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Thursday, September 30, 2010


Nothing Has Changed

As I look at the last 2 years of the so-called US recovery, I see no recovery. The politicians continue to manipulate the static economic model, the federal reserve (a cartel) is more concerned with keeping their elite associates in business (banks, wall street, autos) with 0% loans, and supporting an absurd monetary policy by monitizing the US debt. I would have thought this turmoil would have initiated change in the way US citizens purchase the 2 biggest items in their lives, homes and automobiles.

The majority of US citizens have begun to figure out how this capital consuming policy works for those 2 large purchases. Why could'nt the US government have taken the existing commission structure for purchasing a home from 10% of the purchase price, divided between numerous middlemen, to 5%, instead of a short term home buyer tax credit policy? Why did the auto industry recieve taxpayer bailouts, and the cash for clunkers, a short term fix? Sorry car salesmen your capital consuming model needs to change also.

The unfortunate relationship between the US government, the large banks, wall street and the auto industry has to change, in order for the US economy to recover. Printing money, spending to create a larger government and thinking time will cure the pain is absurd. It is only prolonging the inevitable. If failure would have come to the corporations that caused this debacle, the system would have been cleansed, and new blood and new ideas would have emerged, like the ones discussed. While the corrupt individuals would have been fined, terminated and sent to jail. Also, the federal reserve should also be dissolved. Instead they are continuing to consume our capital.

Olsen was correct in his theory of how smaller groups with power are harder to dissolve, especially those connected to the large powerful and growing government. We can only hope for a crash sooner than later, this will detach the 50 year relationship with the government and the elites, and their capital consuming policy. Oddly enough as I write this contribution, the makets have closed on a rediculous high for the month of September, the biggest rally for the month of September in 70 years. This closes out the third quarter on a high, the monthly high, and the weekly high. If the equity markets do not make a new high next week, look out below. Buy some puts, or sell with both hands!

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