02/08/10 Baltimore, Maryland – There was a storm raging on Wall Street too. And by the end of the day, traders, investors and speculators probably wished they had stocked more alcohol for the weekend.
The Dow was up 10 points. After being down 100 points. Gold fell $10.
“Clearly we have entered the worry, fear camp,” said one pro.
Unfortunately, today’s action was not as clear-cut as we would like. There was no bounce back. And no further decline. Our guess is that stocks will probably trend downward for a long time. Most likely, the long-awaited – at least by us! – resumption of the bear market has begun. We’ve had our crash. We’ve had our bounce. Now, we’ll take the long slide down to the ultimate, final, this-is-where-it-stops end.
Listening to the radio this morning, the announcer told us that only “essential” government employees had to report for duty this morning. We wondered if any of them really were essential. Surely, not the fellows who are watching after the African horned beetle. Surely, not the ones who are designing a new health care overhaul for the nation. Surely, not the ones who are coming up with a revision to subsection 4.503.02 of the Internal Revenue Code dealing with unlicensed backdated further codicils of provisions dealing with gifts to one-armed wonton turners who are beneficiaries of insurance policy proceeds upon which sufficient basis has been revoked because they failed to read the fine print. Or something like that.
Take out all the non-essential federal employees? Who’s left?
Anyone? Probably a couple guys in the Pentagon who make sure the Canadians are not amassing troops on the border.
But that is another subject, isn’t it? Not exactly. The federal payroll is the only payroll in the nation that is expanding. Government is a growth industry. Just about everything else is in decline.
Wait. The latest number from the feds tells us that joblessness declined by 0.3% last month. Do you believe that, dear reader? Where’s the SEC when you need it? Aren’t the feds misleading investors – intentionally?
There was another ad on the radio this morning asking for census takers. More federal employees! Why not get the non-essential employees to count people?
We don’t have a separate count, but we wouldn’t be a bit surprised to find that the feds’ unemployment number hides as much as it reveals. After all, as near as we can tell, we’re still in a period of private sector de-leveraging. That means fewer jobs. The mistakes of the bubble era must be un-done. Jobs must be eliminated. And employment won’t rise again until the private sector can find ways to put people back to work at a profit.
But how?
Bill Bonner
Since founding Agora Inc. in 1979, Bill Bonner has found success and garnered camaraderie in numerous communities and industries. A man of many talents, his entrepreneurial savvy, unique writings, philanthropic undertakings, and preservationist activities have all been recognized and awarded by some of America's most respected authorities. Along with Addison Wiggin, his friend and colleague, Bill has written two New York Times best-selling books, Financial Reckoning Day and Empire of Debt. Both works have been critically acclaimed internationally. With political journalist Lila Rajiva, he wrote his third New York Times best-selling book, Mobs, Messiahs and Markets, which offers concrete advice on how to avoid the public spectacle of modern finance. Since 1999, Bill has been a daily contributor and the driving force behind The Daily Reckoning. Dice Have No Memory: Big Bets & Bad Economics from Paris to the Pampas, the newest book from Bill Bonner, is the definitive compendium of Bill’s daily reckonings from more than a decade: 1999-2010.
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“Listening to the radio this morning, the announcer told us that only “essential” government employees had to report for duty this morning.”
So Harry won’t be checking in today on account of a snow day?
Harry and I are too busy PARTYING with proceeds from all those cheap stocks we loaded up on.
DOW zoomed from 10,680 to 9908!
AAPL went up from 215 to 194!
GS up from 173 to 151!
GE up from 17 to 15!
The sky is the limit! This particular batch of white lightning Harry and I shared was awesome as well.
Well the DOW dropped about 100 today to finally close below 10K for the first time since November. And I’m thinking that I might work part time for the Census, an evening or two, or maybe a weekend day, going door to door to earn some extra money–I can save it or pay off a debt or maybe just consume with it! Here in my town the pay for the census is $17.85/hr.
Now Now; Undoubtedly there are a lot of things gov’t does that we can really do without.
But, yes there are things gov’t does that are important to everyone, courts, DAs, police, fire, water works, sewage, garbage come to mind. And there are others.
I’m not sure we’d want to see what happens when the “essential” part gets toasted. Given current budget circumstances, it will happen sooner or later, and it won’t be pretty!
The U.S. needs to begin producing the things we buy. Who can employ more workers? The factory that produces the T.V.’s, or the retailer who sells them? Our reliance on a service and retail economy will be our undoing.
“Who can employ more workers? The factory that produces the T.V.’s, or the retailer who sells them?”
Good question. You may wonder that in factories where production is almost completely automated the additional manpower, if needed at all, maybe less than in the store where some shopkeeper’s personal needs to talk potential clients into buying the gimmicks they don’t need nor want.