Which is your favorite paranoid fantasy?

[tw]

Originally Posted by Undertoad

The economy has been very seriously booming for the last year and a half. Growth is up, unemployment is low, profits are way up and in this most recent report wages are increasing. By every measure, things are awesome.

We were arguing here in the Cellar back in early 1990s that the economy sucked. Meantime Greenspan was saying growth and productivity increases were everywhere - except on those spread sheets. Later those spread sheets finally found growth.

You may remember back in the early 90s when I posted "This is the best it gets". Years later, the spread sheets finally reported same. The growth that Greenspan insisted existed finally appeared even in spread sheets.

Shop in any grocery store to see inflation. Government reports kept claiming there was no significant inflation. Right. The Fed has long worried about inflation that somehow does not appear in those spread sheets. Even the stock market sees no booming economy. Just like those spread sheets in 1990 - today’s spread sheets only report things that occurred 4 and 10 years previously. The economy has not been booming. And now the spread sheets are finally reporting a downturn.

Major storm clouds are everywhere. Inflation is galloping as indicated by the massive numbers of dollars floating overseas - in numbers so large as to even contribute to inflation in some other nations. Yes, anyone can keep printing money - using many financial instruments - and the resulting downturn does not occur for many years later (ie Vietnam late 60s then created mid 70s downturns).

Where is all this growth? A myth created by wild government spending. Pay everyone to rip up their lawn and replant it - and those same economic numbers would claim a booming economy. Eventually economics takes punishment for such wild spending. But it takes four and more years for spread sheets to actually measure reality. We are now just seeing the punishment for Bush tax cuts - as we saw after the Kennedy tax cuts - recession.

How deep is the denial? Oil has gone from $20 per barrel to $75 per barrel - and finance fiction writers still claim this has not harmed the economy. They even hype a myth that the economy is no longer so dependent on oil. Only a fool would believe stock brokers who have little grasp of what makes the economy tick. No wonder stock brokers claim there is almost no inflation and the Fed is completely wrong. Welcome right back to 1970s Deja Vue. Major storm clouds are brewing. The PBGC fiasco just one example of wild and unjustified spending.

If the economy is booming, then why has rosy stock broker hype resulted in near zero stock growth during George Jr rein. Just like in the 1990s, it took years for those no growth spread sheets to finally discover massive productivity increases. Today it will take years for those same spread sheets to report a downturn. And yet those who are not fooled by stock broker hype are saying the downturn is already here - in the stock market. We must now pay for George Jr massive 'spend spend and enrich the rich' economics.

If things are so awesome, then why does the stock market not reflect same? On 1 Jan 2000, the Dow was at 11,500. Six point five years later and it is only at 11,200. Add in maybe a few points of inflation every year and the stock market is even worse. Where is this growth? Where is this 8% annual increase that still is not sufficient to protect those pension funds (that assumed 9% growth annully)? The only awesome in the economy is how the richest have become so much richer. With inflation, the average Joe has been losing wealth for many years now. Amazing how mental midget economics is hyped when those who best know the economy - stock markets - instead show a 6 year recession. The rich - the upper most less than 5% - are getting wealthier.