I love Jackson Hole, Wy. It has gorgeousosity.
So when Ben Bernanke declared the recession over while attending whatever it is that government workers attend in places like Jackson a few weeks ago...I thought a couple of things might be happening.
Perhaps the high mountain air got to him. Maybe all that cognac made him dizzy. Or perhaps, he fell prey to this great mirage he has created. Or perhaps, (this is the sinister side of me) while dumping tons of fiat currency everywhere he was avoiding the deflationary pressure of a depression and making his boss proud of him at the same time. Maybe he just got carried away.
The answer arrived two or three days later when President Obama announced that for all of his good work, he would reappoint Ben as the Fed Chief. Ah yes...of course.
That's how government works. Blow smoke up everyone's ass and keep your job. Telling the truth? That is tantamount to early retirement and a resting place in the Mt. Honesty Graveyard.
The problem with calling Ben what he is, a liar, is that nothing changes. Lies are acceptable and part of the landscape. Lies get politicians re-elected.
So yesterday, we discovered that in fact, the Great Cash for Clunkers taxpayer money giveaway didn't spawn new auto sales. GM and Chrysler suffered 40% drops in sales. Ford only suffered a 5% drop. But you see, Cash for Clunkers was never designed to help the economy. It was designed to help bankers. Ben's friends. You see, (3 billion x the avg total selling price of a new car) 18 billion dollars in new car loans allows bankers to leverage 9 times that amount on loans. That friends, is fractional banking. They took your money (taxes) to repair (banks) broken balance sheets. They created about 200 billion dollars out of thin air with that single program.
But you see most people don't know that. They don't know that money is created when you take on debt. But Ben does. Cash for Clunkers did precisely what bankers wanted it to do. Help enrich themselves and repair their woefully broken balance sheets. At your expense.
You can't create wealth by giving it away. I'm pretty sure Warren Buffett would agree with me.
So today, we lost another 263,000 thousand jobs. Our real unemployment rate in the U.S. is over 17%. That's a fact. Not that ridiculous 9.8% figure created by government workers.
And I'll be damned if Frankenstein isn't running around claiming that stimulus has "saved" jobs. Millions of jobs. Frankenstein simply pulls that statement out of his ass and relies on our good nature to believe him. Because, in fact, we always do.
I am enjoying watching Frankenstein pillage our countryside. Why? Well, because I've seen this movie before and I know how it ends...that's why.