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This graph says it all — US 2016 Recession Already Here!

US recession 2016

This graph by 720Global shows how spot on my pronouncement of a US 2016 recession is and how precarious the path ahead. In spite of the lack of any official declaration by the US government or its economic priesthood, I’ve stated more than once in 2016 that the US is already in recession. Several interesting observations can be made from this graph:

 

  • The red line marks current US GDP (1.2%) as estimated by the US Bureau of Economic Analysis (BEA). At virtually every point in the last seventy years when US GDP hit 1.2%, the US has been solidly in recession (blue areas). In other words, the US was not ABOUT to go in recession at that level of growth, but was IN recession each time … with only three exceptions. Two of those are “exceptions that prove the rule” (i.e., the very reason these exceptions happened prove how significant the underlying rule or belief is):
  • Twice during the years since the Great Recession, GDP touched this low, and we did not go officially into recession, but look at why: In both of those instances the US only averted recession because the Federal Reserve immediately kicked in massive doses of quantitative easing. (The Federal Reserve is not going to do any immediate quantitative wheezing to keep us above the line this time because all of its talk has been about raising interest rates. More wheezing would prove the Fed is unable to raise interest rates (as I said last fall would be the case after made its first raise in December. So, the Fed will only apply QE at this point when it sees for certain that its patient is dying, which will be too late.)
  • The graph reminds us of something we’re all aware of: Based on the average frequency between recessions, the US is due for a recession in 2016 anyway.
  • An even more interesting observation to note is the general long-term decline of US economic growth. Seventy years ago, the US emerged from recession with 12% growth in GDP. For the next thirty years, it would emerge with about 8% growth. For the next twenty years after that, the best the US could hope to see was around 4% growth in GDP; and for the past decade, the highest peaks the US can manage in economic growth have been about 3% growth in GDP.

 

In part, the declining growth rate in GDP could be because it is harder to get as large of a percentage increase as GDP gets larger. (In the sense that it is easier to double your speed at ten miles per hour than it is at fifty miles per hour.)

However, I think it also reflects how, as US national debt has piled up, its ability to achieve growth has significantly diminished because of all the ballast it is carrying. The fact that it has taken enormously greater stimulus to achieve these steeply diminishing returns indicates the severe drag created by this ballast.

One could also blame increasing regulations; but there is one very interesting thing you cannot blame … and that is taxes. We consistently achieved much higher rates of growth back in times when income tax (and especially capital gains tax) was much, much higher (both corporate and individual). So, the growth decline certainly can’t be blamed on higher taxes because they aren’t higher.

It will annoy many I’m sure to see that significantly lowering taxes hasn’t done anything to boost the US rate of growth. We can dispel the notion for good that we are going to save our economy with anything as simple as tax breaks. Clearly we have a much more significant underlying problem that tax breaks have been unable to overcome, as they have given only temporary boosts and have given much less bang for the buck each time.

One cannot blame free trade for this trend because the worst declines in the growth rate happened long before free trade; but one can also say that free trade certainly hasn’t boosted the US rate of growth, just as lowering taxes hasn’t.

I think the one thing that is most consistent is the ever expanding chasm of debt that undermines our economy as we attempted to grow without paying for our growth as we went. (Expanding the debt to create stimulus in bad times, but never paying it off in good times. Acting as if debt is forever free.)

Whatever the cause, the US growth rate clearly has become consistently getting weaker for a long time and has now reached a point where economic growth is so elusive that only with extraordinary stimulus do we keep our heads barely above the waterline that is associated with all recessions. While the US did not officially go into recession every time it dipped to its present level of GDP (given the three exceptions, two of which only averted recessions by extreme measures), every recession the US has had in the last seventy years started at or before the point where it dropped to its present level of GDP. Every single one!

 

The Great Recession rages on as the 2016 US recession unfolds

 

Recessions, of course, only get officially declared after the fact, never when they first start. By definition, an officially declared recession requires two consecutive quarters of declining GDP. That means recessions can only be officially declared after both quarters have passed and then only after numbers for the second quarter are in. Usually, they don’t get declared until the numbers get revised, as all government reporting seems to run optimistic until revised (usually under a subsequent administration).

So, at the earliest, recessions are declared about seven months after they have begun. Often, they are not declared until a year or more after they began. We are practically out of them before we officially know we were in one. (And, if you’re Ben Bernanke, you can be standing knee-deep in the middle of one and declare there is none in sight … as far as the eye can see.)

I’ve maintained for years that we are still in the Great Recession. The graph shows how the first round of quantitative easing took us out of the belly of the Great Recession and back above the recessionary red line, but also how the US economy immediately dove back to the recessionary redline as that round of QE ended, requiring another shot of QE to keep the economy from going under. The economy relentlessly plunged toward the bottom every time economic stimulus ended. So, without stimulus, the US economy is a zombie that now exists in a perpetual state of recession! It is the walking dead.

Notice how the growth line staggers upward during the last period of QE. That’s because that round was a dosed out in continuing measures of new money (a new shot every month for a couple of years), rather than a single big hit.

Notice how the US maintained a completely steady move down toward the red line again after the last round of continuous quantitative easing (QE3) was terminated in the fall of 2014. I want you to see that because in early 2014 — well before QE ended — I said exactly that would happen as soon as it did end in the fall of 2014. GDP growth moved steeply downhill ever since this steroid was removed from the economy with NO quarter that was an exception.

As I’ve said throughout my years of writing The Great Recession Blog, the economy has only been kept marginally alive by repeated rounds of stimulus upon which it is utterly dependent. This graph shows that better than anything I’ve seen.

It has taken repeated doses of the largest money printing in the history of the world AND the lowest interest rates ever known, applied by central banks throughout the world, just to keep the patient artificially alive since the Great Recession sucker-punched the world.

In early 2014, I predicted that, once this massive life support ended, we’d find out how dead the patient really is as we sink back into the belly of the Great Recession. This graph shows that we have sunk just as fast every time QE ended and that we are now back at the level of growth that is always associated with recessions; and this time there is no QE to be offered.

That is not to say that, once we go back below the red line, as we are doing, the Fed will not eat its claims of recovery by creating the most massive combination of stimulus ever seen just to keep the patient ever so slightly above the red line of death for a few moments more; but it is to say that the next round of QE will come too late and that no amount will be enough to do the job.

I have said consistently on this blog that 1) there will likely be ONE more desperate round of massive stimulus by the Federal Reserve; 2) it will be applied too late because the Fed needs to prove its recovery has worked so it will be extremely reluctant to apply QE this time; and 3) any amount or kind of stimulus applied will be almost completely ineffective, stirring only a meager bleep of a heartbeat.

 

Modern economists are the dumbest dinosaurs that ever roamed the earth

 

Modern economists cannot see a recession coming even when it is about to poke their eyes out.

You cannot beat the Law of Diminishing Returns, but modern economists at the Federal Reserve and in government and on television stopped believing in economic laws long ago. They live in a make-believe, and that is why they create upside-down Wonderland economies.

Thus, a person with no economic background (me) has to school these enfeebled minds in their own field. There has, I believe, in the history of the world never been such a large group of intelligent people who look so consistently dumb in the area of their own expertise and who get so consistently rewarded for looking dumb … as modern economists.

This graph is a photograph of the utter bankruptcy of modern economic belief in a debt-based economy. It is a testimony to economists’ failed religious faith in central-bank stimulus and their refusal to believe in the ancient, proven Law of Diminishing Return.

The rate at which the benefits of stimulus have diminished over the past decades even while the size of stimulus has exponentially increased shows clearly that the next round (helicopter money that is being talked about all the time now along with negative interest rates) will be the most massive application of life support the world has ever seen and, yet, will result in the patient barely recovering to a comatose state at the edge of the red line. The next does of stimulus may stir a brief heart flutter, but will actually kill the patient. It will drive the zombie economy to a level of death where even artificial life support can no longer make it appear to be alive.

 

2016, Year of the Epocalypse

 

And that is why I call this the Year of the Epocalypse — the year in which we sink unrecoverably back into the swelling belly of the Great Recession. This is the year in which the greatest rounds of stimulus that will ever be applied only manage to put our heads above the waves long enough to see the next election through. And that’s a best-case scenario in light of it being an election year.

By Federalreserve (00491) [Public domain], via Wikimedia Commons

The Eccles Building, Temple of the Federal Reserve

Everyone in government (Democrat and Republican … plus our token Socialist) will do anything they can to patch the economy along in order to make sure Donald Trump doesn’t get elected. If Trump does get elected so the wizards of false finance give up the battle the day after the election, all hell will break lose on the economy. That will be OK with the high priesthood because they will try to use Trump as a scapegoat, seizing the opportunity to claim their recovery only failed because of the panic that Trump’s election caused … if they let him make it that far alive. Worst case scenario, the government and the priesthood in the Eccles Building lose all control before the election happens because even their darkest sorcery might not have enough magic to keep the zombie economy walking.

You couldn’t ask for a more consistent pattern of falling returns from exponentially greater efforts than this graph shows. It marks a relentless track into the belly of the Epocalypse — round two of the Great Recession … and by far the deeper round. The Great Recession has a gravity that keeps sucking us in.

Zombie economists create US 20116 recession

Economists on the march in Washington

The Fed’s “Recovery” is entirely artificial and unsustainable. It’s second and third comings have all died. Any economist who ever held such a flamboyant disregard for true economics (i.e, who believes in a debt-based economy) has an eggplant for a head. This graph is testimony to the bankruptcy of their belief system. They are the priesthood of a zombie economy.

 

 

 

 

 

Not Fed-up yet, here’s more Fed fun:

And for further reading on the follies of finance:

  • jakartaman

    This is all background noise
    We all will know when the cards start dropping.
    I am still in the camp that it will be all over less than a months time when it begins to the end. Not a slow squeeze around the neck but a 2×4 along side the head.
    People will be walking around in a dazed shock.

  • steve jones

    Also don’t forget that were are now in an energy deflationary environment, as we descend from the (low cost) production peak and enter a permanently a high EROI world . Virtually all debt is energy debt, and this is the case no matter what price crude is at.

  • Bill

    Are derivatives in hiding?

  • Kim

    I really appreciate this blog and this blog post. I’m trying to understand these things, I have no education in finance but I do understand basic laws (natural laws) of economics. I’m sort of new to all this –a few years new that is– to reading/understanding the situation from blogs such as yours, also ZH and Wolfstreet, et cet. I have pretty good reading comprehension, but sometimes I have to read these blogs posts two or three times before it sinks in. Numbers. Ugh.

    I have a question or two, if I may and please excuse my ignorance if it’s apparent in your article and I missed it: of the three exceptions to entering a recession when the annualized GDP growth is at 1.2%, two being in 2011 and 2012 when the FED implemented massive QE, what was the third exception?

    Also, about the govt/media-economists that you call modern economists- it’s not that they can’t see recession coming. They can if they wish to. But, in line with the FED’s publicly stated goal of raising the funds rate, forecasting recession is not part of the narrative, or the scheme, the pretty picture–it’s not at all in their collective short-term interest to see a recession coming or even here now, or even care, because the FED has their back. Their professional opinions are bought and paid for. In fact, their opinions, as publicly expressed, are a matter of administrative order. Imagine, hiding the truth as a federal directive.

    Lastly, as a woman, i feel it’s sometimes hard to express myself on these blogs and be taken serious. I find the vast majority of beautiful minds on blogs like this are male (but, figuring at least some females are hiding behind male screen names). I’m not complaining about this. Just an observation; my own insecure observation. Maybe I feel this way because of the vulgar and obviously male-dominated, yet extremely funny and always entertaining, comments section on ZH.

    Thank you,

    • Hi Kim,

      Good to see you back in the comments section again.

      You are right that I didn’t cover the third exception, and maybe I raised a question that I needed to find an answer to. The fact is that I don’t know why the third exception happened. It was a long time ago (before my lifetime). If you look at the graph, back at about 1955, GDP growth briefly touched below the red line when there was no recession. You have to go back sixty years to find a time when GDP growth was this low and there was no recession, and then it was a very brief dip below the line — looks like a single quarter.

      As the other two happened recently, I know what they were about and that the dip to our present level of GDP growth was immediately averted with massive stimulus, the likes of which we had never had to use until this decade.

      “Modern economists” is a term I resort to because they don’t ascribe to longstanding economic thinking. They are not really any more modern than anyone else on the planet, but they have thrown out tried-and-true economic laws for theories that are not proving out to work too well (as you’ve seen). I find it hard to know if they are really as dumb as they seem. I think they are dumb partially for the reasons you indicate, which go along the lines of they don’t see what they don’t want to see. I think they are sometimes lying, as you also indicate, by refusing to see a recession that is already here or is near because that would say the Fed has failed or because saying one is near could be self-fulfilling.

      I also think they wouldn’t do such dumb things as Ben Bernanke did when he said in 2008 there was no recession in sight only a couple of weeks before a recession was declared that started six months before his statement, which should have made him look really, really dumb to congress and anyone else who was paying attention. (Have to assume no one in congress was paying attention, or they would have resisted letting him become chair of the Fed a short time later.)

      I think ordinarily smart people are easily blinded by their ideology. It’s a pretty common human trait in all areas of human endeavor. Many people don’t see what doesn’t fit their belief system. It may be denial or just blindness to things that don’t pass through the mental filters.

      You’re right, though, that for many, their publicly expressed opinions are a matter of administrative order. That’s a good way to put it.

      Even beautiful women are taken completely seriously on this blog, where the assumption is that they are probably as bright as they are beautiful. I find ZH is a rough and rowdy bar even as a male stepping through the door. More so than most places. Kind of a strip joint, actually. They can be pretty harsh against my own opinions, sometimes failing to recognize that they actually agree with me simply because they are so used to shouting down what they don’t believe in.

      Nevertheless, like you, I go their daily. I, at least, don’t have to worry that all the food will taste like it is salted with the same MSG of political correctness that keeps everything at the salad bar GREEN.

      –David

    • Auldenemy

      Good for you Kim! Yes, some comments on ZH are hilarious but some are truly disgusting (and believe me, I am not some dried up old prune). So far, Sir Dave seems to attract far more elegant responses to his superb articles (perhaps that alone is proof of what a great writer he is). It is great to see a woman speaking out on the dire financial/economic situation we are in thanks to being ruled by a banking-big corp.-political elite which lives in complete denial so as to grow its wealth and power at the expense of more and more ordinary citizens. As to any male cretins out there who have attempted to drown you out because of your gender, the best way to deal with those types is to patronise them by telling them that to try and demean your comments on the basis of your sex means only one thing, that they have a hamster sized dicX and that while you are sorry for them rather than taking it out on women maybe they should see either a shrink or a plastic surgeon.

      Multum In Parvo

    • QEternity

      Search Dimartino Booth and read her blog. Smart woman.

      Edit: http://dimartinobooth.com

  • Auldenemy

    There is a very apt joke about economists. So as to keep it as clean as possible for your superb site, it goes along the lines of an economist being first on the scene to a man lying still on the ground. He kneels down and the second person on the scene says, ‘Can you feel a pulse?’, to which the economist replies, ‘No but his penis feels hard so he must be alive’. That sums up the Fed anyway when it comes to the dying USA, and of course entire Western economy. They employ economic stats that proclaim a corpse is alive and thriving because its genitalia is stiff! The Fed genitalia is the S&P500, which by QE, Operation Twist, no real interest rate rises, endless free money for Buybacks and constant PPT interventions, is in effect an erection caused by masses doses of Fed Viagra. The rest of the body, the economy, is dead.

    The BBC, Independent, Newsnight, Guardian and Channel 4 are not exactly natural allies of The Times and Economist. The completely corrupt USA banks, Goldman Sachs and JP Morgan throwing money at Team Cameron’s pro EU campaign, went completely un reported by the MSM. With the Left Wing media seeing the EU and its free movement laws as a socialist wet dream, and the Right Wing seeing it for what it is, a means for big banking to continue asset striping entire European nations, it is a miracle that over 50% of those who voted in the UK referendum, saw through both the Right and Left Wing propaganda and with great common sense put two fingers up to being ruled by an unelected and thus unaccountable Commission in Brussels.

    A banking-political elite have gradually managed to by-pass the democratic process to rule the entire West. We have status quo politics who ever gets into power because politicians now serve banking interests before serving the citizens of their own countries. Hillary Clinton is a supreme example of this, having been bought out completely by the millions paid to her by Goldman Sachs. They own her and if she become the next USA President the banking-political status quo dictatorship will continue until the West becomes completely broken by their insane monetary policies, designed entirely to keep themselves in wealth an power at the expense of the majority of citizens. Poverty and social discord will grow, with uncontrolled immigration and on going terrorist acts simply adding fuel to the fire.

    So Theresa May would be wise not to turn Brexit into Fudgeit. If she does then UKIP will fill many seats in the House of Commons come the next election.

    The BBC and most of the MSM are now trying to blame the sliding UK economy on Brexit. They are wilfully editing out the fact that every major economy is sliding, from America to China, with the EU now in another banking crisis due to insolvent Italian banks in a country awash with corruption. Brexit has nothing to do with these massive problems, in fact Brexit happened due to enough people in the UK having the common sense to face up to these problems and demand they be addressed. The banking-political elite who rule from Washington through to the UK and on right through the EU can hide their heads in the sand all they wish, but as the financial and political mess they have created – born by citizens ever since the massive banking bailouts of 2008 – increase, this parasitical elite will be forced to wake up and smell the coffee. Most of them deserve prison sentences for their dereliction of duty and obscene levels of corruption.

    • Don’t worry. You may be in mixed company, but apparently Kim can handle the joke as she survives Zero Hedge, and that’s a pretty wild place.

      You’re right that it is ludicrous that Brexit is blamed for current stock price collapses in Europe and particularly for bank failures. Those banks have been well known by everyone to be on a downhill slide for a few years. Only when things become highly unstable will a job from something like Brexit topple them, but it is never the jog that was to blame but the instability of the structure that made it ready to fall.

      Italian banks are suffering structural failure. An old man could poke them over with his cane. So, the fact that their stresses became all the more apparent when Brexit hit, doesn’t make Brexit the cause of their fall, just the tap of the cane on the crumbling brick facade. The Eurocentrists miss the point entirely that Brexit happened because they failed. The EU is not failing because of Brexit. Brexit is people rushing for the exits because they can see that the brick are slipping out of place, and they don’t want to be standing inside the bank when it all falls down. Brexit is people getting out of the way. (So, they run, and the bank falls, and the stupid banksters who are looking for a scapegoat will say, “It was the thunder of their feet that knocked our magnificent bank down.”)

      In the same way, I expect the establishment in the US to make Trump and his runaway electorate their scapegoat for the failure of their bankrupt ideas if Trump wins office. They will probably intentionally let things fall apart if he gets elected, just to seize the opportunity to buy cover for themselves and say, “Look at what HE did.”

      That’s why Trump has said hopes that, if it is going to fail, it fails now. That way they can’t blame him. They’ll still try, and say things fell apart because Wall Street became so afraid of the fact that Trump appears to be winning the election that fear of his bad ideas jinxed the market. Again, if the structure of things is so week that the MERE THOUGHT of something else could make the structure tremble and fall, then the faults were all in the structure, not in the trigger.

      It is interesting to note that the powers that be in Brussels look an awful lot like a cabal of bankers. One has to wonder why Brussels appears to be a bank, rather than a political union. I can’t tell where the banks end and the union begins.

      –David

      • Auldenemy

        All great writing reads like it is effortless. Yours is in that category. Of course it isn’t effortless and yet you respond generously to all who come to your site. I think your reply is absolutely spot on. I love your description of Italian banks (as in being like an, ‘old man with a cane’). You have a very visual mind (I see it also in some of the pics you use with your articles, again this separates you from other well known financial/economic analysts who tend to use only graphs and charts always, which can be stupendously boring at times). The ending of your reply is masterly, as in not being able to see any dividing line between the EU and banking. You just nailed it!!!!! The EU is a mega bank that is making laws. You have true genius.

        Thanks for not being offended by the economist joke (the sexual element). I so agree about ZH. As you said to Kim, it is a rowdy bar but I also check it out every day because quite often there are some worthy nuggets amid the dross (both the articles and some of the comments to them). That said, I must be getting old because I find some of the language literally appalling. I would be a total hypocrite to say I never swear, but I wouldn’t use the, ‘F’ word on a public site. Also, even in my private life, the, ‘C’ word is one which for me is out of bounds (it is only used in the UK by the lowest of the lowest).

        I was thinking a lot recently about, ‘morality’ and how in my own mind it brings visions of some two faced old preacher (the type who keeps banging on about hell for sinners before picking up a hooker). I realised even the word, ‘morality’ has been completely demonised (just like gold and silver). In fact, if there is no morality in our lives there is no sense of consequences for our own, individual actions. Perhaps that is why we have this ‘victim’ mentality now (people screw up their own lives but want to blame it on others or the system). Where once the West was perhaps over burdened with morals (and of course often imposed upon the masses by people with little to no morals of their own), I feel we have gone way to far the other way. Flicking through the TV channels during one of my usual nights of insomnia I happened on the most bizarre UK light entertainment programme. A man or woman has to pick a date from 6 other people. So what is so odd about that? Well all the contestants, apart from the one doing the choosing, are naked. They stand in individual see through booths, and bit by bit more of their naked bodies are shown, with the contestant doing the choosing, slowly eliminating one after another (based on which body parts they don’t like). The faces of the last three naked contestants are shown last. That means the other three have been deselected on the grounds of what their butt, their legs, their upper torso and of course their genitalia look like, their faces haven’t been seen at all by the person who has deselected them. Finally the person choosing a date from the assembled naked contestants, also has to remove their clothing and then make a final choice from the two remaining candidates. Even the look of candidates genitalia comes under great scrutiny.

        This truly ghastly, ‘light’ entertainment programme made me think of the days when there used to be such a thing as romance, of sensuality, of the long chase. I thought how pleasurable that was compared to this new age of fast, instant sexual gratification. So yes, I am old and I don’t understand the world at all anymore (if indeed I ever did). All I do know is that there appear to be close parallels with the fall of Rome. The Romans ended up completely debasing their silver currency as their war debts built exponentially. This infuriated the average citizen as of course it began to destroy their livelihoods. Meanwhile the elites became more and more detached. They thought the system they inherited would always continue and stuff the ordinary citizen, there would always be low cost slave labour. In other words, the Romans managed to gut their own version of the middle classes, and any economy that ends up with a small, rich elite and a mass of uneducated, cheap labour becomes nothing more than a present day African dictatorship. It is also interesting that as the power of Rome ebbed the partying and moral degeneracy grew. It feels like Rome is being repeated on a much larger scale. We have elites and their cronies sucking up as much power and wealth as possible, importing endless migrants to work for peanuts while the indigenous white, middle class slowly join the growing under class. Too many totally different cultures are shoved together in poor inner city areas, causing social dis cohesion in the form of fear, resentment and sudden violent outbursts. The elites who wilfully continue to import cheap labour imagine their power to be invincible. It isn’t and history proves it again and again. Their agenda has been to under educate the masses for decades, to replace the jewel of learning with gadgets that dumb down what might have been, with the right encouragement, questioning minds. The ersatz jelly is topped off with ersatz cream in the form of complete sexual liberation. Everything is about diversion; the masses are given a continual false narrative so that the paper Ponzi scheme can continue and the massive power that hinges upon it. What these idiots fail to see is that corruption upon corruption leads to an ever worse conclusion. A small fire can be put out, a larger one contained, but adding petrol to a forrest fire can destroy an entire State. That is what these CB cretins are doing, along with their big corp buyback cronies and the muppets (politicians) they buy out to shove in front of us and spew lie after lie after lie. It is worse than even a raging Forrest fire because it is encompassing the entire West and even the East now and unless it is handled with great courage and skill, this complete financial mess could end up costing millions of lives (either through dire poverty or outright war). The problem is we don’t appear to have any leaders with either courage or skill (let alone both!).

        Has there ever been morality in banking? I doubt it. All I do know is it’s already past the time when banking and big corp. should have NO influence in politics. It is surely no coincidence that in the age of complete financial and sexual immorality our once strong Western nations are turning into gutted communities. With so many of our industries gone, what is there for the uneducated, unemployed youngster. The girls get pregnant in their teens while their boyfriends take drugs and end up in the gutter or dead.

        I am not suggesting the answer is a Bible Belt mentality. To me religious extremes always cause more problems than they solve. I am not suggesting all immigrants are sent back to where ever they have come from, nor am I suggesting that people shouldn’t be free to indulge in sex as and when they please (though not in public, another thing which is apparently becoming, ‘cool’). What I am suggesting is that the West has binged itself out on a lot of stuff it doesn’t actually need, all thanks to endless credit card debt supplied by Banksterville, and in that orgy of greed and extreme sexual liberation we lost our way. We need our children to be loved and also disciplined, not thrown endless bits of crXp to shut them up. We need to cut back on the constant TV violence and sex shows, if not for ourselves then for our young. A start would be banning cell phones in the class room, having zero tolerance for any physical or verbal aggression towards teachers and civilians. If we don’t get back to the vital duality of loving but also disciplining our young then what future have they got? We now have citizens in the West who are in their 30s and have never prepared a simple home cooked meal! So from the top of the Western tree to the bottom, there is the biggest moral deficit in its history. Instead of hating and deriding the word, ‘morality’ we would be wise to embrace it. In fact I think in the collapse you have warned is coming Sir Dave, morality will come back into fashion simply because there won’t be any more, ‘Have it now on credit’ meme. For the first time in two generations people who still have a main meal each day will be truly grateful for it. Instead of killing themselves with drugs our young will be more concerned with a different craving, hunger.

        Multum In Parvo

        • Thanks, Auld. I’m going to try to keep my response fairly short (unlikely for me) because I am hoping to start writing another article today. (Haven’t had much time to write, as I’ve been taking advantage of the summer to do a lot of landscaping around our place and putting in a patio and a sidewalk — simple things that I enjoy but that are labor intensive so that at the end of the day I just want to collapse on the porch with a margarita or a mai tai or a beer and watch the evening settle in.) So, I’ll hit just on your main theme of morality.

          I agree that the terms “morality” and also “righteousness” have taken on a bad flavor so that society has steered away from them. I like the thought of righteousness more than morality, but even that term calls to mind so much moralistic self-righteousness that one can hardly use it in public. To me, what it genuinely means is living RIGHTLY before your fellow human beings. And that is what true morality should be, too; but both terms have been reduced to implying that you can be a good and righteous person just by living according to a hide-bound set of rules.

          I like to look at Jesus for my example and not at the preachings of the church where the latter rule-dominated approach to being righteous has been emphasized. If you take off your church glasses and just read the Gospels, you see that the person who is my prime example lived rightly before his fellow man. He faced off against religious zealots who thought righteousness came by living exactly to the rule sand showed us that, without love and respect for your fellow human beings and humility before them, morality is cold, tedious and even destructive.

          The prime example, of course, can be seen in his actions toward the adulterous woman. The religious moralists of his day put him to the test to see if he would order his stoning because he didn’t seem to live rigidly enough by the rules. From that situation we got the response that, “Whoever among you is perfect can throw the first stone.” Well, none of them wanted to act before their fellow human beings as if they truly believed they were perfect (because they knew no one would buy that), so they all waked off disgruntled that they couldn’t throw rocks at the woman who broke God’s rules.

          Then Jesus said to the woman, “Where are all those who condemn you? I don’t see them. I don’t condemn you either. So, go on your way and sin no more.” He didn’t say that what she had done was O.K. (didn’t just throw the rules away). In fact, he made it clear in a kind way that what she did was wrong; but he didn’t make a big case out of it, and he showed her love and respect and mercy.

          While I don’t go to church, I try to live my life guided by his life everyday. Often I stumble at living up to that, but I find NOTHING in his example of living that I don’t highly respect, though it is far from the easy path.

          He believed in moral living, but he didn’t try to legislate it into being or shove it down other’s throats, nor did he even judge the Roman nation that you mention for all its immorality though he lived governed by that nation during its hay day. He didn’t hesitate to talk about the importance of morality, but the only people he judged harshly were the religious conservatives of his time who shoved morality down other people’s throats.

          He demonstrated that morality by itself does not make one righteous because righteousness is seen in treating your fellow human beings rightly in all respects. (Something we all fail at from time to time but can try to live toward.)

          He gave us simple ways to evaluate if we’re doing that, such as the golden rule: “Do to others as you would have them do to you.” If you treat everyone like you would want to be treated in similar circumstances, you can do no wrong. That doesn’t mean just ignoring the fact that they’ve done bad things, but it means being impartial and just.

          He talked about the “new covenant,’ which was a law “written upon the heart” that everyone could know and understand versus a complex moral code. And what was that simple law the superseded the 500+ laws in the Jewish moral code? One new commandment: “Love the Lord your God with all your heart, all your body, all your mind and all your soul; and love your neighbor as yourself.” If you truly live that, you can do no wrong.

          That simple law even a child can memorize. The Golden rule gives us a simple standard for assessing in each situation whether we are living in that loving manner toward our fellow human beings: how would we like them to treat us if the situation were reversed? It doesn’t mean just showing a lax kind of mercy when we or someone we are standing up for has been wronged us, but it does mean being fair, being honest, being respectful, being impartial, etc. even when we’re addressing someone who has wronged us.

          I think the Gospels open our eyes to a whole way of life that is far from moralistic in the narrow-minded or bigoted sense you describe and that demonstrates true moral living that does not ever look down its nose at others and that is not, on the other hand, beguiled by the religious moralists of the time (nor ever afraid to confront them strongly) who seek to enforce their religious rules on everyone else and who live as guardians of the truth.

          (Well, as i figures, so much for keeping it short. Never my strong point.)

          –David

          • QEternity

            That was short? ;P

            • I know 🙁 I wrote that when I started writing the comment and said, “I doubt I will achieve this aim.”

              (But I did still have time to get the next article written: http://thegreatrecession.info/blog/corporate-culture/ . It follows on the theme above in a practical way, rather than as a spiritual outlook.

  • Edwin Saxon

    Almost 100 million workers got booted out of the so called Labor Pool, because they couldn’t find a job. Only those still collecting unemployment checks are counted as unemployed. Also, how many still working are underemployed? According to the government if you work one hour in a workweek, you’re on the employment list.

    • Auldenemy

      Crazy isn’t it. We are ruled by cretins.

    • amongoose

      My favorite part is the jobs created compared to immigration (legal only), they durn near match.
      Hard to employ Americans when your bringing in that many lower wage workers.

    • You’re right. A great many who lost jobs never got jobs back. Then as Goose indicates, many didn’t come back because they would have to take a job with lesser benefits and lower pay because immigrants were being hired much cheaper to replace them.

      The number of immigrants hired during the Obama administration is fairly close to equal with the number of new jobs created, so guess where the new jobs went. The number of people who fell off the unemployment count simply because their benefits expired or because they quit looking because the pay on the new jobs was so bad compared to what they were used to is huge. So, the new jobs didn’t go to them.

      You can say, “Well, those people should have been willing to take lower pay or go with lower benefits in order to remain competitive with the millions of immigrants who entered the country during that time and got jobs.”

      To do that, they have to compete with people who are willing to live in a tin shack because that is what many of them came from. And we all know that once you downscale like that, it is VERY HARD to work your way back up the ladder. You can erase twenty years of progress in your career by downshifting as far as you would have to in order to compete with that new labor.

      Why do you think the government is so ready to let in so many immigrants and to make excuses for keeping migrant workers here that THEY declared illegal? It’s a way to insource the outsourcing — to help big industry with all those jobs that couldn’t be exported out of the country because they have to be done on location — such as restaurant work, hotel work, farm work.

      You cannot hire people overseas to clean a hotel in Washington, D.C. So, this is how politicians provide the opportunity of cheap labor to their Wall Street cronies who own businesses that have to use local labor. You can move a factory and ship the product to customers here. It doesn’t do any good to move a hotel or restaurant. It has to be where the final customer is.

      And the government pretends to wonder why the middle class is shrinking.

      Is it any wonder economic growth gets smaller and smaller on the graph above over the decades when the middle class gets smaller and smaller. What the wealthy haven’t seen is that they are, by being cheap with labor, eroding their market base. The population is growing, but it’s growing with people who are less and less able to buy their products and services. Eventually, you find you have downshifted to a population that, while it once had disposable income, can now only afford to buy the most meager basics, and your robust market is nearly dead.

      In the end, excessive greed hurts the rich, and they don’t even know how it happened.

      Welcome to the blog, Edwin and Goose.

      –David

    • Auldenemy

      Exactly! I also notice that the USA Labour report includes 1 worker with 2 jobs as being 2 people employed. So a guy who lost 1 decent paying full time job and is now doing 2 low paid, part time jobs gets entered into the Labour stats. as 2 separate jobs created. We have reached the stage of endemic corruption when it comes to all banking, big Corp. and political stats. Everything is skewed to what they want it to be. Reality is denied at all costs (the costs being to us the people). This is what happens when a banking-big corp.- political elite unite as one and get to rule the entire Western Hemisphere.