Posted on 26th November 2012 by Trevor in Uncategorized

“Indian Industrial Production Unexpectedly Fell in September”
– Bloomberg, November 12
“Economic output in the Eurozone fell 0.1 percent in the third quarter, following a
0.2 percent drop in the second quarter.”
– Reuters, November 15
“China’s vehicle sales fell for the sixth straight month in October.”
– Bloomberg, November 14
“Investment Falls Off a Cliff”
– Wall Street Journal, November 18
This story included that U.S. companies were cutting spending plans because of
“fiscal and economic uncertainty”.
Then there are two gems that really mark growing uncertainty:
“Krugman: Bring Back the 91% Tax Rate”
– The New York Times, November 18
“Treasury Secretary Geithner: Lift Debt Limit to Infinity”
– CNS News, November 19

Harvesting headlines is usually interesting and sometimes riveting. The first ones indicate a
slowing global economy – despite unprecedented stimulation, corporate bailouts and “fixing”
of any number of countries.

The problem in any post-bubble contraction is that in the mania debt was eagerly expanded to
an amount that can’t be serviced even by a strong economy. The debt burden seems to be the
main reason that post-bubble recessions are severe and recoveries are weak.

The last two headlines suggest that the establishment is discovering that massive intervention
is not prompting a strong business expansion. The proposed remedies of higher tax rates and
unconstrained issuance of treasury debt indicate that confiscation of wealth and earnings is
changing from a hidden to an open agenda.  Intellectually pathetic and fiscally tragic.




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