Well, take it for what its worth, but journalists are now back to "optimism."
This is a different breed of optimism. This is a firmer belief that the GDP is growing and that there is a firmer foot to the DOW and S&P.
We know that there is massive unemployment and more layoffs to come, and we know that the country is facing massive residential and business foreclosures from millions of people. These two huge problems, unemployment and foreclosures, are swelling the ranks of the poor. Tent cities are springing up all over the country, homelessness is increasing.
The only way to respond to the increase in investor class optimism is to recall that the markets are a leading indicator of the economy.
America is not about fairness.
Reuters: Big mood shift seen in year after Lehman
"We think we're going to see 3.0 percent economic growth in the second half of this year. As we look out into the future, I think third-quarter earnings are going to be better than expected and, based on improving economic conditions, we'll start seeing top-line growth."
3 comments:
As more and more people lose the economy game this brightens up the folks @ the Wall st.Journal? Something is very wrong with this society when economic ruin for millions spells optimism. Optimism for whom should be the ? Instead, the financial papers like the fact that even more billionaires will result from the increasing misery of this society. It' a symptom of just how mentally ill some segments of this society have become.
I think some of us were very curious to see exactly what was going to happen if the existing financial system did collapse earlier this year. What would have happened? How deeply into our society would things have broken down.
Then we go back to square one. We don't have an alternative system. The thing of it is, there are trillions of dollars invested in equities and bonds in the markets as we know. I would bet that over 65 percent of people have some kind of investment and I am pulling that number out of my backside. If say 65% of people start seeing that they are getting better numbers on their monthly statements, they start easing up on the ultra frugality.
The thing is the whole cheap credit and high debt that people got into, that bubbled the economy in the 90s and up until 2007 was bullshit. The recession wiped all of that out. The problem was it wasn't real to begin with. It was not wealth creation but debt shifting like a shell game.
The problem is we are not reading that things are changing. Obama is weak on standing up to the big boys. There's a reason for this though. The big boys can shift money around and make Obama look like a complete weasel with the economy. He's in a tight spot. Chomsky writes about this all the time. Who controls what and what exactly can a president do who wants to shift wealth over to the ordinary stiff. He can't do much at all. He can do some things but not really much.
We are at the mercy of the elite. I don't know how we get out of it. People have tried to figure this out for a long time now. The best thing I come up with is that we have to live elegantly and at peace with ourselves.
I would assume that a lot of the run up in equities is the usual suspects. Oil is up around $70, I'm noticing that a company like Precision Cast Parts which is a weapons manufacturer is doing better. Shipping is up because China is sending crapola all over the world. High tech is doing better and that is also connected with military spending. Big Pharma is fine, Wal Mart is fine. Real estate is way off.
I suspect that a lot of the equities run is basically happening because the government is, and as it always does, spending huge sums on the military. Also banks are closing ranks and tightening the purses, plus they already control lots of wealth.
I think we agree, the elite have decided that millions more can join the ranks of the poor and they, the elite, will be just fine. The economy has enough gas in it to support them with this big shift.
I wish I knew the answer.
Poverty gives them more power. Poor people are harmless, they basically just shoot and rob each other. The wealthy can afford private security firms to keep an eye on their walled compounds. Just like the good old days when the Lords had knights do the job. Hey the guards even wear armor like back then and have much better weapons.
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