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Chris Martenson

Mayday! Mayday!

This next story outlines a dire condition for a debt-based monetary system:

WASHINGTON (MarketWatch) – Stung by the loss of $2.81 trillion in their net wealth, U.S. households paid down their debts in the third quarter for the first time since at least 1952, the Federal Reserve reported Thursday.

As of Sept. 30, households’ total outstanding debt shrank at an annual rate of 0.8% from $13.94 trillion to $13.91 trillion, the Fed said in its quarterly flow of funds report. It’s the first decline in household debt ever recorded in the report.

Consumer debt actually reversed.   This strange behavior has never before been observed in this data series and it goes back to 1952.

Households pay down debts for first time

Mayday! Mayday!

This next story outlines a dire condition for a debt-based monetary system:

WASHINGTON (MarketWatch) – Stung by the loss of $2.81 trillion in their net wealth, U.S. households paid down their debts in the third quarter for the first time since at least 1952, the Federal Reserve reported Thursday.

As of Sept. 30, households’ total outstanding debt shrank at an annual rate of 0.8% from $13.94 trillion to $13.91 trillion, the Fed said in its quarterly flow of funds report. It’s the first decline in household debt ever recorded in the report.

Consumer debt actually reversed.   This strange behavior has never before been observed in this data series and it goes back to 1952.

As expected the employment report for November was bad having shed 533,000 jobs with unemployment advancing to 6.7%.

WASHINGTON (MarketWatch) – U.S. nonfarm payrolls plunged by an astonishing 533,000 in November, the worst job loss in 34 years, the Labor Department reported Friday.

It’s only the fourth time in the past 58 years that payrolls have fallen by more than 500,000 in a month. Since the recession began 11 months ago, a total of 1.9 million jobs have been lost.

But it would have been worse had it not been for the mysterious positive addition of 30,000 jobs by the so-called birth-death model.  From here on out we’ll just refer to it as the birth-birth model because no matter how bad the underlying economic data this model somehow always adds jobs in every month except typically January and July when the model backs out a few of its more irrationally exuberant additions.

Fuzzy Numbers: Jobs report bad at minus 533,000, but made to look better

As expected the employment report for November was bad having shed 533,000 jobs with unemployment advancing to 6.7%.

WASHINGTON (MarketWatch) – U.S. nonfarm payrolls plunged by an astonishing 533,000 in November, the worst job loss in 34 years, the Labor Department reported Friday.

It’s only the fourth time in the past 58 years that payrolls have fallen by more than 500,000 in a month. Since the recession began 11 months ago, a total of 1.9 million jobs have been lost.

But it would have been worse had it not been for the mysterious positive addition of 30,000 jobs by the so-called birth-death model.  From here on out we’ll just refer to it as the birth-birth model because no matter how bad the underlying economic data this model somehow always adds jobs in every month except typically January and July when the model backs out a few of its more irrationally exuberant additions.

Bernanke’s remarks today did little to soothe this ruffled observer.  His remarks struck me as practically dishonest in their inability to speak directly to our actual problems. 

Bernanke says Fed still has arrows in quiver
WASHINGTON (MarketWatch) – The Federal Reserve has lowered interest rates just about as far as they can go, but the U.S. central bank still has plenty of available firepower it could deploy to restore financial markets to normal, Fed Chairman Ben Bernanke said Monday.

I wish that we could just get some straight talk about our actual condition, instead of this weird insistence on "restoring our financial markets to normal."  This ignores the fact that they were completely abnormal.  Why would we want to return there? I guess it’s this strange insistence on continually repeating the mantra that things can be "restored to normal" that’s got me unsettled. 

The way I see it, there’s no "normal" to return to.  Things were hopelessly out of whack before, and now they will settle into some new, different level of activity.  

George Soros refers to this same process in his Theory of Reflexivity, arguing that the mainstream economic insistence that there is some sort of magic equilibrium is utterly without merit.  Instead, markets reflect the interplay between human perceptions and reality.  So there’s no such thing as "equilibrium."  Everything is constantly in flux.  

Bernanke – Still speaking as though to children

Bernanke’s remarks today did little to soothe this ruffled observer.  His remarks struck me as practically dishonest in their inability to speak directly to our actual problems. 

Bernanke says Fed still has arrows in quiver
WASHINGTON (MarketWatch) – The Federal Reserve has lowered interest rates just about as far as they can go, but the U.S. central bank still has plenty of available firepower it could deploy to restore financial markets to normal, Fed Chairman Ben Bernanke said Monday.

I wish that we could just get some straight talk about our actual condition, instead of this weird insistence on "restoring our financial markets to normal."  This ignores the fact that they were completely abnormal.  Why would we want to return there? I guess it’s this strange insistence on continually repeating the mantra that things can be "restored to normal" that’s got me unsettled. 

The way I see it, there’s no "normal" to return to.  Things were hopelessly out of whack before, and now they will settle into some new, different level of activity.  

George Soros refers to this same process in his Theory of Reflexivity, arguing that the mainstream economic insistence that there is some sort of magic equilibrium is utterly without merit.  Instead, markets reflect the interplay between human perceptions and reality.  So there’s no such thing as "equilibrium."  Everything is constantly in flux.  

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