Now and then//1929, 2009//the coming Depression. Part IX

By , November 2, 2009 9:18 pm

Rising “Gold” prices used to mean that “people” feared inflation. There are three things wrong in today’s picture: (1) there has been no inflation since February this year, inflation then was less than one per cent (.24%). March saw deflation of .38% or another way of looking at it, inflation of minus .38%; the deflationary rate continue to rise through July and went down slightly in August and September. Still, though, we have been in deflation since February to date; I have asked then why “Gold” has risen approximately 50% during this period with no inflation? What is driving Gold prices up when there is no inflation, also keep in mind that rising Gold prices (due to inflation) would normally mean rising interest rates and falling Treasury Bonds and at this time the exact opposite is happening to government debt. (2) Rising “Gold” prices used to mean falling numbers on Wall Street, yet, the Stock Market has risen (until three days ago) more than 11% since June. I now have to ask, what is driving the Market up? (3) Government intervention in the financial markets to almost 29% of GDP is beyond comprehension, (during the “Great Depression government intervention was a mere 3.2% of GDP) and has confused established factors which determine the outcome of results in the financial markets and Wall Street. Folks, something has got to give, this trend will not continue. It is foolish to think that the flooding of the financial markets with government money will cure this chaotic economic disaster we are in. I stand by what I have been saying since the beginning of these series and that is that we are now entering a severe “Depression”. I wrote a while back in one of these posts not to be deceived with the up swings in the market; the market will fall before next summer. There is absolutely nothing with substance going on to sustain the market. So what is driving gold prices up, stock market and Treasury Bonds; I don’t know but would make an educated guess that a lot of it is simply assumptions and the belief that this administration will continue to pump money into the financial markets. Wake up folks, Barack Obama is not at all concerned about the middle class, about jobs or about the economy. “Tarp” and “Stimulus” money thus far has gone to those “big businesses” that supported him, to any and all “labor unions” and to “States” that are “blue” or obey his every wish. Beware of an unusual rise in the strength of the dollar; too many other economics are just waiting to offload their dollars. They are no longer looking at just the strength of the dollar but at the following troubling facts: (1) unemployment-up 50% since November 08, (2) GDP-down 25% since November 08, (3) Housing starts-down 10% since November 08, (4) Food Stamps-up 15% since November 08,  (5) mortgages underwater-up 66% since November 08, and (very important) DEFICIT-up 300%-YES- THREE HUNDRED PER CENT. For decades we have believed that Wall Street (Financial Markets-Industry) gave us an indication of the heartbeat of the economy and/or the future of economic success; that is no longer true or even believable. Our markets, our industries, our healthcare, our freedoms and lately even our “freedom of speech” are been manipulated, coerced, controlled and hidden in lies and deceits by Washington. It is no longer a “Free Market”; it is Washington and Wall Street, it is Washington and GM, it is Washington and GE, it is Washington and SEIU and at its best this government intervention with the markets and industry has created market distortion and there we have the ONLY REASON the Stock Market has gained since last March. The fall is around the corner. We need to put a face on this illegal game which is been played with our economy, we need to put a face on the attempt to silence any that would disagree, we need to put a face on the “real brown shirts” and folks that face is NOT THE CONSERVATIVE MOVEMENT.

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