The Ghost of History

China Ghost City

The talking heads on the financial channels are blaming China for the recent downdraft in the stock market. China is a real problem; a ticking time bomb.  However, this is not new. They manipulate their numbers, and do not operate efficient markets based on supply and demand principles. China has several ghost cities, for crying out loud, which are well known and truly stunning.

It is the mess created by the US government, with complicit partners on Wall Street and in the mainstream media, that has placed America and her finances in peril.  Every decision that was made in the aftermath of the 2008 financial crisis was in error, and eroded liberty and freedom for all. Once such action was extending the unemployment coverage for longer periods of time. As famed author Art Laffer once quipped, "when you people not to work, don't be surprised if get a lot of people not working." Got it.

Speaking of the job market, investors hope a strong jobs number Friday morning will held turn the market tide.  But that is a manipulated number as well, as it captures only those who have recently sought full employment, not the high number of those who have given up.  In fact, if the job market was improving, you would see a slight increase in the unemployment rate, as more individuals would enter the capsule of those actively seeking work. The most accurate indicator of the job market can be found in the labor participation rate, painting a dismal snapshot in time sunk at level not seen since the days of Jimmy Carter over 35 years ago.

It is noted that it is most difficult to find any market indicator not flashing a high level of caution. The following excerpt from an excellent piece from Jim Quinn over at The Burning Platform, "Corporate profits are plunging. Labor participation continues to fall. A global recession is in progress. The strong U.S. dollar is crushing exports and profits of international corporations. Real household income remains stagnant, while healthcare, rent, home prices, education, and a myriad of other daily living expenses relentlessly rises. The world is a powder keg, with tensions rising ever higher in the Middle East, Ukraine, Europe, and China."

The experts always claim this time it is different; nothing but financial folly. As noted in the piece, "The reckless herd has been in control for the last few years, but their recklessness is going to get them slaughtered. The lessons of history scream for caution at this moment in time, not recklessness." True.

We warned about the economy and capital market months ago, and our position has not changed. Once again, this time isn't different.

The ghosts know.

 Please see  THIS TIME ISN'T DIFFERENT by Jim Quinn over at The Burning Platform.