The long grind down debt lane continues.
For those with a memory (who took the rumblings of 2008 seriously) it seems that the world is an unreal place at present. The serious implications of too little to go around too many requires drastic action. Action which, unfortunately, central planners are incapable of making.
So far every move that has been actioned has been of kicking the can. As a number of wise financial bloggers state: ‘central planners (like the FED) have only one tool that they can use to attempt to fix the economy – to print money’. As true as this description seems, it is not without great sadness and disarray that such actions have consequences.
The consequences of which policy tools are played down by the MSM. In fact, the MSM are attempting to mislead the public at every step, citing one contradiction after another. It could be that they want to present a future which is rosier than it really is, in order to get the public in a more pro-active and productive mood. Maybe this works for a time. However, the longer this goes on the bigger the fallout between reality and the fictional world of stock market finance and central planners’ policies.
As I view the economy in London, UK – it is in these two rapidly disparate worlds.
One is the FTSE, the LSX with an ever increasing (or at least holding steady) value that keeps the stocks afloat and big business exchange rates at an equilibrium. FOREX and COMEX is being manipulated (with bonds and treasuries, SDR’s and LTRO’s for the FOREX – Naked shorts for the COMEX) The press publishes a new deal (such as FB buying Instagram) and an unknown company which suddenly lifts the stocks in the US (why? don’t ask – the lie is too complicated and incredibly boring) In this world, there is a recovery. The fundamentals are turned on their heads.
The other world is the real economy. Where people, shops and services indicate the general health of a nation or an economy. It has little to do with the stock market or the level of national debt. This world looks increasingly grim – with vacant shops increasing in numbers across London, large chains going into bankruptcy (such as GAME or Mothercare) and money being tight as shoppers buy just the essentials (luxury items are on sale in increasing numbers in the high street – the buyers are few and far between). The jobs market – another indicator of the real world – is filled with fictional positions. A number of people I know who are out of work are finding the same jobs being advertised months out of the closing date for applications. These are finance jobs and services jobs. Assuming that the company was offered a tax break for creating more UK employment (something we know happens) when the UK economy is so bad that these non-essential jobs are merely created to be placed in the jobs market as a teaser – we know the fraud has gone too far. This is where the market currently is.
A shocking parallel is Weimar Germany. An article illustrating the co-incidences between the US and the Weimar Republic can also be applied to the UK and Europe. As the stock market continues to increase in value, the real economy loses value. This is where we are heading – despite all the lies of a recovery and the promises of GDP growth projected into the future. I predict the central planners will deny reality even at the point when it takes them harshly by the neck and boots them out of their ivory towers. History has shown us these lessons many times before and it seems our current leaders are destined to repeat them.