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Economy
Economy
by
JW
by
Gregor Macdonald
Executive Summary
- Why household balance sheets are worse off than advertised
- Why the recent rosy BLS jobs numbers actually mean bad news
- How the Fed is squeezing investor capital out of other traditional asset pools and into the stock market
- Expect to see the stock market moving higher in 2013; that is, until QE3 fails
- What to expect if QE3 fails sooner than anticipated
If you have not yet read Part I: The Future of Gold, Oil & the Dollar, available free to all readers, please click here to read it first.
Market historians have recently started to point out that the current advance in the S&P500 is now 40 months old and has made gains of over 115% since the March 2009 lows. In other words, the doubling from the lows in price and the duration of the advance now late in its third year together suggest that a cyclical top is near. Furthermore, despite some noise in U.S. macro data – which has been briefly more hopeful, yet remains well within the phase of stagnation – earnings estimates have been coming down as the world economy continues to shift into lower gear.
Perhaps for the first time in a while, we can actually say that the Fed's decision to start QE3 was moderately anticipatory, in contrast to its ad-hoc and reactive policymaking over the past five years. It is not merely that the Fed soberly accepted that the economy was not getting better. The stagnant, tractionless macro data over the past year has spoken quite loudly to that fact. Indeed, the U.S. economy is merely treading water, and the Fed's move to QE3 serves as a sharp retort to those who would relentlessly attempt to portray stagnation as recovery.
Where Stock Prices Are Headed Over the Next Year
PREVIEW by Gregor MacdonaldExecutive Summary
- Why household balance sheets are worse off than advertised
- Why the recent rosy BLS jobs numbers actually mean bad news
- How the Fed is squeezing investor capital out of other traditional asset pools and into the stock market
- Expect to see the stock market moving higher in 2013; that is, until QE3 fails
- What to expect if QE3 fails sooner than anticipated
If you have not yet read Part I: The Future of Gold, Oil & the Dollar, available free to all readers, please click here to read it first.
Market historians have recently started to point out that the current advance in the S&P500 is now 40 months old and has made gains of over 115% since the March 2009 lows. In other words, the doubling from the lows in price and the duration of the advance now late in its third year together suggest that a cyclical top is near. Furthermore, despite some noise in U.S. macro data – which has been briefly more hopeful, yet remains well within the phase of stagnation – earnings estimates have been coming down as the world economy continues to shift into lower gear.
Perhaps for the first time in a while, we can actually say that the Fed's decision to start QE3 was moderately anticipatory, in contrast to its ad-hoc and reactive policymaking over the past five years. It is not merely that the Fed soberly accepted that the economy was not getting better. The stagnant, tractionless macro data over the past year has spoken quite loudly to that fact. Indeed, the U.S. economy is merely treading water, and the Fed's move to QE3 serves as a sharp retort to those who would relentlessly attempt to portray stagnation as recovery.
by
Gregor Macdonald
The ability of reflationary policy to mute the worst risks of debt deflation has been a source of enormous frustration for stock market bears ever since the 2008 collapse. Yes, the initial moderate rally out of the S&P500’s black hole was perhaps not so surprising in 2009. Bombed-out stock markets can always manage some sort of rally. But the ability of the rally to continue through 2010, and then 2011, and now 2012 has been quite vexing and painful for bearish investors.
Indeed, the entire post-2008 market phase has now produced an era of consistently poor performance for hedge funds. Recent data, for example, shows that an incredible 90% of hedge funds are underperforming the S&P500 through mid-September.
Will the pain continue?
The Future of Gold, Oil & the Dollar
by Gregor MacdonaldThe ability of reflationary policy to mute the worst risks of debt deflation has been a source of enormous frustration for stock market bears ever since the 2008 collapse. Yes, the initial moderate rally out of the S&P500’s black hole was perhaps not so surprising in 2009. Bombed-out stock markets can always manage some sort of rally. But the ability of the rally to continue through 2010, and then 2011, and now 2012 has been quite vexing and painful for bearish investors.
Indeed, the entire post-2008 market phase has now produced an era of consistently poor performance for hedge funds. Recent data, for example, shows that an incredible 90% of hedge funds are underperforming the S&P500 through mid-September.
Will the pain continue?
by
JW
With up to 40% of food being wasted in the US – learning how to make better use of and utilize our hard-grown food is an important resiliency skill to acquire. Reducing the food waste stream will hopefully reduce our energy use as well.
http://eartheasy.com/blog/2012/05/5-simple-ways-to-reduce-food-waste/
5 Simple Ways to Reduce Food Waste
by JWWith up to 40% of food being wasted in the US – learning how to make better use of and utilize our hard-grown food is an important resiliency skill to acquire. Reducing the food waste stream will hopefully reduce our energy use as well.
http://eartheasy.com/blog/2012/05/5-simple-ways-to-reduce-food-waste/
by
charleshughsmith
Executive Summary
- Why buying into the Status Quo undermines personal empowerment
- Echew debt and consumerism. Instead, focus on cultivating resilience and social capital
- The importance of differentiating hedonia vs eudaimonia
- The key roles of Expectation, Narrative, and Challenge
- The foundations of happiness
If you have not yet read Part I: The Pursuit of Happiness, available free to all readers, please click here to read it first.
In Part I, we challenged the assumption that the successful pursuit of happiness is based on material prosperity and what we might call the psychology of the atomized individual.
If material prosperity is necessary but insufficient, and our social and financial order is sociopathological, what does an authentic pursuit of happiness entail?
For answers, we can survey recent research into human happiness, and consider “powering down” participation in a deranging social and financial order.
Pondering Power
The primacy of power in human society is omnipresent. Humans scramble for power in all its forms to improve social status and the odds of mating, living a long life, and acquiring comforts. What is remarkable about the current American social order is the powerlessness of the vast majority of people who have “bought into” the Status Quo.
When the public vehemently disapproves of a policy, such as bailing out the “too big to fail” banks, they are routinely ignored, and for good reason: They keep re-electing incumbents. Most have little control over their employment status, workflow, or income, and most devote the majority of their productive effort servicing private debt and paying taxes that service public debt.
The one “power” they are encouraged to flex is the momentary empowerment offered by purchasing something; i.e., consuming. The corporate marketing machine glorifies acquisition as not just empowering but as the renewal of identity and the staking of a claim to higher social status – everything that is otherwise out of the control of the average person.
The dominant social control myth of our consumerist Status Quo is that wealth is power because you can buy more things with it. But the power of consumption is one-dimensional and therefore illusory. The only meaningful power is not what you can buy – a good, service, or experience – but what you control – your health, choice of work, income, surroundings, level of risk, and your circle of colleagues and friends.
The “wealthy” who own an abundance of things but who are trapped in debt are not powerful. Their choices in life are limited by the need to service the debt, and their pursuit of happiness is equally constrained.
The kind of wealth that enriches the pursuit of happiness is control over the meaningful aspects of life. It is no coincidence that studies of workplace stress have found that those jobs in which the worker has almost no control over their work or surroundings generate far more stress than jobs that allow the worker some autonomy and control.
Financial and material wealth beyond the basics of creature comfort is only meaningful if it “buys” autonomy and choice.
We all want power over our own lives. Once we free ourselves from social control myths, we find that becoming powerful and “wealthy” in terms of control does not require a financial fortune. It does, however, require sustained effort and a coherent long-term plan…
Finding Authentic Happiness
PREVIEW by charleshughsmithExecutive Summary
- Why buying into the Status Quo undermines personal empowerment
- Echew debt and consumerism. Instead, focus on cultivating resilience and social capital
- The importance of differentiating hedonia vs eudaimonia
- The key roles of Expectation, Narrative, and Challenge
- The foundations of happiness
If you have not yet read Part I: The Pursuit of Happiness, available free to all readers, please click here to read it first.
In Part I, we challenged the assumption that the successful pursuit of happiness is based on material prosperity and what we might call the psychology of the atomized individual.
If material prosperity is necessary but insufficient, and our social and financial order is sociopathological, what does an authentic pursuit of happiness entail?
For answers, we can survey recent research into human happiness, and consider “powering down” participation in a deranging social and financial order.
Pondering Power
The primacy of power in human society is omnipresent. Humans scramble for power in all its forms to improve social status and the odds of mating, living a long life, and acquiring comforts. What is remarkable about the current American social order is the powerlessness of the vast majority of people who have “bought into” the Status Quo.
When the public vehemently disapproves of a policy, such as bailing out the “too big to fail” banks, they are routinely ignored, and for good reason: They keep re-electing incumbents. Most have little control over their employment status, workflow, or income, and most devote the majority of their productive effort servicing private debt and paying taxes that service public debt.
The one “power” they are encouraged to flex is the momentary empowerment offered by purchasing something; i.e., consuming. The corporate marketing machine glorifies acquisition as not just empowering but as the renewal of identity and the staking of a claim to higher social status – everything that is otherwise out of the control of the average person.
The dominant social control myth of our consumerist Status Quo is that wealth is power because you can buy more things with it. But the power of consumption is one-dimensional and therefore illusory. The only meaningful power is not what you can buy – a good, service, or experience – but what you control – your health, choice of work, income, surroundings, level of risk, and your circle of colleagues and friends.
The “wealthy” who own an abundance of things but who are trapped in debt are not powerful. Their choices in life are limited by the need to service the debt, and their pursuit of happiness is equally constrained.
The kind of wealth that enriches the pursuit of happiness is control over the meaningful aspects of life. It is no coincidence that studies of workplace stress have found that those jobs in which the worker has almost no control over their work or surroundings generate far more stress than jobs that allow the worker some autonomy and control.
Financial and material wealth beyond the basics of creature comfort is only meaningful if it “buys” autonomy and choice.
We all want power over our own lives. Once we free ourselves from social control myths, we find that becoming powerful and “wealthy” in terms of control does not require a financial fortune. It does, however, require sustained effort and a coherent long-term plan…
by
JW
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