Chris Martenson

There were a couple of questions concerning the last blog post about the GDP that I would like to address.

Here’s the first one from willid3:

I wonder if the explanation for PCE and why corporate profits are down is that the vast majority of all income in the US is earned by the top 1 percentile of incomes. and by far they are the least likely to have been layed off. and the reason corporate profits are down, is that most corporations get profits based on volume, and thats based more on the lower 95 percentile of incomes. Who are the ones who are having trouble keeping their jobs, and whose incomes have been cut the most

First, it is important to note that I only made a claim about corporate revenues, not profits.  Corporate revenues are like your base salary, in full, while corporate profits are what’s left over after taxes and all legitimate expenses are deducted.

In the parlance of accounting, revenues are called "top line" results and profits are called "bottom line."    Into the top line goes everything that resulted in a cash transaction for your company.  Who owns the profits and how they are distributed are immaterial to the argument I laid out in the prior blog article which was that Personal Consumption Expenditures measure all the things that people buy and, as far as I can tell, people usually buy stuff from companies.

Which brings us to the second question.

The following is an addition to the In Session thread made today (available to all enrolled members).

I want to comment on the notion of market manipulation, which I have hinted at recently.  What does this mean, "manipulation?"  For me, the definition is "moving markets in a given direction for overt political or financial gain for a relative few in opposition to basic fundamentals."

There’s lots of evidence, both direct and indirect, to support the notion that our "markets" are not really markets at all, but rather subject to non-economic forces producing something other than "orderly price discovery."

Here’s a prime example from yesterday:

Last night, in Boulder Colorado, I had the honor to present a one-hour mini version of the Crash Course to an audience that I estimate to be in the vicinity of 300+. Sponsored by Transition Colorado, who did a remarkable and professional job of organizing and managing the event, this talk was attended by more young people than any other talk I have given.

This was extremely heartening.

Dr. Albert Bartlett was in attendance, which was a great honor for me, although I confess to being nervous at the thought of covering exponential growth with him in the audience. It seemed kind of like giving meditation advice to the Dali Lama. Nonetheless, I now have a picture of myself with a man who I am sure will be recognized through time as being both right and unwavering in his views on exponential growth and population.

At the talk, I necessarily had to gloss over some important details, and one of those concerned the statement that “The United States is Insolvent.”