Don’t Lose Sight of Today’s Economic Reality
November 24, 2010 2 Comments
BECKLEY — I thought the following article was interesting. Especially, given all the positive economic propaganda in the media prior to the start of our “holy” shopping season. The title caught my attention – China, Russia Quit Dollar. Putin says the following:
“About trade settlement, we have decided to use our own currencies.”
While the title of the article is quite catching the content is a little lacking. For one, there is no quote from China saying they are “quitting the dollar”. In fact, it is only Putin who shares such statements. However, where there is smoke often times there is fire. I have no doubt that China has plans to reduce it’s hold in dollar denominated treasuries and currency in order to reduce inflation in it’s country. It is inevitable as the U.S. monetize it’s debt China cannot sustain nor should it sustain a bailout of the U.S. consumer at the cost of the purchasing power of it’s own citizens.
Originally, when Ben Bernake had promised to congress and the American people to provide an adequate exit strategy with his original Quantitative Easing back in 2009 many people called him on his bluff. Even Stephen Van Nuys and myself pointed out at the time the precarious economic situation in which Bernake was placing us. What was Bernake’s real exit strategy for Quantitative Easing? It was Quantitative Easing 2 (QE2) this time he was smarter then to lay out an exit strategy because now it’s just about printing money as we will most likely begin to see QE3, QE4, etc.
Meanwhile, unemployment is still sky high with only another 400,000+ losing jobs last month with continuing orders for durable goods (3.3% U.S. Made Durable Goods Decline) falling in conjunction with unemployment the economic news headed into the holiday’s is very dire indeed. Even when one takes the governments “numbers” at face value. However, this really isn’t much of a change from the past but these are numbers I continue to keep my eye on. And so should you! Especially, in light of all the media propaganda out there today.
With CNBC, MSNBC, and Fox News respectively running articles, stories and news about “Flush with Profits Wall Street Starts to Spend Again“, “Holiday Cheer: Economy Shows Positive Signs“, and “Wall Street Cheers Bullish Economic Indicators” I encourage you not to buy into the propaganda. Wall Street reads the fall in NEW jobless claims as a positive indicator as it declined by around 10% and came in below July 2008 as the best month in nearly 2 years. However, I was also reading my subscription to CFO magazine and only .7% of CFO plan to hire in the next 12 months. So, those that are still losing their jobs will probably continue to have a hard time FINDING jobs. Don’t buy into the bullish news on TV and in the Mass Media. They are the same goons that call the GM IPO a success.
As America heads to the stores on Friday I hope they’ve put into place plans for the deteriorating economic conditions of this country before spending the resources they will need to survive future economic turmoil. If you have planned for the coming economic turmoil in this country enjoy your Thanksgiving and be thankful God granted you the foresight to prepare. If you haven’t planned then enjoy your Thanksgiving in moderation saving your resources to plan for the lean years and be thankful for Gods grace in that the economic detioriation has been moderate thus far granting you opportunity for adjustment.