- KINGSTON, NY - "Read
All About It!" You couldn't not read all about it! The media was full
of reports about how happy stock market days were here again. After a stormy
start, June closed and July began with US benchmark indexes racking up
their biggest weekly gains in two years on good news: the US manufacturing
index had unexpectedly risen, and the beleaguered debt-burdened Greeks
were bailed out yet again piling un-payable new debt on top of un-payable
- Yes, there was some concern, but, as The New York Times
reported on June 25th, "Two years into the official recovery, the
economy is still behaving like a plane taxiing indefinitely on the runway.
Few economists are predicting an out-and-out return to recession analysts
generally expect the economy to pick up in the second half."
- The economists were forecasting strong job growth for
June. But two weeks later, when the numbers came in, the Bureau of Labor
Statistics reported that only 18,000 jobs had been created not the
125,000 jobs projected by those same economists who were also not "predicting
an out-and-out return to recession."
- Accordingly, without missing a beat, the Times changed
its tune writing new words to replace the old words they would never
be forced to eat:
- Feeble Job Numbers Show Recovery Starting to Stall
- Defying Economists Forecast for Hiring, Unemployment
Creeps Up to 9.2%
- For the second consecutive month, employers added scarcely
any jobs in June, startling evidence that the economic recovery is stumbling
The government also revised downward the small gain for the previous month
to 25,000 new jobs, less than half the original estimate. (The New York
Times, 9 July 2011)
- "Dismal Jobs Data Rock US Recovery" and "Worries
Grow Over Jobs," read the respective headlines in the Financial Times
and Wall Street Journal on July 9th, dissipating the air of optimism that
had recently rallied equity markets.
- "Employment!" More than factory orders, GDP,
corporate profits, retail sales, durable goods employment was the one
big number that counted. There was no way to spin the consequences of 18,000
mostly low paying health care and hospitality jobs into the hopeful message
implied by the 125,000 jobs forecast by most economists.
- The equation was simple; the more people out of work,
the less they consume. And in the United States, where consumer spending
accounts for an estimated 70 percent of the GDP, without increased consumer
spending, the economy was again recession bound.
- Virtually overnight, one dire employment report unraveled
two years' worth of government spin and media complicity. In April 2010,
Vice President Joseph Biden promised, "we're going to be creating
between 250,000 jobs a month and 500,000 jobs a month." And in August
2010, Treasury Secretary Timothy Geithner declared that the "actions
we took at its height [of the crisis] to stimulate the economy helped arrest
the freefall, preventing an even deeper collapse and putting the economy
on the road to recovery."
- But almost a year later, talking on "Meet the Press,"
two days after the devastating employment data was released, the new, revised
Geithner forecast was, "Oh, I think it's [the recovery] going to take
a long time still. This is a very tough economy. And I think for a lot
of people it's going to be it's going to feel very hard, harder than
anything they've experienced in their lifetime now, for some time to come."
- Like the Biden boast long-buried and un-exhumed, the
Geithner statement, a direct contradiction of his former projection went
unchallenged, given the usual free pass by the "Meet the Press"
- There was, and is, no "return to recession."
As The Trends Research Institute had been forecasting since the onset of
the Great Recession and the "Panic of '08," all those "bold
actions" proudly cited by Geithner were no more than financial Prozac
multi-trillion-dollar band aids, palliatives, placebos and cover-ups
packaged as TARP, the American Recovery and Reinvestment Act, QE2, and
so on. At best, the "bold actions" merely guided the Great Recession
into a brief remission, and that is all.
- Global Ponzi It was a cover-up, not a recovery. And while
the US may have been the first, it was not the only nation to try to fraudulently
finagle its way out of a crisis and into prosperity. Like the US bailouts,
the Greek survival package praised as an important stopgap success
only last week has neither guaranteed keeping the Greek banking system
afloat nor guaranteed it won't default.
- Now Italy has caught the contagion. Fattest of the PIIGS
(acronym for Portugal, Ireland, Italy, Greece and Spain) the eurozone's
third largest economy with its 120 percent public debt to GDP ratio,
Italy is bleeding red ink all over its balance sheet. Borrowing more to
service its debt load and imposing draconian austerity measures to reign
in government spending will, at best, provide a respite from the financial
crisis or, at worst, foment a revolution. (See, "Off With Their Heads,
2.0, Trends Journal, Autumn 2010)
- Then there's China, who panicked when the "Panic
of 08" blew out their export driven economy, and, like the West, used
cheap credit and huge stimulus packages to prevent a major economic contraction.
While China's crisis differs from the West's in that it has large currency
reserves and its debt is homegrown and home-loaned, it's still debt and
has to be repaid.
- And unlike the West, which pumped trillions into just
keeping its economies afloat, the Chinese multi-trillion yuan infusions
have created an immense, ready-to-pop property bubble. But this time, like
the West, there will be no available fiscal or monetary government policies
to re-inflate their faltering economy.
- And as goes the US, Europe and China so goes the
rest of the world. From India to Israel, Brazil to Bangladesh, Chile to
Russia, no nation will escape the economic fallout and few will escape
the political consequences.
- Yet, despite the widely available economic facts and
the ample evidence of faulty forecasts and failed government policies,
the mainstream media continues to sell the public the big lie. By providing
cover for the politicians and financiers, the Presstitutes of the world
with their stable of "well respected" pundits are
accomplices in promoting the egregiously transparent cover-up as a "recovery."
- Trendpost: After descending to $1,480 less than two weeks
ago, as this is written, gold is flirting with $1,600. We see this surge
as a recognition of the greater financial and socioeconomic collapse we
have been forecasting since the onset of the "Panic of '08."
We hold to our forecast of "Gold $2,000," and depending on how
the coming crisis unfolds and the responses to it made by governments and
central banks, $2,000 may prove but a temporary ceiling before climbing
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Journal publisher, please contact: Zeke West, Media Relations, email@example.com
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