Johnny Football

O.k., this is not an economics story. Sorry, but it needs some insight. This kid doesn’t have to do a lot to generate bad publicity. He may end up being a complete bad actor but so far what he has done off the field seems slight when compared to murder, serious gambling, child abuse and hard drug addiction which are fairly common transgressions of many NFL players.

As far as the Cleveland Browns are concerned, what quarterback in his right mind would take that team seriously.? The Cleveland Browns are a complete train wreck.  Playing quarterback on a team that bad is a lose lose situation and actually dangerous. Assuming Manziel gets released, that may turn out the be the luckiest thing that has happen to that boy.

Even if Manziel never plays another down in the NFL, he is better off being out of Cleveland. At least in that there is hope. Being a car salesman is a step up from playing for the Cleveland Browns. But, “no thanks”  is not a phrase that is used in pro football.


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Stock Market Liquidity

012716Apple is one of history’s largest corporation. Unlike other high flying stocks, Apple earns a  discernible profit and has always traded at a reasonable price earnings multiple. Today Apple lost 6.5% of its value in one day. That should sound like a lot, but these kinds of price movements are standard in today’s financial markets. In an efficient market. this kind of thing normally occurs perhaps once over a years time and not in one of the Dow Jones Industrial components. The fact is that stock markets around the world are train wrecks waiting to occur.

What does liquidity mean? You might think that it means only a lot of money available to trade with. For a specific market, liquidity means that an asset can be bought or sold instantly without having much impact on the price. In liquid markets investors have a way of anticipating earnings in advance so there is not a huge impact when news is announced.

This post is not about the prospects for Apple stock over the coming days. The fact is that stocks don’t act like this in legitimate markets and this is a huge warming sign for the market overall. It is a sign of instability and extreme danger.

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Work is a Second Choice

Big_Male_Lion_Eating_An_Animal_Carcass_600One big myth is that lions always kill their own meat. More often than not, they find a dead carcass and eat that as a first choice. Usually they run off some weaker predictors and steal their prey and that is a fraction of the effort it takes to track and kill. In nature, work is a second choice. Work is a second choice in mankind also.

Are you aware that historically, economists have been overwhelmingly wrong at every significant economic turning point in history? This is largely because they use erroneous assumptions in all of the work they do. In economics, human beings are assumed to be champing at the the bit to do do productive work.  In practice, work is in fact a second choice. Work is only done if the same return cannot be gained without working. Living off the efforts of others is always the first choice with work a respectable second choice.  It is a human characteristic to present oneself as completely noble in every thought and action. In real life it doesn’t work that way.

Entire institutions and behaviors have become organized around the effort to get payed without working. All of modern democracy today is centered around millions of people trying to get what they want by getting others to provide it for them. For generations, the rich have used government as a way to exempt themselves from any constraints of a free market while making sure that free market principles apply to all others.

It is impossible for economists to predict human behavior when their assumptions with respect to the most basic incentives are completely backwards.

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Bank Robbers Profits

bank-robbery-scary-maskThe practice of robbing banks at gunpoint turns out to be not that lucrative. The very best of that kind of bank robber averages only four heists before getting caught. On average, each participant in that kind of robbery nets only about $4,000 per hold up. That is only $16,000 before going to prison. That is too paltry of an income given the enormous risk and the certainty of getting caught. Picking up aluminum cans or begging with a sign on a street corner has a higher return.

Now when banks rob people, their profits are astronomical. Since its inception, the Federal Reserve has assisted banks as they go about robbing the general population. This has been the goal of the quantitative easing  initiatives going back to TARP and all of the programs that have followed. The most profitable method of committing a crime is to partner up with government. After that crimes become legal and meaningful laws are not enforced. There is a downside for banks in using the cover of government to rob people. It is like killing the goose that laid the golden eggs. Banks have robbed the general population to the extent that there is no way now to keep the economy from sliding backwards and in this banks end up suffering right along with everyone else. Of course financial institutions have made so much in the run up, it has to have been worth it to them regardless of the negative end result.

There are two different kinds of bank robbers. There are the kind like John Dillinger was and then there are banks that do the robbing. The best kind of bank robber to be is the bank that robs ordinary people.

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What a Real Bear Market Looks Like

1929I will be clear. The economy in the United States is much worse now than it was in 1929 or in 1973. This will be the first economic collapse to occur following forty years of government intervention in the economy. Government has been supporting asset prices since 1987, off and on at first and finally on a daily basis.  Given the gravity of the current circumstances, the coming trouble will likely exceed what was experienced following 1929 and of course 1973.  1973To gain perspective I am posting charts of stocks 1929-1933 and 1977-1975.  Both of these bear markets occurred because given the respective resource distributions the economy could no longer grow. That is the situation today. When looking at an economy, remember that the present cannot be explained with numbers. It is all folks acting on incentives. Understand incentives and what t0 expect next becomes very clear.  The next bear market will likely take several years to completely hit bottom. After that there will likely be stops and stats for about ten years. This is what happens when an economy resets. The U.S. economy is way over financed. This means there is more money chasing investments than there are legitimate opportunities. On the bright side, if the country survives, this will be the stock buying opportunity of the century.


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Lies vs Ridicule

If it Turns out that Hillary Clinton and Donald Trump face off in the 2016 presidential election, it will be a truly unique election. The worlds most accomplished liar, Hillary Clinton,  will face the world’s most adept master of ridicule, Donald Trump.

At first glance it appears that the two are evenly matched given their superb skills. A more in depth look reveals that Trump has a clear advantage. Although ridicule is despised and frowned on in American society it is an extremely effective tool when used against a liar. As a matter of fact, ridicule is the only tool that is effective a complete liar.

Make no mistake, Trump is not Jesus and tells plenty of lies himself. But, ridicule is the tool Jesus used to attack the Saducees and Pharisees who were the greatest liars of their era.  The old books contain countless models of natural law independent of  the spiritual message.

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2016 and the Stock Market of Course

Stunning-Happy-New-Year-2016-Images-Happy-2016-Pictures-7Lies live a long time but they eventually die. The punishment for believing lies is staggering and lethal for many. Debate could go on a long time as to which is the biggest lie of the century.

The notion that in representative government representatives serve constituents can be believed as a lie but that belief can be due to a general lack of awareness. Believing that the Federal Reserve has been tirelessly trying to do good things for the economy is another story.  Anyone with half an educations understands the difference between an independent variable and a dependent variable.  The distance a car can drive is dependent upon how much gas is in the tank. Only a fool would claim that putting a bigger gas tank on a car and filling it with the same amount of gas will cause the car to go farther.

People have believed that if the Federal Reserve pushed up stock prices, the general economy would expand. In the end stock prices are determined by nothing other than the profitability of the underlying corporations. Believing this lie will result in suffering that few can currently fathom.

There has never been a chance that goosing asset prices would do anything other than pay the people who own the assets. Federal Open Market Committee members know this. No one with as much intelligence as these people have could possibly believe such a silly notion. I will say it again. When a lie is told there are two guilty parties. There is the liar and then there are the folks for whom the truth is not good enough.

The stock market was totally managed during 2015, 2014 and 2012. I was wrong in forecasting that the averages would close positive for the year. The effort was made but it failed. I am absolutely sure 2016 is beginning with plans to launch a new leg to the bull market. Now I honestly don’t know that the consortium is strong enough to pull it off.

A sell off on the first trading day of the new year is to be expected. This is to draw in as many shorts as is possible. I am not sure the following squeeze will go as planned. Panic may set in. The public is growing more and more distrustful. Many companies are beginning to experience losses on their buyback programs. Reality may be setting in. The Federal Reserve wealth effect lie is on life support now and somebody may pull the plug.

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Bird Brains

bird_brainsFolks are often amused that certain birds fixate on the first moving object they see and then follow it around forever. Human beings do something very similar. Give a bird brained human being a definition of a person or an institution and that sticks for as long as they live regardless of how a person or institution functions.

Everyone needs a high school education, right? Who is getting an education in high school? Is a  diploma evidence of learning? For 85% of students, learning from the 9th through the 12th grade is incidental if they learn anything at all. High school could correctly be defined as a holding bay to keep teenagers off the street until they are old enough to legally take a job.  Google is defined as a search engine. Google does not provide a real search function any longer. It is a parasite that actually prevents people from finding what they want on the internet.

Here is an article describing how Google which is falsely defined as a search engine collects information on children attending schools that are falsely defined as educational institutions.

From Michael Krieger of Liberty Blitzkrieg

Google is Collecting Information on Public School Students – Here’s How

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Final Thoughts for 2015

american-flag-beautiful-images-hd-new-wallpapers-of-us-flagI will explain the source of our country’s difficulties in just a few words. There is a change that must be made if we are to survive as a free society. Today billionaires can and do hire the federal government to work for them. The Republican and Democratic Parties function as brokers which sell government’ power and influence to the highest bidders.

This practice cannot be allowed to continue.

James B. Miller explains the situation very well in his blog article. We’re All Fascists Now

I have explained many times that in democracy crime and government merge as a path of least resistance.  Government provides legal ways to steal money. That is what fascism is and we are in the middle of it.

Student Loan Moan

Curbside Jimmy’s Free mp3 Download Page,

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Stock Market Now Through January

Wall-StreetHuman behavior is highly predictable. Dogs and cats have it down pat. Animals do not define their owners with euphemisms. They respond to them exactly as they are and know exactly what to expect. Human beings define their masters with all sorts of lofty euphemisms so they are completely confounded by what happens. You have no masters? That is because you define them as representatives, regardless of the fact that you serve them.

There are plans for the stock market. There is virtually no chance the averages will close down for the year, even if indicators lead you to expect that it will. Following an up year, you can expect a sell off in the first few days of January 2016 and then a break out to the upside which will be billed as the next up leg of this amazing bull market. Never mind that the breadth may be miserable and international events and circumstances will be miserable.

To accomplish these things, all it takes is all of the money in the world. The central banks have that and even more if they need it. All investors have is what they have earned.

How is such a thing possible? It is easy. All it takes is for the overwhelming majority of world citizens to believe the Federal Reserve is necessary, Open Market Committee members are honest people and that all that is being done is for the public good.

The truth is that Wall Street has hired government to enrich them and that is what is happening. It is as simple as that. The end, of course, is the complete destruction of the economy. That takes a long time so it is still open season on anyone who works for a living.

Americans will figure this out and rebel horribly but the odds of that happening in the next 30 days is real slim. I am forecasting dismal results for anyone trying to short this market. You are right about what you see but having all of the money in the world is an advantage that is hard to overcome. Donald Trump knows these things, so why is he not speaking up? Trump may be a refreshing figure but his bid for the presidency is self serving as all such efforts are. He will speak up only if it is to his benefit to do so.

Here is Curbside Jimmy’s Like The Highway and the Sea


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