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Rail Traffic Has Fallen Off the Tracks


2 Comments in Response to

Comment by Found Zero
Entered on:

Here's another one. We know the talking heads keep telling us to get back into the stock market and bla de bla de bla. But how does anyone even know what the stock market is anymore?

It used to be about like....investing in companies you thought would be successful or something. Back when they recorded trades with sticks and rocks or something and people used sea shells for money.

Now it's about margin calls and computer trading and shorts and really short shorts and naked shorts and naked girls in shorts or whatever. No real value is getting put into real companies that produce real things that real people want to buy. With seashells or whatever. The stock market has become about betting on which companies or industries are getting bailed out. Who's "too big to fail" now? Who's gonna jump on the federal band wagon next? That's where the money is going.

This isn't a market. This isn't even an economy anymore. What this is is an engine that stopped running but nobody thought to hit the brakes. We're basically rolling by sheer innertia right now. All this Fed throwing money around is having NIL effect in the "real" economy as far as I can see. The job numbers, the real ones we cruch are staggering. But if you don't like numbers, look at it this way. We're right up around Spain in terms of unemployment. This is bad, this is really bad. It's worse because we basically don't have viable industries to employ people any more. We're a consumer nation not a producer nation now.

We are going to see this in terms of child malnutrition soon. We're going to see this in mortality figures in the old and the young.


Consider ye the lillies of the field; they sow not nor do they reap. Yet Solomon in all his glory was not arrayed like one of these. Lucky freaking lillies.

Comment by Found Zero
Entered on:

Rail traffic goes off the tracks and ultimately I think it will take the deflationists like Mish with it. And Mike Whitney. Especially Mike Whitney.

Mish at least can clinically see deflation as contraction of credit/money supply but him and especially Whitney still tend to confuse this with "falling prices for commodities" which is just too simplistic for today's manipulated market.

We saw this all coming when the BDI numbers went haywire about 6 months ago. Profitability in international shipping essentially went negative. Now you can consider this simplistic, but in a global consumer good society, when profitabilty in shipping goes DOWN, you can expect expenses to go UP. Ultimately, you can expect SCARCITY of that which used to be ABUNDANT.

Extending this, as global production downscales to meet reduced demmand, once back inventory is reduced, you can expect to see prices go UP. So far this has little to do with money supply, it's a demand driven thing. Or non-demand, take your pick. But this much is purely mechanical.

Beyond this, what the deflationists seem to understand is much of the invented "stimulus" money didn't make it into our economy but was rather spent into the global economy, or it doesn't enter the "real" economy at all. The lavish payouts to the lucky Goldman boys are a drop in the bucket after all. And for once, I think they might just have a point. Us Austrians know beyond a shadow of a doubt that a while poop pile of liquidity just got pumped in which we know, we KNOW is inflationary but what if nobody even knows, what if the economy essentially doesn't even know where all that money went? After all, on who's balance sheet does it show? Not even the Fed can tell us. Where is it? Where did it go?

That's a head scratcher Mish et all can pretend to know but I don't think any of us do.

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