< HOME  Sunday, April 16, 2006

So-Called Economists Clueless As Economy Collapses

Faced with a systemic financial and economic collapse they don't want to face, a number of so-called economists, columnists, and financial institutions have been engaging in acts of public masturbation.

[They] are like sophmores in an economics classroom, masturbating, sitting there in fantasty-land, faced with a reality they don't want to acknowledge.

-- Lyndon LaRouche, April 14 2006
Raunchy characterization? Maybe. But, is it accurate? Unfortunately, yes.

Take, for example, some of today's comments:
"People ought to lighten up," . . . "Is there any financial crisis out there? If you look at the data, we're close to 5 percent real GDP growth, 10 percent profits growth, the best job creation since the first quarter of 2000. Consumer confidence is at a five-year high. None of that sounds like an economy ready to die -- yet that's what I read in the paper every day." . . .

"If the Fed is so tight, why is there so much damn money out there?" he said. "There's no liquidity shortage of U.S. dollars anywhere in the world. Banks are chock-full of U.S. dollars. They're running through the stock market, the bond market, the commodities market, exploding through the housing market. One reason corporations haven't borrowed any money in this cycle is they don't need to because they've got so much cash in their balance sheets."

-- James Paulsen, chief investment strategist at Wells Capital Management in Minneapolis

* * *

"We're close to being at the end of rising short-term rates and housing has not cratered as a result,"

--James Walker, global investment specialist at JPMorgan Private Bank in San Francisco

* * *

"[R]ate increases [will cool] the overheated housing market but [it] will be gradual, not a dramatic bubble popping. A housing slowdown in turn will also rein in construction spending, purchases of new furniture and other [life] related activities.

But the good news . . . is that corporations are "flush with cash" and poised to pick up the slack.

"[T]he corporate sector will become more of the driver of the economy this year rather than the consumer. (Companies) will make more capital investments."

[C]onsumers still will spend, albeit not as freely as when they could use their houses as piggy banks.

"While the consumer might be feeling a little bit more pinched from the housing market (slowdown) and the loss of cash from that sector, we still think there will be a fairly healthy input to the economy via rising income and wages. We don't look for the consumer to basically drop dead, just (to) slow spending."

--Kim Rupert, managing director for global fixed-income analysis at consulting firm Action Economics in Hillsborough

* * *

"Many senior citizens can tell you they're living better than a couple of years ago," he said. "Seniors can now earn 3 to 4.5 percent on their retirement savings accounts -- money market accounts, Treasury bills. Interest rates on CDs have gone up a lot."

So,"[e]ven though their children are paying more on home-equity loans and their grandchildren will pay higher rates on auto loans, the grandparents will have a lot more interest on their savings."

--Jim Wilcox, a professor of finance and economics at the Haas School of Business at UC Berkeley
These people are either in deep denial or they're lulling us into complacency as our country is bought by corporations "flush with cash" and our population cannibalizes itself.

While people wonder why and how so many "illegal immigrants" managed to mobilize last week to fight for their rights, the answer is obvious. When you realize that your very existence is threatened, you have no choice but to act. But, the emphasis is on realizing that our mutual funds and our pensions won't save us because soon they too will be part of a distant past.

If Americans don't wake up now, while our roads, forests, and lives are being sold in exchange for funny money, this is going to get very ugly.

If you haven't already, now's the time to watch this interview with Aaron Russo about his new film America: From Freedom to Fascism.

And, please, spread the word before it's too late.


At Sunday, April 16, 2006, Blogger Citisucks said...

Hillarious (and yet very scary) quotes. My favorite was "still think there will be a fairly healthy input to the economy via rising income and wages". Whose income, the corporate terrorists income. I hope karma hits these banking terrorists hard and they all get what is coming to them.

I am sure we will see more and more people protesting. People having nothing left to loose. If they get arrested and have to spend a night in jail they get a free meal out of it. The corporate terrorists are just asking for a revolution and "those who make nonviolent revolution impossible, make violent revolution inevitable".


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