Forecasts of a Doomed Economy

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Regulations Harm Small Business and Protects Corporations
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Money Center Banks and Stricter Financial Oversight
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Unemployment as a Lifestyle
Immigration Hurts American Employment
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Parking Offshore Profits Hurt the Domestic Economy
The Record of Olympic Economics
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Destroying Internet Freedom by Taxation
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Jackals of Jekyll Island - Federal Reserve Audit
QE3 Blowing Up the Debt Bubble
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Gap Between College Costs and Inflation
Counterproductive Minimum Wage Mandates
Derivative Meltdown and Dollar Collapse
Central Banks Game Plan: One World Currency
European Commission Single Supervisory Mechanism
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Taxmageddon Holding Hands while Jumping Off the Cliff
The Direction of Equities in the Obama Economy
Is it FAIR to Tax the Rich out of Business?
California Dreaming: Bankruptcy, Pensions and Taxes
Pay Differential - Private Sector and Federal Government
Long History of HSBC Money Laundering
Swan Dive of 2013 Economy
Federal Reserve May Pause Quantitative Easing
The Economics of Sequestration
The state-owned Bank of North Dakota
Chinese Takeover with Free Trade Zones
Low Interest Rates Impoverish Savers
Bond Bubble Expectations
Currency Wars - Race to the Bottom
Government Subsidizes and Bankrupt Companies
Economics of Gun Control
Refuse to Buy or Sell with the Federal Government
The Cyprus Great Bank Robbery
Keystone Pipeline Blockage
Move Over IMF for the BRICS Development Bank
Obama Budget Proposes Cuts to Social Security and Medicare
The Risk and Reward of Bitcoins
Farm Supports and Social Welfare
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IRS as a Political Hit Squad
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Google and the NSA Connection
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Hydrofracking Boom or Bust
Goldman Sachs - first learn, then earn and serve
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Implications of a Pyrrhic Real Estate Rebound
The New Normal: Part-Time Employmentyment
U.S. & Europe Trade Deal Honeymoon
Detroit City Bankruptcy Blues
J P Morgan and Commodity Manipulation
Strange Business Success Ventures
Business of Evangelism Religion
NFL Marketing Machine
Privacy Gone on Offshore Assets
Chinese Banks Quasi Government Institutions
Forecasts of a Doomed Economy
Financial Meltdown Five Years After
Corporate Profits and Worker Unemployment
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Rehypothecation of Collateral
IMF Proposal to Tax Bank Deposits
Transfers excluded, JP Morgan Chase is Wired
Insurance Companies Profit from Obamacare
Climate Change by Executive Order
Economics of Non-governmental Organizations
Why Business Franchising is a Bad Deal
The Business of the Christmas Season
China Becomes Largest Trading Nation
Obamacare as a Jobs Killer
Does a 100 Trillion Debt Total Matter?
Underground Commerce is the Real Economy
Technology and the Future of Jobs
The Japanese Debt Economy
Individual Wealth in Perspective
Inevitability of Financial Bubbles
Russian Sanctions Backfire
Is the Dollar and Equities Ready to Crash?
Economic Reality of a Wealth Tax
How stable is the Bond Market?
Are International Stocks Safer than U.S. Equities?
David A. Stockman - The Great Deformation
Chinese and Japanese Deflationary Economies
Euro Crisis Deepens
Russia's SWIFT Settlement Alternative
The Swiss will not have more EU QE
Business of Global Warming Fraud
Economics of NYS Southern Tier Secession
Fear of IRS Tax Audits Diminish
Where is Global Economic Growth?
Government's share of minimum wage increase
Economic Growth Is Impossible
Replace the Business Cycle with Permanent Poverty
Who benefits from the lifting of Iranian sanctions?
Who Wins in a Currency Devaluation War?
Labor Day when there is no work
Municipal Bankruptcies and more on the way
Undeniable Social Security Demographics
Grinch that stole Christmass
Business Mergers Soar in 2015
The Chinese Market Crash
Driverless Vehicles Powered by Artificial Intelligence
U.S. Banks Ready for Negative Interest Rates?
International Trade Sinks with the Baltic Dry Index
SunEdison Green Power Bankruptcy Inevitability
Another Record Collection from Federal Taxes
Absurd Valuations on Unprofitable Tech Stocks
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Forbidden History
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Stuck on Stupid
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Inherent Autonomy
Radical Reactionary
Strappado Wrack
View from the Mount
Solitary Purdah
Dueling Twins
Varying Verity
911 War of Terror


Forecasts of a Doomed Economy

Contrary investing used to be a profitable endeavor. Things have changed. The doom business is in full swing as many financial prognosticators seek to hedge their normally ecstatic outlooks in order to sell their advice. When tragedy becomes a consensus sentiment, it used to be the time to buy. Now that formula has to factor in a different set of risks. Namely the incoherent political intrusions and stimulus-austerity gyrations has to head the list. Has forecasting become a lost art or did it evolve into an algorithm supercomputer project? In either case, the doom factor is sure to continue to be a stable from the Cassandra circle as long as an economic recovery allures the former members of the middle class.

Nevertheless, the bulls want you to believe that economic indicators are guardedly improving.
The Global Economic Intersection boldly portends.

"Our September 2013 Economic Forecast shows a change of trend. Many portions of our economic model started to expand over the previous month’s baseline.

We continue to warn that consumer spending increases are expanding at a much faster pace than income – and that eventually either a jump in income or a fall in consumption must occur to close this gap. This remains an economic headwind for 3Q2013."

Surely, equities are back in vogue as spending flows. Yet, Tom Stevenson writing in The Telegraph recommends
Take forecasts with a pinch of salt...or move to Omaha, for those who have the courage to bet their money on picking particular stocks.

"The problem for investors is that very often, at the individual stock level, good news is not built into valuations for some time after it has become publicly available.

This means that contrary to markets as a whole, where it can be better to travel than to arrive, good company news can trigger sustained outperformance as investors slowly accept the improved outlook.

This might sound like a counsel of despair for investors, but it shouldn't. Awareness of the limitations of knowledge is actually strangely liberating when it comes to managing your investments."

Woe is me, what opportunities are missed by sitting on the sidelines? Almost moves one to subscribe to some of those pricy newsletters. But before you brush off the dust on your wallet, heed the lesson that Ian R. Campbell references when he asks Economic forecasting – how credible?

"Frequently in this Newsletter I have said I believe that many economists wrongly advance a theoretical forecast framework based on irrelevant history when reaching conclusions on what is prospectively going to happen in any particular economy at any given point in time – and hence many economists inherently are doomed to get things wrong before they put pen to paper."

The prediction record of most experts is dismal at best. Therefore, when Charles Colgan, former chair of Maine’s Consensus Economic Forecasting Commission is cited in
On economic forecasting as a ‘forlorn hope’. He "humbly admitting he’s botched the past several annual forecasts, Colgan compared himself to Charlie Brown, ever the optimist, who repeatedly tries to kick the football being held by his friend Lucy."

Yes, the small investor is just as dimwitted as Charlie Brown. The fate of most plays in the M A R K E T S, are sealed before they get started. In a corporatist economy, the balance sheets of companies swell, but the return on equity to stockowners often falls short.

One needs to admit, before placing funds in the hands of Wall Street money managers, that the game is speculation, not investing. Fortunes are made by knowing the insider decisions before the public is even aware of the news that a stock is in play. Even bigger sums are extracted from shorting a vulnerable public company as the vultures sense a ripe carcass.

Any thinking citizen with even a modest understanding of economics and commerce must conclude that the consumer patience is still gravely ill. Sophistication in interpreting trend forecasts is not necessary when CNNMoney provides the evidence. "The average age of vehicles on America's roads has reached an all-time high of 11.4 years, according to the market research firm Polk. And that average age is sure to keep climbing, the firm said."

If the financial sages deem the consumer superfluous and define a healthy economy by a growing public sector, the prospects for a doomed system are inevitable.

For those who reject this analysis and want to be informed about the latest perspective from The Economist, signup for the Global Forecasting Service. Get unrestricted access to full, updated and interactive coverage of our world economic outlook, including projections of key indicators and analysis of developed and emerging markets.

Reading such international financial establishment pronouncements usually provide a reassuring crutch even when countries are going bankrupt. Telling as it is for the spin you are meant to accept, the forecast for personal success in the investment jungle is wrath with predators of all species.

Now all this caution is moot if the global economy enters into a new golden age. Duplicating the prosperity of the industrial revolution with a cyber collection matrix that digitally spies on propitiatory business secrets is not exactly the formula that generates wealth, which is shared by the masses.

The incomparable Paul Craig Roberts is the best political and economic forecaster. In his 2011 article, How the Economy was Lost, Doomed by the Myths of Free Trade, he explains the basic reason for the doomed forthcoming financial meltdown end game.

"As the issuers of swaps were not required to reserve against them, and as there is no limit to the number of swaps, the payouts could easily exceed the net worth of the issuer.

This was the most shameful and most mindless form of speculation. Gamblers were betting hands that they could not cover. The US regulators fled their posts. The American financial institutions abandoned all integrity. As a consequence, American financial institutions and rating agencies are trusted nowhere on earth."

This is the forecast that you can bank on.

James Hall – September 11, 2013

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