Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
US Presidential Election Year Stock Market Seasonal Trend - 29th Nov 24
Who controls the past controls the future: who controls the present controls the past - 29th Nov 24
Gold After Trump Wins - 29th Nov 24
The AI Stocks, Housing, Inflation and Bitcoin Crypto Mega-trends - 27th Nov 24
Gold Price Ahead of the Thanksgiving Weekend - 27th Nov 24
Bitcoin Gravy Train Trend Forecast to June 2025 - 24th Nov 24
Stocks, Bitcoin and Crypto Markets Breaking Bad on Donald Trump Pump - 21st Nov 24
Gold Price To Re-Test $2,700 - 21st Nov 24
Stock Market Sentiment Speaks: This Is My Strong Warning To You - 21st Nov 24
Financial Crisis 2025 - This is Going to Shock People! - 21st Nov 24
Dubai Deluge - AI Tech Stocks Earnings Correction Opportunities - 18th Nov 24
Why President Trump Has NO Real Power - Deep State Military Industrial Complex - 8th Nov 24
Social Grant Increases and Serge Belamant Amid South Africa's New Political Landscape - 8th Nov 24
Is Forex Worth It? - 8th Nov 24
Nvidia Numero Uno in Count Down to President Donald Pump Election Victory - 5th Nov 24
Trump or Harris - Who Wins US Presidential Election 2024 Forecast Prediction - 5th Nov 24
Stock Market Brief in Count Down to US Election Result 2024 - 3rd Nov 24
Gold Stocks’ Winter Rally 2024 - 3rd Nov 24
Why Countdown to U.S. Recession is Underway - 3rd Nov 24
Stock Market Trend Forecast to Jan 2025 - 2nd Nov 24
President Donald PUMP Forecast to Win US Presidential Election 2024 - 1st Nov 24
At These Levels, Buying Silver Is Like Getting It At $5 In 2003 - 28th Oct 24
Nvidia Numero Uno Selling Shovels in the AI Gold Rush - 28th Oct 24
The Future of Online Casinos - 28th Oct 24
Panic in the Air As Stock Market Correction Delivers Deep Opps in AI Tech Stocks - 27th Oct 24
Stocks, Bitcoin, Crypto's Counting Down to President Donald Pump! - 27th Oct 24
UK Budget 2024 - What to do Before 30th Oct - Pensions and ISA's - 27th Oct 24
7 Days of Crypto Opportunities Starts NOW - 27th Oct 24
The Power Law in Venture Capital: How Visionary Investors Like Yuri Milner Have Shaped the Future - 27th Oct 24
This Points To Significantly Higher Silver Prices - 27th Oct 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Market Bubbles and Economic Busts

Politics / US Economy Aug 22, 2013 - 10:53 AM GMT

By: LewRockwell

Politics

Charles Goyette writes: Has President Obama at last figured it out?

If only.

The President has been talking a lot of late about the bubble economy. Last month he mentioned “unstable bubbles” that threaten the economy, and the other day in his radio address he referred to “the bubble-and-bust mentality” that has made “a mess” of our economy.


We would feel better about Obama’s comments if there were any reason to think he has a clue about the role of the Federal Reserve in creating these bubbles and busts.

But experience teaches that the repeated use such terms and buzz phrases by party apparatchiks and presidents – Obama has talked bubbles four times in five days – means that they are nothing but focus-group tested talking points. Some research firm has been paid by the party to hook subjects up to machines and find out what words resonate with them by making their palms sweat and pupils dilate. That’s the high art of today’s politics.

Do you suppose Thomas Jefferson used a focus group to test “We hold these truths to be self-evident…”?

It’s not entirely clear what the president means anyway. Buzz phrases and sweaty palms are poor substitutes for clear thought. The bubbles are visible enough, but recently Obama said, “When wealth concentrates at the very top, it can inflate unstable bubbles that threaten the economy.”

Then why has his administration driven the concentration of wealth, the bailouts of the influential, the sweetheart deals for the crony classes, and the monetary policies that have stove-piped money to Wall Street, enriching the banks while the people continue to suffer depression-era levels of unemployment and watch full-time jobs turn to part-time?

I think that Obama, as well as most Republicans, is a corporate statist, rather than a Marxist. That is the broad road to electoral success in America. But even so, the ghost of Karl Marx lurks somewhere in the president’s outlook. Marx held the view that a destructive cycle of booms and busts was inseparable from capitalism itself.

But the Austrian school economists – Mises, Hayek, Rothbard – have long since demonstrated that rather than capitalism, the boom and bust syndrome is the work of central bankers and their distortion of money and credit conditions.

Obama knows none of this.

Focus-group tested talking points aren’t the only thing self-evident in the modern political process. So, too, is the lap-dog press, always subservient to its statist masters.

The newspaper account in which I read of the president’s radio remarks about “bubbles and busts” filled out the story with reference to the likely replacements for bubbling Ben Bernanke at the Fed: Janet Yellen and Larry Summers.

For a comment on these two peas in the short-list pod it turned to – of all people – a former Fed official!

And he offered that “both candidates can claim bubble-battling expertise.”

How is it that we’ve had more bubbles than Lawrence Welk and his Champagne Music Makers, what with the president and all these bubble-battlers bustling about?

Just this week the Federal Reserve’s purchases of U.S. government debt with money it just created out of thin air has topped an unthinkable $2 trillion! Add to that the $1.3 trillion in mortgage-backed securities it has purchased, taking toxic paper off the balance sheet of the banks and transferring it onto the account of the people’s dollar.

And thus wealth concentrates at the top.

The downward movement of bonds will only be exceeded by the upward movement of gold as this biggest-of-all-bubbles plays out.

Charles Goyette [send him mail] is the author of the New York Times bestseller The Dollar Meltdown. His new book is Red and Blue and Broke All Over: Restoring America's Free Economy. He is also editor of Freedom & Prosperity Letter, a monthly political and financial newsletter dedicated to revealing the truth about the U.S.’s political scene and economic climate. To learn more, go here.

Copyright © 2013 Charles Goyette

http://www.lewrockwell.com

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in