | 0.79% | 0.80% | -0.32% | -0.28% | 0.33% | 1.24% | -0.61% |
| Exports | 1.04% | 0.82% | 1.08% | 1.30% | 2.56% | 1.30% | -0.08% | -3.61% |
| Imports | 2.40% | -2.53% | -4.58% | -1.61% | -0.66% | -2.67% | 1.55% | 6.48% |
► The inventory building that had been adding significantly to the headline GDP growth rate since the third quarter of 2009 has sharply reversed. This component is generally subject to the largest revisions from release to release, since the data seems to lag more than most of the series. But with that caveat, it is clear on face-value that the five consecutive quarters of inventory building has ended -- perhaps with a vengeance.
► The net growth of governmental spending has also reversed. Given the political environment in Washington and the fiscal realities facing state and municipal governments, that trend is likely real and it will probably stay with us for some time.
► As mentioned above, the BEA reports a contraction in the quantity of imported goods and services by nearly 4%. While a contraction of this magnitude has occurred quarter-to-quarter many times before, it has generally been accompanied by (and ultimately caused by) a sharp contraction in consumer spending. No such change in consumer behavior is even hinted at elsewhere in the report. The only plausible explanation for this contraction is a huge shift in market share from foreign producers to domestic sources. However, no such shift was observed in any of the larger segments of the consumer economy -- including automobiles, apparel, electronics and oil.
► Again at face-value, about a quarter of the annualized growth (or about 0.83%) came from a recovery in residential housing investment, which is reportedly now growing at a tepid 0.08% annualized rate. This was the second positive quarter for residential housing investment during the year (but only the third over the past four years), and portends well for the economy if the reported trend continues. Our concern, however, is that the data used in this series has been subject in the past to short term distortions (e.g., permit rushes to beat code deadlines).
► Consumer spending was reported to have strengthened by about 1.3%, with consumer goods now being shown to be have an annualized growth rate of 2.26%.
► The recent round of inventory building is over. Inventory cycles generally run for a number of quarters, with the last building cycle running for 5 consecutive quarters and the last inventory draw-down lasting for 8 consecutive quarters. Inventories are likely to be a drag on the GDP over at least the next year.
► Governmental support of the economy has begun to sharply decrease. Mr. Bernanke notwithstanding, real commerce created by governmental entities has begun to decline, and it is likely to continue to do so for the foreseeable future.
► The recent rapid increase in commodity prices has caused a correspondingly rapid decrease in reported imports. Not reported is what the same rise in commodity prices has done to the purchasing power of consumer take-home pay. If the 31% swing in the quarter-to-quarter price of imported goods is correct, real discretionary consumer spending is about to take a serious hit.
