Since the S.&P. 500 first reached its current level, in March 2000, the mad money printers at the Federal Reserve have expanded their balance sheet sixfold (to $3.2 trillion from $500 billion). Yet during that stretch, economic output has grown by an average of 1.7 percent a year (the slowest since the Civil War); real business investment has crawled forward at only 0.8 percent per year; and the payroll job count has crept up at a negligible 0.1 percent annually. Real median family income growth has dropped 8 percent, and the number of full-time middle class jobs, 6 percent. The real net worth of the “bottom” 90 percent has dropped by one-fourth. The number of food stamp and disability aid recipients has more than doubled, to 59 million, about one in five Americans.
So the Main Street economy is failing while Washington is piling a soaring debt burden on our descendants, unable to rein in either the warfare state or the welfare state or raise the taxes needed to pay the nation’s bills. By default, the Fed has resorted to a radical, uncharted spree of money printing. But the flood of liquidity, instead of spurring banks to lend and corporations to spend, has stayed trapped in the canyons of Wall Street, where it is inflating yet another unsustainable bubble.
When it bursts, there will be no new round of bailouts like the ones the banks got in 2008. Instead, America will descend into an era of zero-sum austerity and virulent political conflict, extinguishing even today’s feeble remnants of economic growth.
http://www.youtube.com/watch?v=dsx2vdn7gpY
“They mostly come out at night, mostly.’
The folks blame it all on the Banks in Cyprus, the Banksters, the Rich are to blame is the new hue and cry. But no one blames the fact that from Turdeau’s Just Society to LBJ’s foray into socialism leftwing socialism has been bankrupting the west. But somehow the socialist governments from Turdeau forward have been expanding government like never before and have managed to lay all the blame at the feet of those they borrowed the money from to keep increasing the size of the leviathan we now call government. Ottawa now runs around 700 programs. A far far stretch from what it is constitutionally designed and intended to do. When ever Harper proposes to cut the smallest item the leftwing media and those with vested interests raise a huge cry and he backs off. Taxes in Canada have increased 1800% since 1963 to try and pay for this, the amount of laws, and rules and regulations in Canada is over 500,000 Pages of paper. This is a stack of paper over 10 stories high. The size of government is what is killing the economy. We have 3 levels of government all fighting over the one torn pocket of the citizen who pays taxes. And in Canada we only have 16M taxpayers carrying this burden. We are screwed, they can not tax their way out. Taxes already consume more of the average Canadian Family Budget than food, clothing and housing combined. It is going to collapse and soon. Read this clip on what has happened in Detroit a microcosm of The Grande Design. Socialism is a failure and it seriously hurts people and families and all countries were it is tried. There is no free lunch. http://www.thedailycrux.com/Post/32941/stansberry-detroit-s-socialist-nightmare-is-america-s-future
Read it for what it’s worth. While I believe it to be an accurate summary of the current US financial condition it puts all the blame for the economic devastation on Reagan and Bush barely touching on Obama. In fact Stockman recommends a 6 year term for him and the current senate so they have time to clean up the mess by unravelling the social security net. All I can say is LOL. Stockman should be shot with a ball of his own shit.
“Turdeau’s Just Society”
What a bunch of BS, I’m no fan of Turdeau, but that was over 30 years a ago, with a conservative majority since then. I look at things differently the west is killing Canada with this right wing clap-trap (both parties are the same).They don’t see whats going on, manufacturing is dead, you cant compete with 50 cent wages, and no environmental standards.Lowering the Taxes to zero wont bring back the jobs, and high tech fantasy, forget it. Those jobs go with the factories, we need a whole new system like dumping this fiat economy for starters. This system only benefits the top .005 percent. Get educated understand how the fiat system works and why we can never pay off the national debt or even why should in the 1st place.I see this prim-minister as the worst ever, he is a do nothing man with no plan, and the west voted him in.
Taxes already consume more of the average Canadian Family Budget than food, clothing and housing combined.
Oh, balderdash. Stats Can shows that for all Cdn families (2010 data), average income was $64,900, and taxes $8,200. However, there were government transfers of $6,500, so net income tax is only $1,700. Of course, that’s all families of 2 or more persons; if you break it down to non-senior couples without children – who get the lowest amount of gov’t transfers, $900 – the figure is average income $71,400, and taxes $10,400. Meanwhile, Stats Can also showed the average Cdn household spent 48% of after tax income on food, clothing, and housing. 48% of 61,000 is 29,000, or about 3 times what they pay in income tax. Even if this doesn’t include GST and property taxes, there’s no way your claim is accurate.
http://www.statcan.gc.ca/daily-quotidien/120618/t120618b001-eng.htm
http://www.statcan.gc.ca/daily-quotidien/120425/dq120425a-eng.htm
What a bunch of BS, I’m no fan of Turdeau, but that was over 30 years a ago, with a conservative majority since then.
What planet do you live on? From 1963 to 1984 – that’s 21 years – we had Liberal governments, with the short-lived exception of Joe Clark, who didn’t get a single substantive bill passed. Then, Mulroney for nine years, followed by another 13 years of Liberals. Total, since 1963 – 34 years of Liberals, 16 of Tories. That’s more than 2:1 Liberals, and even since 1980, it’s 17 years of Liberals and 16 of Conservatives. “Conservative majority since then”? Sheesh!
Deficit spending is simply a symptom of a mature financial system that cannot create demand because of demographics and global integration. Rather than communicate that reality and force the population to live within the means generated, the politcans continually kick the can into the future. The ‘can’ is the capacity of the western economies to continue creating debt. We now see the Euros starting their descent into a stressed statism, if they are lucky. In previous generations these ‘depressions’ caused wars or at a minimum civil unrest. I expect it will again.
IMO free enterprise will reassert its dominance in the conduct of international affairs. It most accurately reflects physical realities of geopolitics. A fundamental aspect of that reality is that someone who sells their time by the hour has that value discounted hughly in ‘tough’ times. While world affairs escape most people as they conduct their day to day lives this will be something they cannot ignore.
“Even if this doesn’t include GST and property taxes, there’s no way your claim is accurate. ”
You are leaving out the PST, Gas taxes, alcohol taxes, tobacco taxes, eco taxes, (carbon tax here in BC) license taxes (hunting license, fishing license, dog license, permits taxes Ect) all the taxes company’s pay before they sell a product to us with increased prices to pay for all those taxes and regulations, probate taxes / fees, tariffs, duties, luxury taxes (jewellery), mineral royalties, user fees / toll highways, /parks, land transfer tax, and hundreds if not more different taxes.
“, I’m no fan of Turdeau, but that was over 30 years a ago, with a conservative majority since”
Plumbing new depths of clueless stupidity, Peter on shows the world one his two brain cells has stopped working.
We’ll send Jean Cruton and his big gob henchman Warren Kimsella right over to straighten you out.
Peter and Roseuage are dippers who are a part of the great swindle, no environmental standards etc. Maybe we should be like Germany and spend 110B tax dollars to forestall AWG by 37 hrs if it even exists. Not my numbers government numbers. Harper just wrote off Billions in student debt from folks like yourselves who probably were educated at Canadian Puppy Mill Universities. Enjoy the crash you uneducated Liberal Nitwits. http://www.businessreviewcanada.ca/money_matters/canadians-pay-more-on-taxes-than-food-clothing-and-shelter-combined
Renounce the debt. Default.
Who holds the debt? People we do not like. The Chinese are cruel to Pandas, and the Japanese eat Whales. We can honor our debts held by people we like and screw the rest.
Default is the responsible, Global Warming science, thing to do.
RFB, well said, both times, and not withstanding some commenter quibbles on a detail. The thrust of your first comment is bang on. Socialists think digging the hole just a little deeper will fix the problem.
First off I’m an American, so what do I know? I moved out of my mothers house in 1970 after high school. I was 18y/o. I had a minimum wage job but could afford an apartment, utilities, a car, a house phone ( the only kind), buy food and whatever else I needed. Gas was 30 cents/gal, so I worked about 1/2 hour to fill up my car. When the shortage came in ’73 and gas doubled in price , I had to work an hour to fill up. I didn’t like it, but I didn’t think it was the end of the world. Life went on and got better. Now fast forward to 2013. An 18y/o can still move out, have an apartment, a car, pay utilities, buy food; but they also have a big TV, cable, internet, a computer, and a cell phone, usually a smart phone. I dont think they are worse off than I was. I think they are better off. The last I looked up, the USA had 39% of the wealth of the world. Europe has 31%. I dont believe it is going to zero anytime soon, unless the Four Horsemen arrive. Just a longer term perspective that old people get to have.
“17 years of Liberals and 16 of Conservatives”
How many years will it take for them to do the right thing?.
17 1700 more. The truth is they have no intention of doing the right thing ever, as they are part of the problem.They are in full support of the fiat based economy, have no problem passing bills to confiscate your wealth. Have no intention of telling their globalist masters the IMF, trilateral commission and others to go to hell.’What world do I live in its called reality, voting conservative will change nothing that’s the fantasy land.
If the wonks at the Fed reserve and congress were going to crash an economy by design they are doing a masterful job of it and all is going according to plan with very little resistance.
I’m questioning the wisdom of the Euro banksters openly treating Cyprus the way they did in such a high profile theft – a good move if your intention was to hurry economic melt down globally after wary depositors start a steady run on banks which are al over extended in risky investments.
What we have witnessed over the past 2 decades is either the most inconceivably insane self-destructive economic policy inept banking/finance can come up with, or the intent was always to collapse the economy and sell out the nation at 10 cents on the dollar to moneyed foreign interests.
Occam, the intent was to do whatever was easiesst to bribe the voters of the day with their own money. After there was no more money, political parties started bribing voters with the money of tomorrow. Never ascribt to grand conspiracies what can be fully explained by short term thinking.
This is why Peter above is wrong with his talk about trilateral commissions and the IMF. WE collectively are to blame for having voted consistently for the lazy, easy choices.
It’s an excellent article. Stockman lays blame where it belongs – statist and Keynsian hubris from all popular politicians and rent seeking as a substitute for market capitalism. Single terms (no re-election) is one of his solutions which (admittedly won’t happen) is the only way to purge the curse of permanent ruling-class politicians and their friends. The State should be feared, severely limited and disliked by all rather than a friend to some.
Stockman’s piece is an accurate assessment of the economic prospects of the US and by extension the world’s. Japan deeply injured its economy when it tried crony capitalism in the 80s. One of the things capitalism is supposed to do is weed out the speculators, rent seekers and goughers. If a firm gets bailed out when things go wrong then there is no risk. If there is no risk there can be no capitalism.
That’s where things went for a s**t with bailouts and occupiers demanding their free ride. Meanwhile, in a low inflationary environment, the rest of society has seen their purchasing power and financial security erode. Why, simply because government is less, not more efficient than people and it crowds out the private investment of people directly with their megaprojects and government “corporations'”, then indirectly through the tax system. Government/taxation is a drag on productivity, there’s no magic economic pixie dust here, it can’t by itself make us better off because it needs our wealth to exist. It’s a trade-off for non-capital items we value, though in favour of inefficiency, so we must be more careful with spending. Households could be more careful. Business could be more careful. Canada could be more careful. The US and Europe may be beyond helping themselves at this point.
Inflation awaits and Stockman is right a US state-wreck too. Unfortunately it will happen sooner rather than later as inflation finally grips their economy (and ours) will resultant higher interest rates. What we will see is the true “worst recession since the great depression” (not the recent balderdash Obama trumpets). Life will go on and all that stuff, it will just be harder.
The technocrats’ fiscal and monetary policy swoons will just make the fall even harder.
I read your link. The reporter from the Fraser Institute appears to have engaged in some creative accounting. First off, for 2010, the average Cdn family spent 48.8% of after tax income on food, shelter, clothing (FSC). Since, for all Cdn families, the figure was $64,900 for income and $8,200 for income tax, after tax income is 56,700, and the amount spent on FSC is 48.8% of that, which is 27,670. Since you don’t much tax on food, no tax on shelter, and at most HST on clothing (6.5% of total), if we assume 10% of that total is tax, we’re up to $8,200 + 2,767, or near to $11,000 in taxes. Of the remaining 56,700-27,670= 29,030, to get to a point where you’re spending more on tax than you are on FSC, the tax component of that $29k would have to be $15k, or nearly half. When I bought shoes and shirt for $22 last weekend, I hardly think that half of that was taxes. And as much as I like drinking and driving, which are easily the most heavily taxed items most non-smokers consume, I don’t come close to spending $5k a year on them, so even if they’re 80% tax, it’s still not enough to skew the whole result.
I call shenanigans.
Love Porter Stansberry’s line on black politicians; “Unfortunately, these men and women don’t understand the many negative consequences when the government moves from granting equal rights to manufacturing equal outcomes.”
Stockton California. Dominos anyone?
Look for a new banking or monitary system.
Mark of the Beast.
Well Kevin no doubt that you are probably the smartest person in Canada, and far, far smarter than all the professional economists and certified accountants that work for the Fraser Institute and that use only the Canadian Governments Financial Statements, that they do their forsenic assessments on, I do wish that you could head right off to Vancouver and show them and us all here in Canada what a good deal we really are getting. And how we should all just shut up and take our medicine. Good Grief. Everyone just put away your calculators and pencils and spreadsheets. Kevin knows better….He told me so…
the length of term is immaterial. You could change Presidents or prime ministers every month and the backroom boys would not skip a beat. The empty suit in front of the teleprompter is just that – an empty suit. The machinery that runs the party makes the decisions.
CT, shows just the opposite will happen. We have enjoyed a very brief respite from the natural state of the human condition which is serfdom. Check this out. http://www.youtube.com/watch?v=P772Eb63qIY