Saturday, April 30, 2011

Doug Casey: Precious Metals vs. the USD

 (snippet)
TGR: So, you're saying we're confusing the market's performance with the economy's performance?

DC: Yes. The fact is that the economy, itself, is doing very badly. The numbers are phonied up. I spend a lot of time in Argentina. Anybody with any sense knows you can't believe the numbers coming out of the Argentinean Government Statistical Bureau, nor can you (any longer) believe the numbers that come out of Washington D.C. The inflation numbers consider only the things the government wants to look at and are artificially low. It's the same with the unemployment numbers. None of these things is believable.

TGR: Isn't the unemployment figure a lagging indicator of a rebounding economy?

DC: If you look at the way unemployment was computed until the early 1980s—something that John Williams from ShadowStats does—the numbers would indicate about 20% unemployment today. Besides, even while the population keeps rising, the number of people reported as actually working is level or even lower. Most indicators of the economic establishment, in my view, don't really make any sense. GDP, for instance, includes government spending—much of which amounts to paying some people to dig ditches during the day and other people to fill in for them at night. So-called "defense" spending is almost totally wasted capital. The practice of economics today is pathetic and laughable.

TGR: So, the economy is not rebounding?

DC: No. My take on this is that we entered what I call the "Greater Depression" in 2007. And now, because the government has printed up trillions of dollars in the last couple of years, we're in the eye of the hurricane. We've only gone through the leading edge of the storm. People think this will just be another cyclical recovery like all the others since WW II. But it's not. It's going to wind up with the currency being destroyed. It's going to be a disaster. . .a worldwide catastrophe.

TGR: You indicated that the government is using these mass infusions of made-up money to prop up the stock market due to the psychological factor—that people will think the economy's doing well because the market is doing well. However, we hear that a lot of that money has been caught up in the banks. Would you comment on that?

DC: As I said, that money has to go somewhere. The banks have been borrowing from the Fed at something like 0.5% and investing it in government securities at 2%, 3% or 4%, depending on the maturity. So, much of that money has been a direct gift to the banks; and they're basically making an arbitrage spread of 2%–4%. So, yes, that's happening with some of the money. Still, it doesn't all just sit in these Treasury securities. A great deal of it, inevitably, goes into the stock market.

TGR: You also said that psychology isn't the only reason the government wants to see the stock market go higher.

DC: Right. Pension funds have a great deal of their assets in stocks. Certainly, many funds run by government entities, such as the state and city employee pension funds, are approaching bankruptcy despite the fact that the Fed has driven interest rates to historic lows, artificially pumping up both stocks and bonds. And, I might add, keeping property prices higher than they would be otherwise. When interest rates rise eventually—and they will go up a lot—it'll be something to behold in the markets.

12 comments:

  1. Yeah! Suck it baby! Motherfucking capitalist. Hey we got it going down in Madison. We are taking back this country from the baby killing Republicans. All of you Trump fans, or Ron Paul (Hitler) stooges, I got one for ya here suckers.

    NEW DECLARATION OF INDEPENDANCE ~

    1) WE WILL REDISTRIBUTE THE WEALTH!

    2) WE WILL STOP ALL EARTH DESTROYERS!

    3) OIL, COAL, AND NUCLEAR PLANTS/MINES WILL SHUT DOWN!

    4) WE WILL PUT AN EQUAL NUMBER OF BLACKS, HISPANICS, ASIANS, GAYS, AND INDIANS IN POWER AS THERE ARE WHITES!

    5) ABORTIONS WILL BE GIVEN TO ANYONE AT REQUEST, NO MATTER THEIR AGE OR IF THEIR PARENTS DISAGREE, WITHOUT HESITATION!

    6) POWER TO THE UNIONS!

    7) EXECUTIVE ORDER WILL BE GRANTED TO OBAMA SO HE CAN BRING THIS ABOUT!

    8) DENYING GLOBAL WARMING, CRITICIZING THE LEADERS OF OTHER NATIONS, AND NOT WANTING SOCIAL JUSTICE FOR ALL PEOPLE WILL BE CRIMES!

    9) FREE HOUSING, FREE MEDICAL CARE, FREE CARS, AND FREE SCHOOLING!

    10) GOD NEEDS TO LEAVE THE US! AND THE SOLDIERS OVERSEAS NEED TO BE DEPORTED TO MOSCOW!

    How about them apples? FUCK YOU REPUBLICANS! YOU'RE THE REAL ENEMY OF AMERICA! AN ENEMY OF EARTH! AND AN ENEMY OF KARL MARX!

    ReplyDelete
  2. I offer to your attention a film about six priorities of the generalized instruments of management by countries and people of Earth.
    Six Principles of Global Manipulation
    http://www.youtube.com/watch?v=0fF3TQ0lJnU

    ReplyDelete
  3. i didnt know wether to laugh or to cry.

    jacob troupe is an embarrasment to nature.

    ReplyDelete
  4. Never mind Jacob Troupe, what about Pensions at risk during the next great market crash?
    Who's going to pay for all these aging baby boomers and seniors care?
    The Government will have plan B in place, some kind of exotic super virus that will wipe out anyone over age 55, Did anyone ever see "Logan's Run"?

    ReplyDelete
  5. listen up, troupe.
    God is real. He has shown this me a long time ago. And he has punished those who have wandered from his ways many times. And people like YOU are the reason why America will be punished with an economic collapse so terrible you may not even survive. So i suggest you get ready.

    ReplyDelete
  6. 12:48 I totally concur with you! "jay-cobb" is a freak imbesile! I like his passion, but he doesn't have a clue.

    ReplyDelete
  7. @Jacop Troupe: You are a moron! You can redistribute and give, give, give free everything to everybody, who the hell do you think is going to work in order for you to give it all away? I for one will no longer be a financial producer. Suck that!

    ReplyDelete
  8. haha! I'll let you all know something at this time. My name isn't really Jacop Troupe. And I'm not really a socialist/liberal. I've just been making these comments to see how you'll react.

    Pretty funny huh? If I had encountered posts like the one I made earlier I would definately believe that man to be a fucking idiot too.

    ReplyDelete
  9. I knew it was you all along Sam!

    ReplyDelete
  10. THE VOICE OF THE NEW WORLD ORDER HAS SPOKEN:
    listen up Sheeple, you are to refrain from consuming all the worlds resources.
    You will pay more for energy and food!
    You will be herded like sheep, sold and butchered!
    Your only purpose in life will be to serve the elite.
    The New World Order will prevail!
    prepare for our time has arrived!

    ReplyDelete
  11. Maybe you're a jag-ass if you believe:

    -in abiotic oil
    -in God
    -that 911 was a conspiracy
    -that your DNA is worthy of reproduction
    -the gubmint 'cares' about you
    -that anybody cares what you think.

    ReplyDelete
  12. 4:26
    Ok - I'll give you the Gubmint line
    The rest
    Your out of line - way out of line

    Don't you worry though

    I guarantee you'll be whipped back into line

    ReplyDelete

Everyone is encouraged to participate with civilized comments.