Professing Themselves To Be Wise, Liberal Democrats Became FOOLS

Today the DOW Industrial Average reached a milestone: it closed at over 20,000 points for the very first time in history.

Obama’s team of Federal Reserve officials decided to finally begin raising interest rates for the first time, citing “a strengthening economy.”

But please, allow me to provide you with a reminder of what Paul Krugman predicted the night that Donald Trump won.

Paul Krugman was given a Nobel Prize in economics – not for having any damn clue whatsoever about economics or markets or business or anything close to any of these, but for being a devout leftist who espoused progressive liberalism regardless of how insane progressive liberalism is or how many times it has failed.

Here is what the smartest, wisest leftist economist on planet earth actually knows about the economy:

Paul Krugman: The Economic Fallout
By Paul Krugman
November 9, 2016 12:42 AM ET

It really does now look like President Donald J. Trump, and markets are plunging. When might we expect them to recover?

Frankly, I find it hard to care much, even though this is my specialty. The disaster for America and the world has so many aspects that the economic ramifications are way down my list of things to fear.

Still, I guess people want an answer: If the question is when markets will recover, a first-pass answer is never.

Under any circumstances, putting an irresponsible, ignorant man who takes his advice from all the wrong people in charge of the nation with the world’s most important economy would be very bad news. What makes it especially bad right now, however, is the fundamentally fragile state much of the world is still in, eight years after the great financial crisis.

It’s true that we’ve been adding jobs at a pretty good pace and are quite close to full employment. But we’ve been doing O.K. only thanks to extremely low interest rates. There’s nothing wrong with that per se. But what if something bad happens and the economy needs a boost? The Fed and its counterparts abroad basically have very little room for further rate cuts, and therefore very little ability to respond to adverse events.

Now comes the mother of all adverse effects — and what it brings with it is a regime that will be ignorant of economic policy and hostile to any effort to make it work. Effective fiscal support for the Fed? Not a chance. In fact, you can bet that the Fed will lose its independence, and be bullied by cranks.

So we are very probably looking at a global recession, with no end in sight. I suppose we could get lucky somehow. But on economics, as on everything else, a terrible thing has just happened.

For a few hours following the election as unhinged progressive liberals sold off everything as they dizzily raced circles around their houses hysterically screaming, “The sky is falling!  The sky is falling!”, Krugman was probably a very happy camper in his predictive prowess:

Futures markets imploded Tuesday night as soon as it became apparent Trump was likely to win. At their nadir, futures for the Dow Jones Industrial Average had dropped 750 points.

But that didn’t last very long, as progressive liberals do not “reality” make:

Krugman’s forecast that the markets would “never” recover took just nine hours to be proven totally wrong. Come Wednesday morning, the fever had almost entirely broken in the U.S. Instead of dropping by 10 percent or more, as some predicted, the Dow, Nasdaq, and S&P 500 all rose by more than a percent. Later in the day, the Dow briefly surged above its all-time closing high, before ending the day just a few points below it. The Dow finished the day up about 257 points overall.

And yes, we just reached a brand new milestone as investors and businesses waited to see whether Donald Trump would actually do what he promised he would do.  And today, as he unleashed a sweeping series of executive orders undoing years of demonic stupidity, the clouds opened and the floodgates of confidence in the bedrock for a sound economy were unleashed.

Check out what happened:

Note that what carried the day was MANUFACTURING stocks.  Because to be a “Democrat” means to be at total war with blue-collar jobs and basically jobs in general.

Donald Trump declares that he is going to bring back American manufacturing from the dead that Barack Obama and the Democratic Party tried to destroy in their economic holocaust.  And investors who understand how business works believe that what Trump is saying will work.

What they DON’T believe is that a fool who was given a Nobel Prize because he’s like one of Hitler’s generals who believed the psychotic delusions of his Führer no matter how insane his demonic strategies clearly were.

Businesses and investors are reacting after Donald Trump began to put into motion the very things that the left is the very most BUTTHURT about, such as an executive order to begin building the wall; such as his executive order to direct his Cabinet to find ways to deny federal funds to states that allow sanctuary cities; such as an executive order to enact his “extreme vetting” of immigrants streaming in from terrorist-ridden countries.  They wanted to see if he would follow through on what he said he was going to do.  And they have decided – to the demonic butthurt of Democrats – that yeah, he WILL follow through with what he said he would do.

These things, recall, were predicted to bring about our very certain doom.

Paul Krugman is like the leftist climatologist who idiotically believes he or she can tell you that “anthropomorphic climate change” is a fact – even though the dumbass idiot can’t get two consecutive weather forecasts correct.  I live in the Palm Springs area where there is a mountain in the path of most of the incoming weather systems: I can’t TELL you how many times I’ve looked at the weather forecast which called for rain and there WAS no rain or which called for no rain and there WAS rain.  I have clicked on the forecast and seen it say 0% chance of precipitation – AS IT WAS RAINING!!!  Such people literally cannot tell you if it’s raining right now, but they can assure you with ontological certitude that they comprehend the cosmic totality of everything “climate.”

Point: you have to be the most arrogant fool in the world to be a progressive liberal.

Paul Krugman is mainstream journalism at its very finest and its very most intellectual and its very most objective.

For the record, I wrote my own piece on election night and published it about the exact same time Krugman posted his drivel.  Here’s how I began what I said as I began to write shortly after midnight after the election:

President Trump. And Laughing Maniacally While Watching Totally Wrong Pseudo-Intellectual Butthurt Fools At MSNBC WHINE About It

November 9, 2016

Well, I finally deliberately turned the channel to MSNBC.  Which truly is a first.

Why would I waste my time, you ask?  Well, because I knew that they would be doing EXACTLY what they did and for once it struck me that their fool idiot blathering would be entertaining knowing that they just suffered the end of their world as their bubble-world popped.

Of course, had I watched this pathetic network over the last few months, I would have heard non-stop confident predictions from these wrongheaded frauds, and the only argument from the monolithic Stalinist channel would have been how big a majority Hillary Clinton would win by.

I mean, I was watching the talking heads on MSNBC for like five minutes, and they were reading selected quotes from their handpicked foreign leaders whose opinion means so much to them and predicted foreign policy disaster; they looked at the foreign markets and the futures market and predicted economic doom; they predicted war and defeat; they even mentioned Trump would squeeze the trigger of the nuclear arsenal and end all life on earth.  It was amazing.  Chicken Little says the sky is falling; he was melodramatic by comparison to the hysterical “professionals” at MSNBC.

I never thought in my entire life I would watch a conversation where CHRIS MATTHEWS would actually be “the voice of reason.”

Just realize that these people have been wrong every single time they have ever opened their mouths and some kind of noise came out.

Barack Obama’s entire presidential legacy will soon be flushed down the toilet like the disgusting lump of poop that it always was.  And his worshipers are putting on their sackcloth and casting ashes upon their heads.  This is the kind of thing that has all the hallmarks of comedic GOLD.

[…]

Where the hell is MY Nobel Prize?

Hell, I ought to receive a Novel Prize for mocking insane fools like Paul Krugman.  I didn’t know that the moron was writing his own piece while I was writing mine, or I would have cited it the same way I cited what I had just watched coming from MSNBC.

But of course I’m not a progressive liberal, so I’m not utterly disconnected from reality.  I KNOW the fool powers that be possessed by Beelzebub as they are would NEVER give me or any conservative anything but scorn and derision and contempt and hate no matter how right we are and no matter how pathologically damnfool wrong they are.

Congratulations, America, You Got What You Voted For: Soaring Unemployment, A Crashing DOW. Next Comes The Beast (You’ll Be Worshiping Him Soon)

As I noted, the day following the re-coronation of Obama as the Pharaoh in Chief saw the DOW plunge to historically high levels as investors and businesses pretty much said, “To hell with it.”

The 313 point plunge in the DOW on November 7, 2012 was the second worst point-drop in history following a presidential election and tied for fourth in American history in terms of overall drop in value.  Obama actually set the record for both categories when he was elected in 2008: the day of November 5, 2008 that followed the news that Obama would have his first four years to destroy the American economy was greeted with an almost 500-point drop or a 5% decrease in the value of the DOW.  And November 7th’s DOW drop puts the kibosh on any assertion that November 5 of 2008 was somehow a fluke.  So let’s say it with enthusiasm: “you’re #1, Obama!  No one but no one can destroy an economy like you!”

In both cases, it was the economy saying that a president like Barack Obama who would declare war on jobs, on productivity, and pretty much on anything that makes America great, is akin to a judgment of doom for this nation.

Since Obama was reelected, investors and business have decided that the economy and job-creation will take a four-year vacation.  The DOW has taken a nearly 700-point plunge since Obama was reelected as of today.

I know, I know, liberal.  Those vile rich people should all die and their flesh should be ground up for food after all the wealth they worked so hard to build for themselves and for their children has been confiscated and redistributed.

Here’s the thing: jobs are going the way of the Dodo bird and rich people in America.  Because people who voted for Obama don’t want jobs; they want socialism and communist redistribution of other people’s money.

The Lonely Conservative – and dang, I’m feeling kind of lonely since last week too, I’ve got to admit – posted these little factoids about Obama and the job boom that will now clearly never happen:

Initial Jobless Claims Soar To 439,000 – Updated
November 15, 2012
By Lonely Conservative

Isn’t it interesting that the jobless claims reported in the weeks leading up to the election were so low, and now that the election is behind us we get a report like this one? Of course, it was all unexpected to economists, who didn’t see the whopping 439,000 coming. Naturally, MarketWatch is doing their duty and blaming it on Sandy. You know, because it couldn’t have anything to do with the massive layoffs due to Obamacare.

The damage caused by Hurricane Sandy sent U.S. jobless claims soaring by 78,000 in the week ended Nov. 10 to an 18-month high of 439,000, according to the latest government figures. A Labor Department official on Thursday said claims surged in the eastern parts of the country that laid in the path of the storm. The destruction of job sites, closure of government offices and widespread power outages caused more people to file claims after an initial delay. Economists surveyed by MarketWatch had expected claims to climb to 380,000 on a seasonally adjusted basis. Initial claims from two weeks ago were revised up to 361,000 from an original reading of 355,000, based on more complete data collected at the state level. (Read More)

Good grief, when they revise this number what will it go up to?

If that’s not bad enough, have you seen how the stock market has been doing since the election?

Ever since Obama won eight days ago, stock prices are down about 4% as this is being recorded. So stocks peaked September 14—two months before the election—when the Federal Reserve announced the current version of quantitative easing, and stocks held up pretty much right through an election day rally.

But now that the election is over stocks are dropping with no bottom in sight. This is no accident given investors’ fears of higher taxes and continued big spending, including higher taxes on capital gains, which inevitably will tank the economy. In fact, I believe we are headed for a recession. (Read More)

Well, it’s not like people weren’t warned. If you’re an Obama voter and having second thoughts, you might want to re-think where you get your news in the future.

Update: Zero Hedge is a good place to get economic news, like this:

The latest initial claims data posted a multi-year high 104,548 surge in weekly NSA claims from 361,800 to 466,348, and even the Seasonally adjusted number soaring from 361K to 439K on expectations of a 375K print. In other words, a complete disaster for any economic data bulls. What is truly amusing is that the same Wall Street “experts” who set expectations were unable to foresee the Sandy effect that every “macrotourist” on Twitter apparently is so very aware of. Also, it is apparently also “Sandy’s fault” (now that the Bush excuse is back in retirement) that the prior week’s claims were revised from 355K to 361K. Basically, just as we said 3 weeks ago, ignore every negative data point: it is Sandy’s fault. However, for the snapback, when there actually is good news to be had, well, “four more years.” Finally, to all the Sandy apologists: is the logic here that: if Hurricane, then Fire everyone? Because that is what is implied… (Read More)

Update 2: Oh look – The Euro Zone is in another recession, so jobless claims can be blamed on that!

Update 3: The states with the highest number of new jobless claims were Ohio and Pennsylvania. Go figure.

That 439,000 new jobless filing is the worst since April of 2011.

“Forward” is a great slogan and everything, but the only way Obama is going to take America “forward” is to drive us off the fiscal cliff that was his bright idea to create in the first place (and see here for more because Obama set this disaster up from the very start).  The fact of the matter is that it is a documented fact by one of the great journalists in American history that the idea for sequestration – i.e. the “fiscal cliff” or “taxmageddon” – came from Obama’s chief of staff Jack Lew and Rob Nabors (Obama’s White House Assistant to the President and head of the White House’s Office of Legislative Affairs).  The money quote:

“At 2:30 p.m. Lew and Nabors went to the Senate to meet with Reid and his chief of staff, David Krone. ‘We have an idea for the trigger,’ Lew said. ‘What’s the idea?’ Reid asked skeptically. ‘Sequestration.’ Reid bent down and put his head between his knees, almost as if he were going to throw up or was having a heart attack. He sat back up and looked at the ceiling. ‘A couple of weeks ago,’ he said, ‘my staff said to me that there is one more possible’ enforcement mechanism: sequestration. He said he told them, ‘Get the hell out of here. That’s insane. The White House surely will come up with a plan that will save the day. And you come to me with sequestration?’ Well, it could work, Lew and Nabors explained. What would the impact be? They would design it so that half the threatened cuts would be from the Defense Department. ‘I like that,’ Reid said. ‘That’s good. It doesn’t touch Medicaid or Medicare, does it?’ It actually does touch Medicare, they replied. ‘How does it touch Medicare?’ It depends, they said. There’s versions with 2 percent cuts, and there’s versions with 4 percent cuts.” (Bob Woodward, The Price Of Politics, 2012, pp. 326)

So anybody who wants to assert that sequestration originated ANYWHERE other than the Obama White House is a documented liar.  Not that liberals care about being documented liars.

Let me explain to you how Obama will use the sequestration monster that he created in terms of a cartoon analogy: the mad scientist builds a giant indestructible killer robot that he threatens to turn loose on America unless the nation bow down before him and do whatever he wants.  Unfortunately, in the cartoons super heroes show up to defeat the giant killer robot and save the day, and all we’ve got as heroes now is a House filled with mostly shocked and awed Republicans.

Obama is threatening to use the vicious, economy murdering monster that he built (without ever actually bothering to acknowledge that HE was the one who built it, fwiw) to bring down America unless he gets the war on the rich that he so desperately wants as a true ideological Marxist.

It doesn’t matter to the American people that Obama invented sequestration.  It doesn’t matter that sequestration will result in shockingly high unemployment and recession.  It doesn’t matter that Obama is and has been saying all along he would plunge America into joblessness and serious recession unless his demands to directly attack job creators and investors are not met.  It doesn’t matter that when America needed to be saved from sequestration, Obama was swearing he would veto any bill that tried to save the nation from his monster.  All that matter is that Obama will be depicted by the mainstream media as the good guy and the hero and that the Republicans will be portrayed as the villains who somehow caused all this mess (because we’re not going to remember that Obama actually caused it).

This is a country that just boldly declared that it truly deserves to suffer.  And it is going to get the true suffering that it so boldly deserves.

If you believe that businesses and investors think that Obama will be anything other than an unmitigated disaster for America, and that in cutting their own losses they will cut the thread that our economy is hanging upon, you are insane.  There is absolutely no question that Obama-believers are morally insane, but you can add clinically “disassociated from reality” to the list.

Under Obama, America dropped from first place to seventh place after losing ground every single year of his presidency.  Not that that matters one wit to liberals, of course.

The Obama presidency will leave an America that is “worse tasting, smaller-sized and higher priced.”

We’ve already seen unparalleled “messiah-worship” of an American president in Obama: we’ve seen the man literally place his image on the flag because he thinks HE is America and the only thing that America should love.  We’ve seen the Obama campaign team refer to Obama as “Black Jesus” to kick out Christ and replace the King of kings and Lord of lords with Obama.  And yes, we’ve seen the enthusiastic determination of Democrats to replace Jesus with their REAL messiah, Obama.

Obama is Just Like Jesus, says his wife.  There’s no such thing as “us and them”.  Red and yellow, black and white, all are precious in Obama’s sight.  The sheer worship is absolutely astonishing.

The Democrat Party under Obama is the Party that kicked God out of its platform before hastily deciding to put Him back in to a loud chorus of boos from the Party that Shakes Its Fist At God (see also here).

The Democrat Party under Obama or pretty damn much everybody else is the Party of Holocaust with 55 million innocent human beings butchered in a manner that I would not want to put an insect through.  One day every single Democrat will stand before the Father while flames of wrath billow out from His Throne and give an answer for why they supported the ugliest mass murder of human life in all of history.

The Democrat Party under Obama is a Party that worships homosexuality and sodomy.  And as much as they worship sodomy and homosexuality, they hate God, they hate the Bible, they hate Judeo-Christianity, they hate Western Civilization, and they viscerally hate and despise the name of Jesus.

And America has been paying for its support of this party for the past six years.  Because when America decided that demagogic Democrats Nancy Pelosi and Harry Reid should run the House and the Senate back in 2006, unemployment was 4.4%.

And of course Democrats were bitching up a storm at that unemployment rate and swearing up and down that they could do better.  And instead they led America “forward.”

“Forward” to the Antichrist and the mark of the beast.

According to the Bible, the coming Antichrist will be worshiped as God.  Let me ask you, how does that happen?

Prior to the coming of the Antichrist, America and the rest of the world will experience a financial collapse the likes of which the world has never before seen.  The world will suddenly find itself awash in wars and famines and mass deaths.  Things will be looking grim beyond belief.

And then suddenly, as if riding in on a white horse to save the day, will come the figure that the Bible has described as “the beast.”

We are watching that collapse building and growing and metastasizing.  And when we voted for Obama, we voted for the collapse and for the beast who would come because of that collapse.

And the same people who voted for Obama are the same sorry already-doomed fools who will worship the beast and enthusiastically take his mark on their right hands or on their foreheads.  Because the mark of the beast will be nothing more than the ultimate, big government, liberal economic plan.  It will represent everything that the Democrat Party – and for that matter the Communist Party – has been building toward for the last eighty years.

It wasn’t merely Obama who will have murdered America – although Obama will ultimately be the poster boy for the murder and downfall and collapse of America.  No, this was a process began by Democrats and initiated and implemented under FDR in 1932 with Social Security.

The real “national debt” that will bankrupt America isn’t the $16 trillion that Obama is responsible for 60% of in only four misbegotten years as our Pharaoh; it’s $222 trillion, and in fact $224.75 trillion given the fact that that report of $222 trillion is a few months old now.

You need to understand that the Obama regime is “the Cloward and Piven presidency.”  And you need to understand why Democrats are so relentlessly pushing for a complete collapse of the United States of America.  As I wrote back in 2009:

The only question, given the massive debts Obama has already accumulated – deficits that literally are more than every president has accumulated from George Washington to George W. Bush, combined – is whether the Cloward-Piven strategy will yet have its chance to work.  It might already be too late.  When you look at our real national debt of more than $100 TRILLION and realize that we cannot possibly repay it, if you have any sense you should get more than a little bit concerned that our leaders simply WILL NOT control their spending.

The Democrats have an endgame: when the system collapses, the panicked people will turn to the very government that created the calamity and demand that it take care of them.  And that is precisely what big government liberals have always preached.

Notice that we went from talking about debt of “more than $100 trillion” to “more than $222 trillion” since then.  But also notice that there’s an endgame in mind: when America collapses, a desperate people who already demonstrated to all time and eternity that they are a) stupid and b) depraved will demand that the government step in to help them.  And bingo, you’ve got the communist state that Democrats have dreamed of since liberals forced LBJ to quit trying to fight communism so they could join the communists.

Democrats like Obama are hoping for a complete American collapse because they believe they can steer it in the direction they desire.  And of course, under the leadership of the Antichrist, that question will be answered with the words, “Yes we can!”

Obama Gives America One Of Worst Post-Presidential Market Plunges In History As Businesses And Investors Say Sayonara To Economic Growth, Jobs

Businesses and investors told America what they thought of their idiotic choice for president yesterday with the biggest market plunge in a year the day after Obama was reelected.

The Dow dropped 313 points, or 2.4% of its total value on the trading day immediately following the Obama reelection.

Interestingly, Obama has two of the five worst market plunges on the day after a presidential election, and you’ve got to go back to the 1930s and 1940s to see worse market disasters:

Other post-election plunges in the stock market
Posted: Nov 07, 2012 2:35 PM PST Updated: Nov 07, 2012 2:35 PM PST
By The Associated Press

The Dow Jones industrial average fell 2.4 percent, giving it its fifth worst one-day drop following a U.S. presidential election. The biggest, in 2008, came in the midst of the financial crisis on the day after President Barack Obama won his first term. Here are the worst five one-day post-election drops since 1900, according to Bespoke Investment Group:

Election Day: Nov. 4, 2008.

Winner: Barack Obama.

One-day loss in the Dow Jones industrial average: 5 percent.

Election Day: Nov. 8, 1932.

Winner: Franklin Delano Roosevelt.

One-day loss in the Dow Jones industrial average: 4.5 percent.

Election Day: Nov. 2, 1948

Winner: Harry Truman

One-day loss in the Dow Jones industrial average: 3.8 percent.

Election Day: Nov. 5. 1940

Winner: Franklin Delano Roosevelt.

One-day loss in the Dow Jones industrial average: 2.4 percent.

Election Day:

Winner: Barack Obama.

One-day loss in the Dow Jones industrial average: 2.4 percent.

Notice that all five of these turd presidents whom the market rejected were Democrats.  And notice that the only OTHER winner of two “Turd of the Year Awards for Market Disaster” was the guy who kept America in the Great Depression.  You would have thought that America would have learned from the LAST time we got Obama and the market collapsed the most in presidential election history.  Oh, well.  Why not just blame this time on Bush, too?

I don’t know.  Maybe my schadenfreude slip is showing, and maybe I just don’t give a flying damn what happens given that I know Obama will plunge America into the worst economic disaster in the country’s history and figure it might as well happen sooner rather than later.  That and the fact that, given that America voted to collapse in voting for Obama, we might as well get what we actually voted for.  I mean, we sure as hell didn’t get what we voted for the LAST time we voted for “Mister hope and change,” did we?  Rather, we got four years of blame and excuses, which doesn’t even kind of sound like hope and change.

If liberal ideologue MSNBC moron Chris Matthews can be glad Hurricane Sandy hit America so Obama could win, well, I suppose I can pretty much be happy for damn near any disaster and liberals can’t bitch without being hypocrites.  Mind you, that won’t stop them from bitching at me BECAUSE THEY ARE HYPOCRITES.

A lot of your more stupid Americans are still blaming Bush for the terrible economy while exonerating Obama, according to exit poll data.  Don’t worry if you think that trend can’t possibly continue: because those people will be just as stupid in four years when they’ll STILL be blaming Bush for the bad economy as they are now.  Apparently Bush is to stupid people what Bogeyman is to naive children.

The beast is coming after the economy completely collapses.  I really want to make sure everybody knows that.

In other news the deadline for America to fall off the fiscal cliff that Obama set up for us is January 1, 2013.

It gives me great comfort to know that I’ll be singing praises to the name of Jesus Christ in heaven before very much longer.  And it frankly bothers me very little that on that day liberals on earth will be simultaneously cursing the day they ever heard the name of Barack Hussein Obama.

Market Responds To Obama’s $447 Billion Not-Stimulus Stimulus By Tanking 304 Points

Even the überleftist in-the-tank New York Slimes was forced to report that:

A speech by President Obama on jobs did little to lift the malaise because of uncertainty over whether the program would help the recovery, analysts said.

Hey, thanks for a great big giant load of verbal fecal matter, Obama.

Here’s the foul-smelling “fruits” of Obama’s speech:

Thanks Barack… Stock Market Tanks After Obama’s $447 Billion Stimulus Speech
Posted by Jim Hoft on Friday, September 9, 2011, 9:00 AM

Last night Barack Obama announced his latest spending plan to “revive the economy” would cost another $447 billion.

Today the markets tanked.

The Dow was down 172 points shortly after opening.

The Street reported:

In his speech last night to Congress, the President detailed a $447 billion stimulus package aimed at spurring job creation, a much more ambitious proposal than the $300 billion plan expected. It remains up in the air, however, which parts of Obama’s proposal would be able to pass Congress. Republicans are expected to show their support for the $253 billion in tax cuts but will likely oppose the payroll tax holiday component of Obama’s strategy.

Investors have been particularly uneasy as they await possible monetary and fiscal stimulus to jumpstart the sluggish economy. Federal Reserve chairman Ben Bernanke left the door open on a possible Fed stimulus in his speech Thursday, essentially leaving the market hanging for another two weeks before the next Fed meeting on Sept. 21. Meanwhile, any jobs proposal from Washington is not expected to pass until later this year, leaving the dismal U.S. jobs market staggering without help.

And if finished down 304 points for the day.

Keep talking, Obama, and the presidential limo is going to be on concrete blocks without any wheels in the midst of a Washington D.C. in flames as the symbol of the “hope and change” that Obama represents.

This is what a completely failed presidency looks like.

On The June/August Market ‘Correction’, Obama And QE2

There was all kinds of questions and all kinds of answers regarding why the market has been crashing since July 21:

Dow falls 512 in steepest decline since 2008 crisis

NEW YORK (AP) — Gripped by fear of another recession, the financial markets suffered their worst day Thursday since the crisis of 2008. The Dow Jones industrial average fell more than 500 points, its ninth-steepest decline ever.

The sell-off wiped out the Dow’s gains for 2011. It put the Dow and broader stock indexes into what investors call a correction — down 10 percent from the highs of this spring.

The day was reminiscent of the wild swings that defined the markets during the crisis three years ago. Gold prices briefly hit a record high, oil fell an extraordinary $5 a barrel, and frightened investors were so desperate to get into some government bonds that they were willing to accept almost no return on their money.

It was the most alarming day yet in the almost uninterrupted selling that has swept Wall Street for two weeks. Since July 21, the Dow has lost more than 1,300 points, or 10.5 percent of its value. It has closed lower nine of the 10 trading days since then.

For the day, the Dow closed down 512.76 points, at 11,383.68. It was the steepest point decline since Dec. 1, 2008.

The “10% decline” is the tipping point that defines a “market correction.”

But what is being “corrected”?  The term “correction” implies that something was wrong that needed to be corrected.

Most of what I heard yesterday had to do with the ongoing fiscal crisis in the European Union, with the P.I.I.G.S. – Portugal, Ireland, Italy, Greece and Spain –  just getting uglier and uglier.

Greece was bad enough.  But now Italy is going into the crapper, and Italy is just “too big to bail,” to play off the phrase “too big to fail” that “justified” so many of the recent unprecedented bailouts.

I don’t doubt that the deteriorating situation in Europe is part of the crisis that is causing the gigantic selloff in the United States that is imploding all of our market indexes.  And of course I could now get up on my soapbox and point out that, given that this failed socialist model is crashing down in Europe, WHY THE HELL IS OBAMA AND THE DEMOCRAT PARTY DOING THE SAME CRAP HERE?!?!?

And of course, that is still a valid question.

But I have a different theory as to what is going on.

I think this major market reversal is merely a delayed result of the completely artificial levels created by QE2.  And QE2, of course, was the result of our own Obama Federal Reserve machinations.

Take a look at this (and notice it was written in May prior to the end of QE2 in June):

* The QE2 Counter-Play:

The end of Quantitative Easing Two (QE2) will occur at the end of June 2011. This article is designed to provide an area for focused discussions about the design of counter-plays for a potential sharp reduction in equity valuations.

* Why would the end of QE2 cause a sharp reduction in equity valuation? In other words, how does QE2 work?

Quantitative easing is a monetary policy used by the Fed to stimulate the US economy. The Fed buys government bonds and other financial assets with new money that the Fed creates (out of thin air), thus increasing the money supply and reserves of the banking system. This action raises the prices of the financial assets bought, which lowers their yield.

As the Fed systematically purchases a substantial volume of long-term Treasury bonds and other financial assets (i.e., equities), large financial institutions (i.e., bondholders) shift their wealth into equities to achieve a higher return. In other words, the Fed’s actions reduce risk in the equities market which makes equities a more sensible investment than bonds. So, simply put, the Fed puts large quantities of money into the markets, inflating the price of equities. Money follows money, and up the market goes.

The resulting rise in equity prices increases household wealth, providing a boost to consumer spending. Figure One clearly demonstrates the effect of quantitative easing.

Figure One

click to enlarge

Of course, a few data points do not constitute absolute proof that quantitative easing is causal to a stock-market rise, or that stock-market increases cause increases in consumer spending.

However, the timing of the stock-market rise, and the lack of any other reason for a sharp rise in consumer spending, makes that chain of events look very plausible. Figure One shows us that shortly after QE1 was announced, the market free fall began to stabilize. After the QE1 program was expanded from 600b to 1.725 trillion, the market sharply reversed. When QE1 ended, the market once again reversed with about a 20% drop. That’s 200 S&P points (2,000 Dow points) over a two month time period.

QE2 was then suggested, and the market reversed. At the moment of decision, the market hesitated, then QE2 was announced, and once again, the market sharply increased. The time line of these events is perhaps more clearly demonstrated in Figure Two.

Figure Two

Note that as the Fed buys Treasures, the yield stabilizes at about 3.5%. Figure Three demonstrates a clear association between the Fed purchases and commodity prices.

Figure Three

* Consumer Spending and Increases in Share Prices:

Note – the source for this section is based on a published interview with Martin Feldstein, Professor at Harvard.

The magnitude of the relationship between the stock-market rise and increases in consumer spending also fit the data. Share ownership (including mutual funds) of American households totals approximately $17 trillion. So a 15% rise in share prices increased household wealth by about $2.5 trillion.

Relationship Between Wealth and Consumer Spending:
Historically, the association between wealth and consumer spending implies that each $100 of incremental wealth raises consumer spending by about four dollars, so $2.5 trillion of additional wealth would be expected to raise consumer spending by roughly $100 billion. That figure matches closely with a drop in household saving and the resulting increase in consumer spending.

Since US households’ after-tax income totals $11.4 trillion, an one-percentage-point fall in the saving rate means a decline of saving and a corresponding rise in consumer spending of $114 billion – very close to the rise in consumer spending implied by the increased wealth that resulted from the gain in share prices.

None of this appears to augur well for 2011. There is no reason to expect the stock market to keep rising at the rapid pace of 2010. Quantitative easing is scheduled to end in June 2011, and the Fed is not expected to continue its massive purchases of Treasury bonds after that.

Without increases in stock-market wealth, will the savings rate continue to decline and the pace of consumer spending continue to rise more rapidly than GDP?

Will the strong economic growth at the end of 2010 be enough to propel more spending by households and businesses in 2011, even though house prices continue to fall and the labor market remains weak? And does artificial support for the bond market and equities mean that we are looking at asset-price bubbles that may come to an end before the year is over?

* The Hedge Shack:

So what does the investor do? Based on what happened at the end of QE1, it appears we can anticipate a 15% to 20% drop in the overall market. Are their any market sectors that would provide safety?

I’ve discussed quantitative easing.  As an example, I said on May 9:

QE2 is the economic equivalent of sugar in nutrition. Will it provide quick energy? Sure it will. Will that quick energy come at the expense of future health? You bet it will.

Right now, as a result of the Obama Federal Reserve’s policy of increasing the monetary supply by buying debt from itself (literally creating money out of thin air), there is more economic activity. Right now, as a result of this policy, credit rates are lower. Fewer banks and corporations are going under because of the ready access to cheap money. Investors see the stability and invest.

We should all feed our children tons of sugar, so we can enjoy the short term bonanza of frenetic activity.

Unless you worry about all the cavities, the weight gains, the diabetes, and of course that huge depressing crash with all of those catastrophic health consequences that necessarily come later.

The first time we ended QE1, the stock market lost 16% of its value in two weeks. Which is to say it didn’t work the first time for the same reason it won’t work this second time. Or a necessary third time, etcetera.

Talking about this new Keynesian tactic of quantitative easing with a financial whiz is kind of like the opposite side of talking to a financial whiz about gold.  Gold is routinely pooh-poohed by financial whizzes because if people bought gold, they wouldn’t need all of the damned financial whizzes, now would they?

Now, let’s just say for the sake of argument that you were watching the Democratic National Convention in August of 2008 and came to the belief that the mainstream media coverage was so blatantly biased and dishonest that Barack Obama was going to win the election.  And you had a vision of the sheer smackdown that would happen in this “God damn America.”

So you made an appointment with your portfolio manager and told her you wanted to cash out all of your stock holdings so you could put your investment nest egg into silver and gold.

What do you expect your portfolio manager would say?  Do the words, “This is a big mistake.  Trust me, the stock market is not going to collapse.  The average gains of the stock market invariably outperform gold indices.  Blah blah blah.”  The bottom line is that if you pull your money out of the fund she manages, she’s not going to get any more of your money.

Well, the fool who did that would have bought all kinds of silver at about $13 an ounce and gold at about $825 an ounce.  And that fool would have more than doubled his money while everybody else lost their shirt, then got part of their shirt back if they played the game right, then lost their shirt again.

And, of course, if that fool happened to be watching CNBC yesterday, he would have listened and laughed as the same sort of experts pooh-poohed gold because it went up in value to an all-time high before taking something like a $30/ounce hit.  And the smart guys said, “See what happens when you put your money in gold and silver?”

And the fool was thinking, “Yeah.  I more than double my money and laugh like a drunk monkey while everybody else runs around screaming like a bunch of Chicken Littles.”

It’s pretty much the same sort of thing with quantitative easing.  Only it’s a lot more technical, and you’ve got to be a whole lot smarter and a whole lot more informed to make any money before the whole economy comes crashing down.  And in the age of quantitative easing, boy do you ever need your financial whiz kid to help you plot your course

QE1 and QE2 were abject disasters.  And I don’t doubt for a second that the “correction” that we saw yesterday – and from all accounts will see again today given the Asian market bloodbath – was in large part a delayed reaction to the end of the sugar high of QE2.  Particularly given that Fed Chairman Ben Bernanke said, “There will be no QE3 for the moment, but QE2 won’t come to an abrupt halt at the end of June either.”  Which is to say that nobody really knew when to start the selloff after the end of the last sugar high.

But what do I know (or the above fool, for that matter?)?

But here we are – all promises aside – at the door to QE3:

ROUBINI: QE3 Has Begun
Joe Weisenthal|Aug. 4, 2011, 7:05 AM

With markets tanking, and the economy weakening, buzz about the Fed doing QE3 has really heated up.

The FOMC meets next week, and the Jackson Hole conference (where QE2 was announce) happens soon thereafter.

But arguably, the next round of general easing has begun.

Yesterday at 3:00 AM the Swiss lowered interest rates to stem the rise of the Franc, and last night Japan intervened to make its currency weaker.

And then today, the ECB confirmed more bond buying, so however you slice it, the central banks are back into easing mode.

On Twitter, Nouriel Roubini declares that the latest currency interventions from Switzerland and Japan represent the start of QE3, ultimately ending in more Fed easing

Here’s a video that is just looking more and more likely to be history before the event:

Headed In The Right Direction? Mortgage Delinquencies, Unemployment UP; Market, Leading Economic Indicators DOWN

Nothing was more responsible for the economic implosion of 2008 than the mortgage industry.  So it is somewhat illuminating that – to go along with the European Union government spending crises and yesterday’s corresponding bloodbath in the Dow (down 376 points) which officially put Wall Street into “correction territory” – we now see that, if anything, our mortgage woes under Obama are actually worse than ever.

Mortgage delinquencies hit 10%
By Les Christie, staff writerMay 19, 2010: 1:20 PM ET

NEW YORK (CNNMoney.com) — A dubious distinction was reached during the first three months of 2010: More than 10% of all mortgage borrowers are now behind on their payments.

The delinquency rate hit a record of 10.06% in the first quarter, according to the Mortgage Bankers Association. The seasonally adjusted rate accounts for all mortgages on properties that have up to four units and that are at least one payment late.

The rate has been inching steadily toward this record. In the previous quarter, 9.47% of borrowers were behind on payments; and one year ago, 9.12% were late. […]

Nearly all varieties of loans suffered increased delinquencies compared with 12 months earlier.  Prime fixed-rate loans hit 6.17%; prime adjustable-rate mortgages (ARMs) tipped 13.52%. Subprime fixed-rates jumped to 25.69%; and subprime ARMs are a whopping 29.09%.

So, to put it bluntly, a full year and a half later, Barry Hussein hasn’t done anything to fix the biggest component that created the economic collapse of 2008.  Not a damn thing.

The problem is actually worse than ever.

A significant factor contributing to this crisis is unemployment.  But, again, Obama hasn’t done a damn thing (all failed predictions and promises aside) to create jobs:

Jobless claims rise by largest amount in 3 months
By MARTIN CRUTSINGER, AP Economics Writer Martin Crutsinger, Ap Economics Writer   – Thu May 20, 4:29 pm ET

WASHINGTON – The number of people filing new claims for unemployment benefits unexpectedly rose last week by the largest amount in three months. The surge is evidence of how volatile the job market remains, even as the economy grows.

Applications for unemployment benefits rose to 471,000 last week, up by 25,000 from the previous week, the Labor Department said Thursday.  It was the first increase in five weeks and the biggest jump since a gain of 40,000 in February.

The total was the highest since new claims reached 480,000 on April 10. It also pushed the average for the last four weeks to 453,500.

“Although no one expects this volatile series to go in one direction every single week, this is clearly a disappointment,” said Jennifer Lee, senior economist at BMO Capital Markets.

Stocks slid as investors’ already bleak view of the world economy worsened with another drop in the euro and the disappointing U.S. employment news. The Dow Jones industrial average fell more than 250 points in early afternoon trading.

“Unexpectedly.”  The propagandists adverb of choice.

After a newspaper or news station has used the word a thousand times, you’d think they’d grow tired of making excuses for the numerous failures of the White House.  But, noooooo.  They never weary of describing bad news as “unexpected” as a device to imply that it was really nobody’s fault.

Now, mind you, they liked to use the word “unexpected” a lot when Bush was president, too.  But then it was to reduce the credit that Bush should have received for successful policies.  Take the result of his tax cut, which boosted revenue.  The New York Times wrote:

“For the first time since President Bush took office, an unexpected leap in tax revenue is about to shrink the federal budget deficit this year, by nearly $100 billion.

On Wednesday, White House officials plan to announce that the deficit for the 2005 fiscal year, which ends in September, will be far smaller than the $427 billion they estimated in February.”

When a Democrat is president, bad news is always “unexpected” to the mainstream media.  When a Republican is president, it’s always GOOD news that’s “unexpected.”

What is the Obama message that continually keeps being falsified by “unexpected” actual results?

“We can say beyond a shadow of a doubt today we are headed in the right direction,” Mr. Obama told an audience of about 230 workers and local business leaders. “All those tough steps we took, they’re working, despite all the naysayers who were predicting failure a year ago.” ….

“Last month we had the strongest job growth we had seen in year, and by the way, almost all of it was in the private sector, and a bunch of it was manufacturing,” the president said, referring to last week’s report that found that the economy added 290,000 jobs in April. “So this month was better than last month. Next month is going to be stronger than this month. And next year is going to be better than this year.”

Only it’s a load of crap from a pathological liar.

The AP article cited above continues with this paragraph:

In a separate report, a private research group said its index of leading economic indicators dipped slightly in April. It was the first decline in more than a year.  Six of the 10 components on the Conference Board’s index deteriorated. Among them: U.S. residents filed fewer applications to build homes; vendors were slower in delivering supplies to companies; the unemployed filed more claims for jobless aid; and consumers’ confidence dropped.

Ah, but I have absolutely no doubt whatsoever that the drop was “unexpected.”

May 20 (Bloomberg) — The index of U.S. leading economic indicators unexpectedly declined in April, a sign the economic expansion may slow in the second half of the year.

NEW YORK (Associated Press) — A private research group’s index of leading economic indicators unexpectedly slipped in April, its first drop in more than a year and a sign that growth could slow this summer.

I knew it!!!  You clearly can’t blame Obama for any of that.  I mean, duh, who could possibly have “expected” it???

Why don’t we just keep believing more of Obama’s constant stream of lies, instead???

Let’s see.  Month of May.  Major market correction, with the Dow down 900 points this month.  Check.  Mortgage delinquencies up.  Check. Unemployment up.  Check.  Leading economic indicators down.  Check.

Famed market analyst Meredith Whitney says that Obama’s moronic financial “reform” that passed the Senate yesterday will succeed in creating tragic levels of unemployment for extended periods of time.

Just remember: Barack Obama is telling you the truth.  It’s reality that’s lying to you.

Everything is hunky dory.  And anything to the contrary has to be “unexpected.”

A Little Factoid: 77% Of Investors See Obama As ‘Anti-Business’

Stocks have tumbled 552 points as Obama announced his crackdown on American banks.  As a CNBC financial expert put it, “Obamanomics is a Chilling Experiment.”

From the AP on January 22:

NEW YORK – Stocks suffered their fourth sharp drop in five trading days as investors caved to growing anxiety about President Barack H. Obama’s plans to restrict big banks and earnings reports that just aren’t good enough.

The Dow Jones industrial average dropped 217 points Friday, having lost 552 points, or 5.2 percent, over the past three days. Over the past five trading days, the Dow has fallen 537 points, having gained 115 points on Tuesday.

The drop gave the Dow its worst week since the index hit a 12-year low in March.

Investors are saying to Obama, “Please don’t do this,” but he is showing the same deaf-eared fanatic-ideologue determination that he demonstrated in driving his awful ObamaCare forward.

Is it any wonder that most investors – by an overwhelming margin – now believe that Barack Obama is simply hostile to business and to the market forces that allow for economic growth?

From Bloomberg, via Yahoo News:

Obama Seen as Anti-Business by 77% of U.S. Investors
Heidi Przybyla Heidi Przybyla   – Thu Jan 21, 6:25 pm ET

Jan. 22 (Bloomberg) — U.S. investors overwhelmingly see President Barack Obama as anti-business and question his ability to manage a financial crisis, according to a Bloomberg survey.

The global quarterly poll of investors and analysts who are Bloomberg subscribers finds that 77 percent of U.S. respondents believe Obama is too anti-business and four-out-of-five are only somewhat confident or not confident of his ability to handle a financial emergency.

The poll also finds a decline in Obama’s overall favorability rating one year after taking office. He is viewed favorably by 27 percent of U.S. investors. In an October poll, 32 percent in the U.S. held a positive impression.

“Investors no longer feel they can trust their instincts to take risks,” said poll respondent David Young, a managing director for a broker dealer in New York. Young cited Obama’s efforts to trim bonuses and earnings, make health care his top priority over jobs and plans to tax “the rich or advantaged.”

Carlos Vadillo, a fixed-income analyst at Wells Fargo Securities LLC in San Francisco, said Obama has been in a “constant war” with the banking system, using “fat-cat bankers and other misnomers to describe a business model which supports a large portion of America.” […]

Obama’s 71 percent unfavorable rating among U.S. investors is almost matched by two members of his economic team. Both Treasury Secretary Timothy F. Geithner and Lawrence Summers, president of the National Economic Council. U.S. respondents give Geithner a 63 percent unfavorable rating and Summers 67 percent. In October, 57 percent held a negative view of Geithner and 66 percent said the same of Summers.

Like Obama, both men do better with Asian and European investors.

One financial figure to find favor among U.S. respondents is Federal Reserve Board Chairman Ben S. Bernanke, who garners a 68 percent approval rating, which is in line with his marks from non-U.S. investors and the rating U.S. investors gave him in the October poll. […]

The U.S. investors’ overwhelming characterization of Obama as anti-business stands in sharp contrast to the results of a Bloomberg National Poll in December, when 52 percent of U.S. adults said the president had the right balance in his approach.

Obama gets considerably higher marks in Europe and somewhat higher marks in Asia.  Like I give a damn about what socialists think about our socialist president.

Take the Europeans (PLEASE!).  They claim to welcome Obama’s attack against banks, but at the same time announce they have absolutely no intention of killing their nations the way Obama is killing America.

One quote in particular that comes out of the above article:

“The Obama plan is really back to the future. These sort of plans were implemented after the Great Depression and then taken away in the 60s. He is sort of reinstating the same plans to deal with this crisis,” the source said.

Obama is taking us back to the Great Depression to “solve” our recession.  The problem is that economists now realize that FDR’s constant bureaucratic interference was what kept America in the Depression seven years longer than what was necessary.

Anyone with half a brain (which understandably rules out most Democrats) should readily understand that the cost of Obama’s taxes on and interference of banks will only end up being passed on to American consumers in the form of higher fees, charges, and penalties.  Obama is really only taxing us through the banks.  And he’s using populist demagoguery in hopes of making us want to punish the banks so much that we forget that we’ll be seeing higher fees as a direct result of that punishment.

Obama has lost more jobs in one year than any president has lost since 1940.  He has presided over the destruction of 4.1 million jobs.

This is NOT a “future” we should ever want to go “back to.”

Our investors – who far and away have been forced to live under Obama’s policies – pretty much realize he sucks across the board.

What does Obama have to offer?  No solutions, just more problems, and more attacks.  All to the tune of “It’s Bush’s fault.”

Obama’s Plunging Polls Correspond To America’s Plunging Economy

President Obama’s biggest calender item yesterday was his scheduled “having a beer” with his good friend Henry Louis Gates and the man that both Gates (directly) and Obama (indirectly) called a racist, Sgt. James Crowley.  By sitting down for a beer, Obama was attempting to turn the giant turd he laid at his fourth prime time news conference in six months (which is how many George Bush gave in 8 entire YEARS btw) into a gold-plated turd.

I hope the three men clink their glasses to Obama’s plummeting poll numbers and America’s plummeting economy while they pondered why ‘Skip’ Gates is such a bigot and why Barry Obama acted so stupidly by claiming the Cambridge police “acted stupidly.”

Rasmussen has Obama at a -12 approval rating measuring the difference between those who strongly approve and those who strongly disapprove of his presidency; and he is now at only 48% approval – a far cry from his halcyon days of being in the high 60s.  Only 34% of likely voters think the country is headed in the right direction.  And 49% believe America’s best days have come and gone, versus only 38% who think the country will improve.

The hope that once swelled the hearts of Obama voters is fading fast – especially in the swing states he needs to win to have any chance at either future re-election or even current relevance.  “Hope and change” now means, “I hope I still have some change left in my pocket at the end of the month.”

As U.S. recession bites, Ohio hopes fade for Obama
Thu Jul 30, 2009 11:12am EDT
By Nick Carey

TOLEDO, Ohio (Reuters) – Hope and jobs are in short supply in Ohio eight months after President Barack Obama won the recession-battered state in the 2008 election with promises of a better future.

“People were looking for a savior to get us out of this mess and that’s why they voted for Obama,” said Jeff Fravor, 55, a retired train conductor on his way to breakfast on the outskirts of Toledo.

“I’ve nothing against Obama personally, but he’s new to the job and ‘hope’ won’t fix this mess.”

Candidate Obama delivered his message over and over again in Ohio, a politically diverse battleground state that often decides presidential elections. Obama went back to the state last week with an approval rating below 50 percent.

A Quinnipiac University opinion poll released on July 7 showed the Democratic president’s popularity in America’s seventh most populous state had fallen to 49 percent from 62 per cent in May. Even worse for Obama, 48 percent said they disapproved of his handling of the U.S. economy, with 46 percent approving.

The reason for the poll drop? Rising unemployment.

The downturn has pummeled Ohio’s manufacturing base.

“As jobs have gone away, that has created a true focus here on job creation,” said Andrew Doehrel, head of the Ohio Chamber of Commerce. “People look at what’s been done on a federal level in terms of bailouts and stimulus and they see that this has not equated to anything more than lost jobs in Ohio.”

Ohio has not been the state hardest hit by the U.S. recession that began in December 2007, but it is not far off.

Unemployment in the state of 11.5 million people reached 11.1 percent in June, compared with the national rate of 9.5 percent, making it the seventh highest rate in the country. Michigan was first with a rate of 15.2 percent.

TWICE THE UNEMPLOYMENT

Ohio’s unemployment has nearly doubled from 5.7 percent in January 2008. That is not a good start for Obama in a state with 20 electoral votes that could be vital for his re-election effort in 2012.

“It’s not a surprise Obama’s numbers have fallen here and they’ll continue to go down as long as jobs keep being lost here,” said Jim Rokakis, treasurer for Cuyahoga County, which includes Cleveland where unemployment hit 10.1 percent in June. “Americans always want a quick fix to problems, but they are going to relearn patience this time round.”

Toledo in northwest Ohio has been especially hard hit by the recession, in particular because of the auto industry-related plants that dot the area.

“Obama set expectations too high here and six months later, things haven’t got better, so some people are losing hope,” said John Johnson, branch manager of the Southeastern Container Inc plant in nearby Bowling Green, which makes plastic bottles for Coca-Cola Co..

Johnson said he had to turn away qualified workers from auto-related plastic companies seeking work. “When people are out of work for a long time, they become very impatient.”

Unemployment hit 14.2 percent in June in Toledo, a city of about 315,000 people. Many of the roads in and out of the city are in a poor state of repair and many downtown stores have closed down. Manufacturing brought the city wealth, so plant closures have taken a heavy toll.

‘DEPRESSION’

“We’re not just in a recession here, it’s a depression,” said Toledo Mayor Carty Finkbeiner. “This downturn has left Ohioans wondering if we’ve lost our place in the sun.”

According to a midyear survey from real estate service company CB Richard Ellis Reichle Klein, Toledo’s retail vacancy rate hit a record level of 14.6 percent.

“Everybody is having a hard time just existing right now,” said Bob Shelley, 72, who runs Shelley Rubber Stamp & Sign Inc for his father in downtown Toledo. “All businesses have been hit, so everybody’s giving everybody a break right now.”

Shelley said he felt Obama had an overcrowded agenda.

“He’s trying to satisfy everyone at once and he’s trying to rush everything through Congress,” he said. “But if you rush like that, you’re bound to make mistakes.”

Angie Carter, 32, a market research analyst in downtown Toledo, said she voted for Obama and he just needed time.

“This is a recession and we live in a manufacturing state,” she said on a cigarette break. “It’s going to take time to turn it around.”

When touting his $787 billion stimulus package earlier this year, Obama cautioned that a recovery would take time.

The president also has time to recover in Ohio if jobs come back. Aware of its importance, he was there last week to tout his healthcare plans. The last candidate who won Ohio but lost the election was Republican Richard Nixon in 1960.

Rokakis said Obama’s speech in Cleveland on July 23 was no accident.

“Obama is a smart man and he knows how important Ohio is,”

The article portrays Obama as having said that recovery would take time under his stimulus.  It fails to mention that the Obama administration – in pushing the failed stimulus package through Congress – predicted that unemployment would rise no higher than 8% if his stimulus passed.

As bad as things are now, there is no realistic reason to believe they will get better.  Meredith Whitney, the Wall Street analyst who gained much credibility in predicting the mortgage meltdown, is predicting unemployment will rise to 13% or higher.

The date for a housing market recovery stretches to 2015.

Obama’s deficits are soaring to stunning levels.  Back in March the Congressional Budget Office estimated that Obama’s “huge annual budget deficits that would force the nation to borrow nearly $9.3 trillion over the next decade — $2.3 trillion more than the president predicted when he unveiled his budget request just one month ago.” And that mindbogglingly ginormous figure doesn’t include the trillion plus hole we would dig passing Obama’s health care plan.

As the Wall Street Journal’s Michael Boskin puts it:

Mr. Obama’s $3.6 trillion budget blueprint, by his own admission, redefines the role of government in our economy and society. The budget more than doubles the national debt held by the public, adding more to the debt than all previous presidents — from George Washington to George W. Bush — combined.”

Obama has blamed President Bush for the deficits, but not only has he racked up far more debt than did Bush, but as a Senator Obama actually voted for the very Bush-budget that Obama is now blaming on Bush – including the $700 billion TARP bailout.

It is also worth knowing that the federal government has exposed itself to $23.7 trillion in risks with its bailouts since TARP (which is turning out to be a thinly disguised anagram for “TRAP”).

Those massive deficits guarantee future economic pain, but recent developments are beginning to show that our future pain may already be here right now:

Weak Treasury Auctions Raise Worries About US Debt Burden
By: Reuters     Wednesday, 29 Jul 2009

The U.S. Treasury sold $39 billion in five-year debt Wednesday in an auction that drew poor demand, raising worries over the cost of financing the government’s burgeoning budget deficit.

It was the second lackluster showing in as many days,  convincing analysts that the stellar results of debt auctions just a few weeks ago were a fluke and that Thursday’s $28 billion seven-year offering could suffer a similar fate.

Under the weight of the ballooning deficit, the government has raised auction volumes and analysts now wonder whether the strain on the market is showing.

“Obviously everyone is inferring that tomorrow’s won’t be good either,” said James Combias, head of government bond trading at Mizuho Securities USA in New York. “Maybe you will see more interest tomorrow but I think the increase in the auctions and the size of them may be starting to have an effect. These are very large auctions.”

We are witnessing a terrifying unfolding scenario in which “Interest due on the debt could easily be $1 trillion toward the end of the next decade.”

Like the Texas Hold’em player who pushes every last dime into the center of a poker table, the federal government is now “all in” with its commitment to push the national debt to 50% of GDP. The Congressional Budget Office believes that the Treasury will have to borrow nearly $2 trillion this year. None of that is new news, but what is beginning to emerge is a picture of a government which has narrowed its options for improving the economy down to one. Either GDP turns sharply up next year or the deficit will become an unmanageable burden. The Treasury will have to default on interest payments if sharply raising taxes in 2010 and 2011 does not bring IRS receipts to historic highs. That would not appear to be likely with unemployment moving toward 10% and American corporate earnings badly crippled.

You may not know it, but your government under Obama has gambled this country’s future – and gambled poorly.  Obama believed his $787 billion stimulus – which was actually scored by the CBO to be $3.27 trillion – would stimulate big, but it has been a total dud.  And as we continue to pile on debt on top of debt on top of debt, and combine that with continuing high unemployment and low economic output, the result is insolvency and doom.  And it is already beginning to rush toward us like an enraged Kodiak bear.

Some are pointing at the seemingly recovering Dow Index to argue that the worst is behind us and that we are on the road to recovery.  As reported by Reuters:

No Economic Recovery in Sight, Only Inflation
Mon May 11, 2009 9:01am EDT

FORT LEE, N.J., May 11 /PRNewswire-USNewswire/ — The National Inflation Association yesterday released the following statement to its http://inflation.us members:

“Wall Street would like you to believe that the Dow Jones’ recent 33% rally from March’s low is due to improving economic fundamentals, but it is our belief this rally is due to nothing but inflation.

“Jobs data released on Friday shows that U.S. employers cut 539,000 jobs in April, the fewest since October. However, these numbers were artificially strong due to the U.S. government increasing their payrolls by 72,000, which included the hiring of about 60,000 temporary workers in preparation for the 2010 census.

“Government jobs are non-productive jobs that normally get paid for by taxpayers. However, because the U.S. already has a huge budget deficit with tax revenues likely to decline substantially, these jobs will be paid for through inflation. An increase in government jobs is not a sign that the economy is improving, but only a sign that we are digging our economy into a deeper hole that will ultimately lead to the U.S. dollar collapsing.

“Even Warren Buffett, who is a huge supporter of Obama and has defended his economic policies, said last week that with political leaders showing little inclination to raise taxes, the only way to pay for excess spending will be by inflating the currency and shrinking the value of the dollar.

“The worst of the recession is not behind us. Nominally, anything can happen to the Dow Jones. If the Federal Reserve prints enough money, the Dow Jones could go back to 14,000, but it won’t mean anything if it costs $2,000 to fill your refrigerator with groceries.

Obama’s spending has put us into a genuine crisis: we are now in a situation where any recovery will be immediately followed by sharp increases in inflation, unless government either sharply raise taxes across the board (which will undermine the economy) or unless they sharply raise interest rates (which will also undermine the economy).  Both options are politically unacceptable.

You’d better be thinking about getting a wheelbarrow, because you’re eventually going to need to one to bring enough cash to the grocery store to buy your daily bread.

That was my long-winded way of saying that Obama’s polls are likely to drop to the point where angry villagers armed with pitchforks and torches start storming Castle Obamastein as the economy drops right along with his popularity by the end of his one-term presidency.

Biden: ‘We Misread the Economy’ – And it’s all the Republicans’ Fault

Some distant day, many scientists believe, the earth will be devoid of human life due to some cosmic catastrophe or – ultimately – due to our depleted sun transforming into a red giant. The truly good news about such an otherwise bleak future is that the Obama administration will presumably no longer be able to blame Republicans for the economy that they “inherited.”

Biden: We ‘Misread the Economy’

July 05, 2009

Big admission from Vice President Joe Biden today.

“The truth is, we and everyone else misread the economy,” Biden told me during our exclusive “This Week” interview in Iraq.

Biden acknowledged administration officials were too optimistic earlier this year when they predicted the unemployment rate would peak at 8 percent as part of their effort to sell the stimulus package. The national unemployment rate has ballooned to 9.5 percent in June — the worst in 26 years.

“The truth is, there was a misreading of just how bad an economy we inherited,” said Biden, who is leading the administration’s effort to implement it’s $787 billion economic stimulus plan.

“Now, that doesn’t — I’m not — it’s now our responsibility. So the second question becomes, did the economic package we put in place, including the Recovery Act, is it the right package given the circumstances we’re in? And we believe it is the right package given the circumstances we’re in,” he told me.

The vice president argued more time is needed for the stimulus to work.

“We misread how bad the economy was, but we are now only about 120 days into the recovery package,” he said. “The truth of the matter was, no one anticipated, no one expected that that recovery package would in fact be in a position at this point of having to distribute the bulk of money.”

Biden didn’t rule out a second government stimulus package, but downplayed calls from Nobel Prize-winning economist Paul Krugman this week that a second stimulus will be needed.

I pressed the vice president, who is also leading the administration’s middle-class task force, on whether he’d rule out a second stimulus package.

“So, no second stimulus?” I asked.

“No, I didn’t say that,” Biden said, “I think it’s premature to make that judgment. This was set up to spend out over 18 months. There are going to be major programs that are going to take effect in September, $7.5 billion for broadband, new money for high-speed rail, the implementation of the grid — the new electric grid. And so this is just starting, the pace of the ball is now going to increase.”

Let’s not tell anyone that liberal Paul Krugman’s warning that we need a second stimulus is secret code for, “The first stimulus didn’t work worth squat, so let’s throw more money down the toilet.” And let’s for DAMN sure not tell anyone that unemployment benefits are going to be ending for workers starting in September and things will truly begin to increasingly suck after that as the unemployment rate grows like “the other ‘green shoot'” up and up and up.

Joe Biden says, “We and everyone else misjudged the economy.” No, Joe, it just aint so. Just you and your stupid liberal friends misjudged the economy. Don’t drag anyone else into your ignorance. Business professionals back in October predicted that Obama would literally bankrupt the country within three years if he was elected. Republicans (such as Paul Ryan) widely predicted the terribly flawed and terribly partisan pork-laden stimulus would fail – which is why only three out of 239 Republicans voted for it (and you can actually make that TWO out of 239, given that one of the three “Republicans” was RINO traitor-turned Democrat Arlen Specter).

Please don’t try to involve conservatives in your party’s stupidity, Joe. It aint right to lie.

The fact is, the porkulus is a complete failure that will cost the American people’s children’s children’s children $3.27 TRILLION and produce NOTHING.

And the fact is, when the Obama White House assured the American people that his stimulus would save the day, he assumed responsibility for the economy. It is HIS baby now, and he can’t keep racking up trillions and trillions and trillions of dollars in stupid and useless spending that will literally “bankrupt the country” and blame the fact that it isn’t working on Republicans.

It’s also rather funny that Vice President Biden would say “there was a misreading of just how bad an economy we inherited.” Please realize that for the last two years – and most definitely for the last eight or nine months – Barack Obama and Joe Biden have been comparing the present economy to the Great Depression. And now they are claiming they didn’t know how bad it was? What’s worse than the Great Depression? It is beyond ludicrous that these people can spend all this time demonizing the economy as the worst imaginable, and then argue they didn’t know that it was that bad.

Here are the opening two paragraphs from a February 13, 2009 Wall Street Journal piece that proves the lie of Biden’s remark:

President Barack Obama has turned fearmongering into an art form. He has repeatedly raised the specter of another Great Depression. First, he did so to win votes in the November election. He has done so again recently to sway congressional votes for his stimulus package.

In his remarks, every gloomy statistic on the economy becomes a harbinger of doom. As he tells it, today’s economy is the worst since the Great Depression. Without his Recovery and Reinvestment Act, he says, the economy will fall back into that abyss and may never recover.

How can Biden, Obama, or Democrats claim they didn’t realize how bad the economy really was after their previous constant fearmongering of the economy?

And the most famous and oft-used line, of course, is that Democrats keep claiming that they “inherited” the economy.

For the record, the Dow Industrial Average was at 11,986.04 on November 3, 2006 when Republicans were last in control of Congress. The unemployment rate for October of 2006 was at 4.4% when Republicans last ran things. As I write this, the Dow is at 8163.60 (on July 7), and the unemployment rate is at 9.5%, respectively. Nancy Pelosi and Harry Reid have been running the House and the Senate for the last two years, and a fine job of running the country into the ground they’ve done.

Just why is it that Democrats can have control over both the House and Senate while an economy goes from prosperity to impoverishment, and still bear no responsibility for such a result? But that’s the narrative, and both the Democratic Party and the mainstream media stuck to their scripts as though the lines had been written by Shakespeare himself. Do you see the great shining lie that you’ve been told, and told over and over again?

Since the Democrats have been in charge on both branches of Congress, the housing market has collapsed, the banks have collapsed, Fannie and Freddie have collapsed, the auto industry has collapsed, and things have generally turned to the fecal matter that Pelosi’s and Reid’s head are full of, generally.

But, hey, let’s keep blaming everything on Republicans, anyway. When you have an electorate so completely ignorant that 57.4% of voters weren’t even able to identify which party controlled Congress, such demagogic claims work.

The ONLY thing that Democrats actually “inherited” was moron genes, a talent for demagoguery and deceit, and Nancy Pelosi and Harry Reid (please see “moron genes”).

Now, the OTHER thing that Democrats love to claim was that Republicans are to blame for the economic disaster because Republican George Bush was President when it happened. And we are all to conveniently forget the fact that such reasoning should likewise make Democrat Barack Obama – who is president RIGHT NOW – is thereby responsible for the current state of the disaster that he nonetheless keeps blaming on Bush.

On what possible grounds are we to blame Bush? What is it that Bush did or didn’t do that created our disaster, and which Democrats who controlled both the House and the Senate are somehow absolved from having done or failed to do? Bush, we have been repeatedly lectured, failed to regulate the housing finance industry. And that lack of regulation caused the financial industry to self-destruct. Because the government is far better able to run things than the private sector, as we all know.

Well, wrong, wrong, and wrong, respectively. But let’s stick with the Democrats’ chief script item and consider just who truly failed to regulate the housing finance industry when it actually would have done some good, and who was really in bed with the worst players who created the crisis in the first place.

First of all, Bush TRIED to regulate the housing finance industry. And the ONLY thing that kept him from succeeding was DEMOCRATS.

Let’s go back to September 11, 2003, to see what the New York Times had to say. The article begins:

The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago.

Under the plan, disclosed at a Congressional hearing today, a new agency would be created within the Treasury Department to assume supervision of Fannie Mae and Freddie Mac, the government-sponsored companies that are the two largest players in the mortgage lending industry.

The new agency would have the authority, which now rests with Congress, to set one of the two capital-reserve requirements for the companies. It would exercise authority over any new lines of business. And it would determine whether the two are adequately managing the risks of their ballooning portfolios.

And it ends:

Significant details must still be worked out before Congress can approve a bill. Among the groups denouncing the proposal today were the National Association of Home Builders and Congressional Democrats who fear that tighter regulation of the companies could sharply reduce their commitment to financing low-income and affordable housing.

”These two entities — Fannie Mae and Freddie Mac — are not facing any kind of financial crisis,” said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. ”The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.”

Representative Melvin L. Watt, Democrat of North Carolina, agreed.

”I don’t see much other than a shell game going on here, moving something from one agency to another and in the process weakening the bargaining power of poorer families and their ability to get affordable housing,” Mr. Watt said.

Go back to the phrase at the beginning of the article: “the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago.” That would refer to the Clinton Administration’s aggressive push to put even more future poison in the fangs of the terrible Community Reinvestment Act.

Democrats blocked the passage of the Bush attempt to regulate the housing finance industry. They were the ones who killed regulation, not Republicans. They said there wasn’t a problem. They said that everything was just peachy dandy.

Democrats essentially say that the American people should blame George Bush for not being able to stop Democrats from being stupid, incompetent, and depraved vermin. But how can anyone stop Democrats from being stupid, incompetent, and depraved vermin? It would be like trying to stop the wind from blowing.

Bush and Republicans tried again to REGULATE the housing finance industry in 2005. John McCain wrote a passionate letter warning of an impending collapse of the housing finance industry and urging passage of the bill (specifically, the Federal Housing Enterprise Regulatory Reform Act of 2005, S. 190). But “without a single Democrat vote, the bill was doomed if brought to the floor for the critical 60-vote cloture.” Housing finance reform died a death by Democrat.

As late as JUST BEFORE THE WHOLE HOUSING FINANCE INDUSTRY COMPLETELY COLLAPSED, Democrat Barney Frank is on the record saying:

REP. BARNEY FRANK, D-MASS.: I think this is a case where Fannie and Freddie are fundamentally sound, that they are not in danger of going under. They’re not the best investments these days from the long-term standpoint going back. I think they are in good shape going forward.

You can watch Democrats fiddling with the economy just before it burned here (Youtube).

Even Bill Clinton – hardly a Republican source – blamed Democrats and NOT Republicans for refusing to regulate the housing finance industry:

Bill Clinton on Thursday told ABC’s Chris Cuomo that Democrats for years have been “resisting any efforts by Republicans in the Congress or by me when I was President to put some standards and tighten up a little on Fannie Mae and Freddie Mac.”

So the bottom line is this: Democrats blocked reform and regulation. They denied there was a problem. They continued to deny that there were any problems, and continued to block reform and regulation until right before the whole economy went down the drain.

And then they blamed the Republicans for the mess that they had created, refused to fix, and denied even existed in the first place.

What is utterly beautiful in its moronic perfection is that Barney Frank is now trying to do to the condominium market what he did to the housing market by forcing lenders to make risky loans all over again.

Okay, okay, so it was the Democrats who actually screwed up the universe, but you still have to admit that the Obama Administration inherited the problem. It clearly wasn’t in power when the fit hit the shan. Right?

Not quite so fast.

Technically, the Obama Administration is obviously not be to blame, having only began its hopefully very short life on January 20, 2009. But Barack Obama personally? You should probably know what a nasty piece of work your president was before he became your president.

Barack Obama as a Senator took more money from Fannie Mae and Freddie Mac than anybody except his fellow scumbag and fellow Democrat Chris Dodd (who had direct oversight as Chairman of the Senate Banking Committee). Obama also took more money than disgraced and bankrupted Lehman Brothers than anyone but his fellow sleazeball and fellow Democrat Chris Dodd. Now, maybe you’re one of those people who believe that corrupt and soon-to-be-bankrupted organizations give buttloads of money to politicians just because they’re feeling generous. But people who actually live in the real world understand that Fannie, Freddie, and Lehman Brothers gave money to the politicians whom they believed would be best for their corporate asses and their corporate assets.

Barack Obama as candidate for president made Penny Pritzker – who was at the very EPICENTER of the subprime loan fiasco – his national finance chair. She paid a “fine” of $460 million dollars to basically buy her way out of prison for her part in the early beginnings of the collapse that would eventually extend to the entire economy. Penny Pritzker was to the stability of the housing finance industry on Wall Street what Freddie Krueger was to the dreams of teen agers on Elm Street; just what kind of Faustian deal do you believe the politician who took more money in less time from the worst players in the crisis than anyone bar none struck to have knife-gloved Penny Krueger open up her Rolodex full of demons?

Barack Obama as a private citizen was one of the ACORN lawyers who sued Citibank in 1994 and forced – FORCED – them to reduce their credit standards and make extremely housing mortgage loans to minorities who would subsequently prove unable to pay them. And the ACORN suit took advantage of the openings created by President Bill Clinton in the 1990s. The result of that lawsuit changed the housing finance industry forever afterward – and basically doomed it as soon as housing prices started to drop.

So as President Barack Obama may have “inherited” the crisis; but as a private citizen, as a Senator, and as a candidate for President, he was at the very center of the mess that created the crisis right up to his giant Dumbo ears.

And as Obama continues to blame his inability to handle the economy on what he “inherited,” let us not forget that it was Barack Obama who swore up and down that his Generational Theft Act of 2009 would fix the economy – NOT Republicans and NOT George Bush – and it was his economic plan that completely failed to produce the promised results.

It was Barack Obama who put his credibility behind a plan that his administration promised would hold unemployment down below 8% and it was Barack Obama who has presided over an unemployment rate that is now 9.5% and rising. The Congressional Budget Office predicted that unemployment would only have gone to 9% by 2010 had we done nothing at all. And nothing would have been a heckuva lot cheaper than $3.27 trillion. I, for one, assure you that I could have sent the economy crashing for a lot lower price tag that Barack Obama has charged you.

The unemployment rate in November – when Barack Obama was elected – was a Lilliputian (by comparison to the gigantic mess Obama has since made of the economy) 6.7%. It was 7.2% a few months later when his administration assured the American people that he could keep unemployment under 8% if his stimulus plan was passed. It is now, I should say again, at 9.5% – and it many experts expect it to be 11% by next summer.

Obama’s answer is still MORE colossal spending. The first stimulus – advertised as a $787 billion package but actually costing $3.27 trillion according to the Congressional Budget Office – is now said to have been too low. We need more porkulus, they tell us. A lot more. We need to borrow more massive debt and pile up more massive deficits that will crush our economy with staggering interest payments in the very near future and ultimately cause a complete collapse of our way of life. We need to nationalize our health care so it will be more like the $86 trillion-in-the-hole runaway freight train to destruction that Medicare is. And we need cap-and-trade legislation that will cap our productivity and trade our prosperity to ensure that our economy can never hope to be productive again.

Keep blaming Bush. Keep blaming Republicans. Keep blaming “failed conservative policies.” Blame ANYONE and ANYTHING but Barack Hussein Obama and the Democratic Party that is now in total control of everything.

Just let me shout in your face that by doing so you will help create an economy that will make the Great Depression look like prosperity when the policies that you so stupidly supported implode into staggering debt and even more staggering hyperinflation. And you and your children will starve shoeless in the cold while food riots and tax rebellions erupt all around you as your once great nation is reduced to banana republic status.

Media Pitches Market Increase As Confidence In Obama; What About Market Drops?

For the last week I kept hearing stories like this one:

Stocks soar on word of Obama’s choice to lead Treasury
BY KEVIN G. HALL AND MARGARET TALEV
McClatchy News Service

WASHINGTON — New York Federal Reserve Bank President Timothy Geithner is expected to be President-elect Barack Obama’s choice to head the Treasury Department. Reports of his selection sent stocks soaring at the close of trading Friday.

A couple Associated Press headlines:

“Obama urges bold action on economy; stock market soars”

“Stock Market Soars On Reports Geithner Will Head Treasury“

Boy, that Barack Obama, he’s just … magnificent, isn’t he?  You can almost hear the reporters discussing as he walks by, “Should we prostrate ourselves before him, or would that not appear objective?”

There’s that obvious question that needs to be asked: if you say the market “soared” because of Obama’s appointments, shouldn’t you have to figure they tanked because people started second guessing those selfsame appointments when it drops nearly 700 points only a few days after “soaring”?

Not when you’re crazy in love with Barack Obama, you don’t.

Historically, the market almost ALWAYS goes up in the days immediately prior to Black Friday.  There were clearly reasons OTHER than, “Boy, those Obama picks sure are awesome!” to account for the market increase last week.

I found this funny: the market goes up, and Obama is over-the-top wonderful ruling and reigning from his just-invented “Office of the President-elect.”  The market totally tanks only FOUR business days after the “soaring” stories and the AP headline – “Dow plunges 679 to fall to lowest level in 5 years” conveniently omits any link to Obama.

It’s like rephrasing the sign to say, “The Buck Stops Here – Unless Of Course The News Is Bad.”

What I DID see when I clicked on the 679-point drop story was a nice big picture of Bush with the question, “How would you rate President Bush?”  And the obvious answer is, “Well, not real darn good when the stock market  tanks 700 friggin’ points!”

So you have the essence of the media strategy: market goes up: “Way to go, Obama!”  Market goes down: “That damn Bush!”  Expect to see every iteration of that under the sky for the next few years.

The neverending media narrative: Economy goes up; credit Democrats.  Economy goes down; blame Republicans.