So I’m often asked whether I really believe that government and policymakers intentionally create laws and policies that hurt the people and help themselves. My answer is typically that “if you’re asking me this question you know I do but you don’t believe me; so either do your own research or continue to live in the world as you wish to perceive it. I’m not here to beg you to open your fucking eyes”.
I started this blog about 18 months ago and I have chosen to provide my research with no income attached to it. It means I have no axe but the truth. I spent 13 years in major international banks and have been on both sides of the double edged sword that makes the financial services sector a place to reap riches and also to be thrown to the wolves. That is, I am intimately familiar with the system. That said, what I’ve discovered is that really very little effort is required to see the world for what it is.
The closest analogy is probably best left to Orwell with Animal Farm. Humans around the world have been molded to believe they are part of a system to enable them to get ahead. While some do manage to find a path that has substantial monetary rewards the vast majority (and growing) have, whether they realise it or not, succumb to a role of Boxer, the cart-horse.
That is, our lives revolve around putting in 8 to 10 hours of labour each day for which we receive enough to feed ourselves and our families, have a warm place to sleep and some of us are able to obtain some credit from which we can enjoy things like new cars every few years (while rarely actually owning them). However, in terms of reaping rewards we sew, it is simply not reality. The current system has a clear economic hierarchy which began taking shape centuries ago in Europe. The problem which seems to exist is that people are willing to look at a calendar, see that it’s Thursday but believe almost any (false) figure of authority who says it’s Wednesday. Let me give you an example.
The official’s unemployment figure is now down to 4.9%. However, the U3 unemployment calculation, which is the one touted in mainstream media, excludes anyone unemployed that has not looked for work in the last 4 weeks. That’s right, so if you don’t have a job but you looked for a job 3.5 weeks ago then you are considered unemployed. However, if you are unemployed and haven’t looked for a job in 4.5 weeks you are no longer considered unemployed, you simply no longer exist according to the U3 figure. The result is that after 4 weeks of not looking you fall off the radar and the U3 figure goes down. Wonderful metric eh?
In order to see if people falling off the radar have found work or simply no longer exist we can look to labour force. When we do it becomes clear that while U3 is moving down so too is labour force.
This means people are not finding work they simply disappear out of the labour force and so no longer exist according to the unemployment figure we all follow.
Looking at the U3 chart we find another interesting pattern.
Notice that there does not appear to be a steady state of ‘full employment’. That is, unemployment declines until it explodes higher into a recession. So the argument that simply appealing to the U3 figure as a forward looking gauge is nonsense. Currently we are in the second longest pattern of decline (peak to trough) without entering a recession. This is concerning because all hard indicators are now showing recession. So in this sense the historical U3 figure too is signaling we are overdue for a recession.
But isn’t it just easier to accept whatever meme of happiness is being disseminated by those in charge? Well let me bring this back to Animal Farm. We are sold the American dream. We are told the market is at all time highs and are led to believe that means Americans are doing fine. We are told to continue to do our part to keep America strong and that means get out there and buy stuff and if it’s debt you need to do so well then it’s debt you shall have! As long as you have stuff you should be happy.
And this continuous message of “you are doing just fine but if you’re not, well everyone else is so it must just be you” prevents most of us from even attempting to explore the truth. For what if it is just me that is failing?? I surely wouldn’t want to expose myself as not keeping up. But the real message is there in the background.
While the Pigs whisper words of encouragement into your ear their real message sits ever so faintly behind the facts. The truth so very clearly is that we have become nothing more than Boxer, the cart-horse for whom the Pigs recognize must be kept warm with belly full but beyond that all equity from your labour and all profits from your debt will go to them. Remember true capitalism has a natural relationship between profit and labour, but our existing policies have nothing to do with capitalism. Our policies are designed by the Pigs for the Pigs. Why can we not see that?? It’s right there, now in front of you, have a look. Stare at it for a moment and contemplate the implications if what I’m saying is true.
So continue to accept that unemployment is 4.9%, continue to accept a Fed manipulated all time high market indicates American workers are strong, continue to accept that 30 years of debt inflated GDP defines economic prosperity, continue to ignore the furnished facts and continue to accept the lies from the Pigs and you will continue to forge the chains of which your grandchildren will wear. And while I recognize this all sounds very dramatic I expect you haven’t seen nothing yet.