Good Morning Middle America, your King of Simple News is on the job.
U.S. NEWS: Financial news yesterday displayed the joke of the day with the following headlines:
- Celent: 200,000 US Banking Jobs at Risk- AP
- Manufacturing, Construction Weaken- AP
- Ford, Toyota US Sales Down in March- AP
- Goldman Analyst Expects More Write-Downs- AP
- UBS Will Write Down $19 Billion- AP
- Wall Street Castles Made of Sand- Tech Ticker
Just above these headlines, the main header title was, Stocks Surge to Start Q2!
As Larry the Cable Guy says, "Now that there's funny, I don't care who you are."
And, stocks really did surge, with the DOW rising nearly 400 points. Imagine how high the markets may have gone if for instance, Celent (a research firm) would have had some good news such as "Only 100,000 U.S. Banking Jobs at Risk." There's no telling how far these markets could soar if the bank had only written off $10 Billion.
So why are the markets up with all of this bad news? Several reasons, one is that many people were expecting the headlines to read, "America is broke and everyone is going to die." What we have here is comparable good news.
Interpretation is the key. What the news really said is that "America is broke and half of the people are going to die." Most people just assume that they are in the half that isn't going to die and therefore, "Mary, I just read where the neighbors on both sides of us are going to kick the bucket."
Since we are already in la-la land, let's talk about Hillary Clinton. The good Senator is promising the people in the industrial mid west that she will bring back the jobs. Now, those people in the mid west surely know that Mr. Clinton ushered in both NAFTA and the WTO, which allowed their jobs to migrate to other countries. So why would they back Mrs. Clinton?
They do so because Mrs. Clinton is lying and the other candidates aren't lying as much. That's how we chose presidents in the U.S. Those who promise the most and demand the least...win.
The U.S. is passing into the most difficult economic times that I can recall, including the lead up the Great Depression. We often talk about 1929 and the Great Depression, but dismiss the possibility of such and event occuring again. How many times have you heard someone say, "We have checks and balances now to prevent a reoccurrence of 1929."
And we do; it's being played out for all it worth right before your eyes. In 1929, we would have been well into a depression at this point. But not now, the Fed is rescuing investment banks that took near criminal liberties with their investors' money. They had loaned out some 30-1 of their deposits on shaky collateralized debt instruments. In other words for every dollar that they actually held, they loaned thirty.
While they were doing so, the CEO's were literally making millions in bonuses as were the employee's. And now, King George and the Congressional Jesters are suggesting that the Fed have more oversight and power, the same Fed that brought us this entire mess.
Wake up Middle America, more government is not the answer and Ron Paul is getting smarter every day.