GDP is up? WHAT?

[cashmcall]

National GDP came out last week at 2.84%. That was certainly a beat of the expected 2.5%.

The numbers once again proved that nutters like me- are wrong, didn't they? Our economy is excellent and the stock market is fairly priced near 16,000. The Twitter IPO with virtually no earnings is worth 35 bucks a share, right?

Enter the Greater Fool Theory. There must always be a greater fool than you who will buy Twitter at 45- so that you can profit at 35. That fool in turn must need someone willing to pay 55.

GDP numbers have always been cooked and inflated with the use of inventory. Most of us know that and when the 2.84 print came out I was a little shocked. At first I was puzzled, because everything I am seeing and reading does not support that kind of number. Then it hit me. The latest government manipulation- thanks to this commenter.

The BEA's GDP tables tell us that the gross change in GDP from 2Q -> 3Q was $196.6 billion. But the Fed's QE program injected $255 billion, so in fact the economyshrank during the 3rd quarter.

And then I remembered the government's latest charade announced last summer that most of us forgot about.

They re-configured GDP "intangibles" all the way back to 1929. That way they could manipulate and boost GDP figures with such things as film royalties, research and development, and garage sales. They literally positioned themselves to manipulate the data with items that do exist but that nobody has a firm way of counting and never has- thus the term "intangibles."

Here's a link. http://www.ft.com/intl/cms/s/0/52d23fa6-aa98-11e2-bc0d-00144feabdc0.html#axzz2jwd2twHW

When you change the measuring rules- such as the input numbers- you are nearing the end. It is the last gasp of a power structure that is willing to try any trick imaginable to retain power. In this case, manipulating this nation's last bastion of wealth- retirement assets and ultimately destroying them- at the same time picking our pockets with a newer, giant, healthcare bill that they are willing to punish you for if you do not buy it.

All of that greased with fraudulent inflation, employment, and GDP figures. Of course it's a sham but then again- what else would you expect from our government masters?

All of this is going to come together in 2014. Get ready. The stock market's blow off top is here and not one responsible person has received an Obamacare bill or sent in an Obamacare check yet.

All of this as the middle classes' income shrinks monthly. This is gonna be good.

We are near the end. I will give this faux economy one more year subject to change if the government pulls anymore of it's tricks.

Remember my advise may be worth less than your paying for it..

 

[Dr.Who]

I have zero doubt that the numbers have been manipulated.

I do not think that QE is at all effective enough to be any part of those numbers. After all the money they are "injecting" stays in the banks they give it to and does not make it into the general population.

 

[dogtowner]

I have zero doubt that the numbers have been manipulated.

I do not think that QE is at all effective enough to be any part of those numbers. After all the money they are "injecting" stays in the banks they give it to and does not make it into the general population.

No it does not go to the general public. It goes to those who borrow creap money to putnin the stock market. Ergo the assention of the dow and dirth of and real growth. Sugar high for the favored few.

 

[cashmcall]

No it does not go to the general public. It goes to those who borrow creap money to putnin the stock market. Ergo the assention of the dow and dirth of and real growth. Sugar high for the favored few.

Ditto..

 

[cashmcall]

I have zero doubt that the numbers have been manipulated.

I do not think that QE is at all effective enough to be any part of those numbers. After all the money they are "injecting" stays in the banks they give it to and does not make it into the general population.

I would like you to consider a couple of things that are going on concurrently. I can offer references if you need validation.

Each year, our government spends 1.2 trillion dollars a year that it doesn't have. They call this deficit spending. In addition, the FED was buying 85 billion dollars per month both in mortgages and treasuries. When we add the 1.2 trillion of debt we add each year with the 1.1 trillion of funny money that the FED uses to print and buy mortgages and treasuries...

Our government is adding 2.3 trillion dollars per year in spending and debt- money that does not exist. Money that flows into fraudulent GDP figures as all of that government spending cooks the books.

All of that make believe money has to go somewhere. Right now, the only game in town is the stock market. The FED and it's member sycophants have ruined every other asset class as bankers, hedge funds, retirement fund managers and anyone else who relies on returns and yield are getting funneled into the investment of last resort. Ben Bernanke's POMO fueled, inflated stock market which is getting very close to completely bursting. This is just my opinion..

What the FED has done for the past 5 years is UNPRECEDENTED in the U.S. Nobody really knows how monetizing the debt and printing trillions will turn out. Most of us think it will eventually lead to hyper inflation.

Ever hear of Hauser's Law?

Hauser's Law is a historic figure that has remained static for about 75 yeras or since WWII. Essentially, Hauser's Law states that tax revenue averages 19.5% of GDP no matter what. Historically speaking if GDP were 15 trillion, then the US would take in just a shade less than 3 trillion in tax revenue. http://en.wikipedia.org/wiki/Hauser's_law

In other words, Hauser's Law is a cap. No matter what our government does- no matter who it targets or how much it raises or lowers tax rates- all the government can grab is about 19.5%.

So what does that mean?

It means...it's a dead man's party. We're broke and pretending not to be. Our liabilities far exceed our assets. We cannot EVER raise enough money to pay what we owe. We cannot tax away that 17 trillion (and hats just a small part of it) we owe when the absolute most we can tax each year is about 19.5% (this year the CBO says taxes will hit an all time record of 2.7 trillion) and yet we will spend 3.5 trillion this year alone- thus adding another 800 billion to that massive 17trillion dllar debt that we cannot possibly pay.

All debt is paid. Either by the lender or by the borrower.

Therefore, it is mathematically impossible to tax ourselves out of this mess. It can't be done. Hyper-inflate debt away, default, or extend the dead man's party just as long as we can. Those are the choices. Right now- it's the dead man's party with Ben Bernanke supplying the punch. I don't see that as good or bad- labels that actually don't really matter. I just see those things as the potential outcomes and I have positioned myself accordingly.

 

[Dr.Who]

I would like you to consider a couple of things that are going on concurrently. I can offer references if you need validation.

Each year, our government spends 1.2 trillion dollars a year that it doesn't have. They call this deficit spending. In addition, the FED was buying 85 billion dollars per month both in mortgages and treasuries. When we add the 1.2 trillion of debt we add each year with the 1.1 trillion of funny money that the FED uses to print and buy mortgages and treasuries...

Our government is adding 2.3 trillion dollars per year in spending and debt- money that does not exist. Money that flows into fraudulent GDP figures as all of that government spending cooks the books.

All of that make believe money has to go somewhere. Right now, the only game in town is the stock market. The FED and it's member sycophants have ruined every other asset class as bankers, hedge funds, retirement fund managers and anyone else who relies on returns and yield are getting funneled into the investment of last resort. Ben Bernanke's POMO fueled, inflated stock market which is getting very close to completely bursting. This is just my opinion..

What the FED has done for the past 5 years is UNPRECEDENTED in the U.S. Nobody really knows how monetizing the debt and printing trillions will turn out. Most of us think it will eventually lead to hyper inflation.

Ever hear of Hauser's Law?

Hauser's Law is a historic figure that has remained static for about 75 yeras or since WWII. Essentially, Hauser's Law states that tax revenue averages 19.5% of GDP no matter what. Historically speaking if GDP were 15 trillion, then the US would take in just a shade less than 3 trillion in tax revenue. http://en.wikipedia.org/wiki/Hauser's_law

In other words, Hauser's Law is a cap. No matter what our government does- no matter who it targets or how much it raises or lowers tax rates- all the government can grab is about 19.5%.

So what does that mean?

It means...it's a dead man's party. We're broke and pretending not to be. Our liabilities far exceed our assets. We cannot EVER raise enough money to pay what we owe. We cannot tax away that 17 trillion (and hats just a small part of it) we owe when the absolute most we can tax each year is about 19.5% (this year the CBO says taxes will hit an all time record of 2.7 trillion) and yet we will spend 3.5 trillion this year alone- thus adding another 800 billion to that massive 17trillion dllar debt that we cannot possibly pay.

All debt is paid. Either by the lender or by the borrower.

Therefore, it is mathematically impossible to tax ourselves out of this mess. It can't be done. Hyper-inflate debt away, default, or extend the dead man's party just as long as we can. Those are the choices. Right now- it's the dead man's party with Ben Bernanke supplying the punch. I don't see that as good or bad- labels that actually don't really matter. I just see those things as the potential outcomes and I have positioned myself accordingly.

Do I need to see references? Absolutely not since just about everything you said is or should be common knowledge. The ONLY slight thing that might not be true (other than maybe the actual numbers and not so significant details) is that "most" see it leading to hyperinflation. Surely many are worried about that I doubt most would make that prediction. I really really hope not. But it has been on my radar and it is one reason I am investing in silver. And If my silver never pays off then I will give it out as tips when I go to restaurants.

 

[Cruella]

I read a report yesterday, that every full time worked averages paying $30k a year in taxes. If there are two full time workers in a family that's $60k.
$10k a year is the average income tax for every person in the country, although 2/3 of the country either don't work, or only work part time.

 

[cashmcall]

I read a report yesterday, that every full time worked averages paying $30k a year in taxes. If there are two full time workers in a family that's $60k.
$10k a year is the average income tax for every person in the country, although 2/3 of the country either don't work, or only work part time.

Scary isn't it....

 

[cashmcall]

Do I need to see references? Absolutely not since just about everything you said is or should be common knowledge. The ONLY slight thing that might not be true (other than maybe the actual numbers and not so significant details) is that "most" see it leading to hyperinflation. Surely many are worried about that I doubt most would make that prediction. I really really hope not. But it has been on my radar and it is one reason I am investing in silver. And If my silver never pays off then I will give it out as tips when I go to restaurants.

I think siver is a pretty good bet.. I never thought about using it as tips or gifts..