Sometimes When I Read Economists My Brain Hurts
And it isn’t because of their fancy math or their impenetrable jargon or even their arrogance.
“We’re in a puzzling economy,” Shiller told Bloomberg TV.
The kindly professor sounded genuinely befuddled, which left me wondering how an economist can be puzzled as to why the economy isn’t working when its flaws are more obvious than the wrinkles on Tommy Lee Jones’s face.
Then I read today that most economists are bullish on the present economy and that Goldman Sucks believes a recession is YEARS away. Business Insider published “Six Signs that We’re NOWHERE NEAR a Recession,” claiming most evidence supports a belief that recovery will continue for some time.
Seriously? The entire global economy is writhing in the dust of its own decay all around them, and these economists not only believe we’re not going into a recession (even though much of the world is already known to be in one), but they are so blind they think the wolf is years away from the door! Wow!
I see a global economy that is crashing like an airliner into a mountainside. That it has to crash is painfully obvious to me as a bystander who is powerless to do anything about it. It is a 747 flying low into a three-sided mountain valley. I can see at a glance — and so can you — that it has nowhere to go. How can it not crash? We know that something so large cannot climb or turn in the short and narrow space it has remaining — so we are glued to watching it crash. The situation has that “Oh my God” inevitability of disaster about it.
This particular plane is filled with pilots en route to a global convention. They are all trained to fly 747’s, but we can see that they’re all sitting back in the cabin watching the mountains go by. They’re looking out the windows in party hats (see photo above) and gleefully toasting the mountain peaks that tower above them, saying, “Cheers to a wonderful flight ahead and the lovely scenery.” And no one is flying the plane. Somehow the fact that there are glaciers above them, rather than clouds, doesn’t even register as a warning sign. All they can say is, “Isn’t it lovely?”
The plane full of fools is the global economy, and the foolish pilots are all economists who should have been correcting course long ago; but their brains are as dense as lead, and you cannot fly over mountains of debt in a plane full of leadheads. These economist have piled up debt all around us (by advocating such practice as a plan for healthy economic growth) and are now riding the plane straight into that debt. The piles of debt around the world look like the Himalayas. Yet, the econopilots cannot even imagine that the leaden economy they’ve left on autopilot is struggling to gain enough altitude to clear its own mountains of debt — the highest mountains humanity has ever seen.
Some of us could see the Great Recession coming before it got here. We saw the mountains of debt piling up around houses and saw that prices had stopped climbing. We KNEW that meant disaster lay shortly ahead. Yet, experts like Shiller apparently still haven’t figured out why it happened in hindsight!
How is it possible that so many economists can be so ignorant as to believe that an economy engulfed in its own mountains of debt could ever be a healthy economy? How could Shiller possibly believe that creating trillions of dollars of fiat money and giving it all to the richest people on earth would possibly EVER create hope of building a vibrant, stable economy? If he cannot recognize a course charted for catastrophe, what good is he? If he can, then what is there to be puzzled about?
What’s mind-boggling is the minds of economists. How can they be so opaque? Apparently no light, no matter how intense and laser-like, can penetrate those black holes. How can people with high IQs be this stupid? The tree tops of recession are already thumping against the bottom of the plane, and those who claim to be experts on economics are looking out the windows once again and claiming they cannot see trouble at all. “Trouble is nowhere in sight!” Well, maybe buy zolpidem australia they need to get their heads out of the clouds and look down because it’s closer than they think.
One of the supports these economists give in the article I read today to their fantasy that recovery has YEARS of good news in store for us is that “manufacturing surveys signal growth.” I don’t know what survey they’re reading, but the news I’ve been reading and reporting here presents an entirely different landscape — the kind where the trees are already scraping the wheel wells: Sales of airliners are down about 40%. Caterpillar has been in serious decline for fourteen months straight. Hitachi just announced major cutbacks in manufacturing due to serious decline in its heavy machinery sales. Komatsu signals the same trouble for its heavy-equipment manufacturing. Cummins is terminating jobs to reduce production of its diesel engines. The world’s largest steel companies are starting to feel the pinch with Sinosteel unable to pay its bonds. GE is struggling. Even the computer industry is facing weakness. But, oh, manufacturing is looking like the recovery has years of good news ahead of it!
That’s the same easy-credit bubble that was created in housing! How can people not see that it is exactly the same thing — only in cars? In fact, counting leases as sales, means the figures are artificially pumped up on top of whatever the bubble financing is bringing in.
Moreover, how can people not see that this was the same nonsense that got automobile manufacturers in trouble during the last economic crash? It’s why they went down at the same time housing went down. They had been giving out zero-interest, zero-downpayment, zero-payments-for-a-year loans to keep pumping up their bubble, and the result was the we had to bail them out. Auto loans and leases were as subprime as home loans. And that is the case again.
I remember a conversation with my exwife during the years of insane auto financing when I asked, “If this is what they’re doing this year to pump up auto sales, what’s their end-game for next year when everyone in the world has taken advantage of essentially free cars — cars that they can walk away from in a year when they have to actually start making payments — so there’s no one left who wants to actually BUY a car next year?”
And it was a little over a year later that the auto industry crumbled. Because we bailed them out, however, they faced no moral hazard, so they’re doing it all over again! The amazing part is that we’re letting them. More amazing still, most economists are so painfully blind, they laud this lunacy as an actual sign of a vibrant, recovering economy. Yay!
A sign of recovery? No. It’s a sign of a huge future mess that we are headed straight into, and one that we are without excuse for allowing because we’ve been there, done that already. Yet, here we go again! Geeze, humanity is dumb!
I don’t know what’s in the punchbowl on that airplane. These economists have to have either drunk a boatload of stupid or have to be utterly corrupt — deliberately falsifying stories about the economy in order to try to inflate their own investments. In the case of Goldman’s sacks of gold, it’s almost certainly the latter. But Shiller doesn’t seem to be pumping anything up, so it’s stunning that he could be waffling on about what a puzzle this economy is.
No, it’s not a puzzle. It’s a mess! It’s a mess so obvious that the only puzzle is how it keeps flying at all.
This ignorance displayed by most economists is why I write my own predictions — just to upstage the fools and say later, “I saw it coming, and I’m on record about that. So, it is possible to see it, and I’m not even an economist. Therefore, WHY COULDN’T YOU? What – on – earth – is – wrong – with – you?”
The density of such smart people puts a painful knot in my left brain when I read them.