Not Many Positive Indicators

In order to report a decrease in initial jobless claims, last week’s claims had to be revised upward.  My guess is that this week’s claims will be revised upward next week.  It would break a pattern if that were not the case.  The unemployment rate, even the official one, is likely going to rise a little, probably back to 8.5%.  What does not seem to be in the news is an “unexpected” fall in existing home sales and a less than stellar Spanish bond auction.

We have a soft employment picture.  We have warnings in the telecommunications area and the sectors that support telecomm production, indicating that growth in smart phones might be leveling off.  There is still no help from housing.  If you can’t sell existing homes, you can’t build or buy new ones.  The euro is teetering.  Soros is pushing a collapse in Europe, claiming he would be shorting the euro if he were still trading currencies [insert eye-roll here].    Copper is down quite a bit -- $3.63 from $3.92 or more just a couple of weeks back it seems.  The linked article suggests that China’s copper stockpiles are up.  I wonder if that is in anticipation of something or if it is due to a decrease in demand?

Bernanke is looking for an excuse to roll the presses.  The slippage in growth plus the rise in unemployment may be just what he needs to cover a big buy of Treasuries.  I think the banks have been picking up about 61% of the recent U.S. bond sales.  China is less interested.  In addition to suffering from the overall global recession, they have internal problems.  

Deutsche Bank thinks all may not be well.  The problem is that all the rescue money has been spent, yet the end is not in sight.  Defaults are looming, and no more bailouts are expected.

I have no idea what is going to happen or what the time frame of a serious downturn might be.  I do not see how it is possible to push this too much further.  

One of the foundations of conspiracy theorizing is that out there somewhere is a small group of really powerful people who not only can do whatever they want, but that know the consequences of what they are doing.  

Think about that for a minute or two, and you may see why I have so much trouble believing in conspiracies.  Most people, even very influential, very wealthy, very powerful people are, by any measure, not much more intelligent than I am.  This is to say, not that I am a genius but, that I am above average in intelligence, not a lot, but enough that most people are not any smarter than I am.  They may have connections that I don't have.  They may have resources I don't have.  They may have knowledge, skills, talents, and techniques that I don't have.  Anybody who has ever heard Warren Buffet speak knows he is a fairly bright man but hardly a genius.  He knows a lot about making money, but he's certainly no polymath.  

Remarkably average is a valid description of most politicians -- though there does exist a significant minority of the incredibly stupid.  None of these people, singly or in aggregate, are capable of running the world or a free market.  That includes the Chinese, the Japanese, and the Europeans.  Planned and centrally controlled economies never work.  They have never worked in history, and they are not going to work in the future, and they are not working now.  The proof is the current global financial situation.  

 Free markets go awry now and then and cause hardships, but they correct themselves before causing catastrophic collapses.  That is not what is happening now.