Notes on the Economy – January 2012

My continued apologies to my regular readers – my work and school schedules continue to keep me from writing as much as I’d like. However, there have been some significant developments in the economic world over the past month that I would like to offer my humble opinion.

OWS Gearing up – Ignored by the Press

After a relatively short and mild winter, the Occupy Movement has started to mobilize again in late January, despite increasingly violent attacks by authorities. In particular, Oakland, California appears to be the epicenter of the violence as the mayor has all but declared martial-law on the peaceful protestors.

Meanwhile, Congress and local authorities have been preparing for the eventual surge in protestors by passing legislation that gives more authority to police and military personnel to arrest and detain citizens without charge by tacitly linking occupy protestors with terrorists. You can now be arrested and detained without charge if you have stockpiled over a week’s worth of food and someone has accused you of suspicious, possibly terrorist, activity. In other words, on the tip of neighbor that sees you unloading an unusual amount of groceries into your home, you can be arrested and detained indefinitely pending the outcome of an investigation. Since Occupy Camps actively stockpile food to feed their own members and the homeless who stop by their camps, authorities now have the ability to break up the camps in the name of National Security, no matter how peaceful its participants are.

The press, of course, have been told to ignore these violations of Civil Liberty.

The Stock Market

Equities Markets have been jumping up and down like a Mexican jumping bean, but they have been gradually moving into positive territory all month, despite the news behind the news that things may not be as rosy as we all think they are. If you’re investing in the stock market, you’re probably a little better off than you were on January 1st, but you’re not dancing in the streets, either.

The earnings news was mixed and downright confusing. For example, how can major retailers be on the verge of bankruptcy while the government claims that manufacturing is up?  How can consumer confidence, housing starts, home prices, real wages, and bank profits be down while at the same time manufacturers claim that they added 170,000 new jobs in January?  The trade deficit continued to grow in the Fourth Quarter of 2011, so where is all these new Goods going?  Certainly not to domestic nor International Markets, so where?

It looks to me that the messenger is doing its best to control the message in the hopes that if it repeats the big lie long enough people will start to believe it, and the public in general is so desperate for good news they’re willing to swallow it without really thinking about it.

Europe and Asia

As expected, it really doesn’t matter how many “accords”, “deals”, or whatever they’re calling them these days they come up with, the fact of the matter is that Greece is on the verge of a complete economic collapse.  What they aren’t telling us is that the collapse has already occurred and now all they’re trying to do is to contain the violent revolution that’s brewing there. It’s anyone’s guess as to how much longer they can hold the wool over the eyes of the people before they get to the point when they stop listening.

China’s economic data suggests that their overheated economy is continuing to lose steam, but the media wants to ignore this fact. The media like to portray China as the most stable economy in the world right now, which couldn’t be further from the truth. What goes up, must come down, and the higher it soars, the harder it falls.

The Republican Primary Season

Despite a brief flirtation with hard-core Conservatives Rick Santorum and Newt Gingrich, Mitt Romney is the predictable front-runner for the Republican nomination. Ron Paul supporters seem to be under the delusion that their strong showings in Iowa, New Hampshire and Florida will mean that they will have a seat at the table for setting the GOP Platform.  Nothing could be further from the truth.  If the media and the Old-Guard have ignored you up to this point, what makes you think they’ll start listening to you now that you’ve lost the Primary? Republicans also seem to be under the delusion that by choosing a Moderate from Massachusetts that they will have the best chances to beat Obama in November. How soon we forget 1996 and 2004. When the alternative candidate is practically indistinguishable from the incumbent, the incumbent always wins.  If Ron Paul decides to run as an Independent, Obama will win, but I’m sure Dr. Paul will make a very strong showing in the Popular vote just as Ross Perot did in 1992.

I leave room to be surprised on Super Tuesday, but in the end I’m a realist. Romney’s got this in the bag as the anointed challenger to Obama, which means the Obama will beat him easily, despite a poor economy.

Things Going As Predicted

As predicted, the January economic indicators performed exactly to my expectations with absolutely no surprises, although I continue to underestimate the people’s capacity for self-delusion when it’s supported by the media’s full-court-press to convince us that things are better than they actually are.

The Occupy Movement will attempt to gain steam in the coming month, but the media and the Powers-That-Be have already seen how effective they can be when they ignore a movement with strong grass-roots support and now they’re doing the same thing to the protestors. If Congress is successful at censoring the Internet under the pretext of protecting against Internet pirates, the Tea Party, OWS and the Ron Paul Revolutionaries will be further hobbled from getting their message out to the people.

As the Election Year continues to go full-steam, expect more unbelievably optimistic economic news coming out of the media (except for FOX News, of course) as they try to paint Obama as the successful CEO of the country.  Every government agency in the Executive Branch will back him up, too.  It worked for George W. Bush, so why can’t it work for the current President?

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