All Show, No Substance
You want to see how grotesque national politics has become? Check out this passage from an AP story (emphasis added):
Pelosi and four committee chairmen met with the president Wednesday as they scrambled to resolve differences between sweeping bills passed by the House and Senate. The aim is to finalize legislation revamping the nation's health care system in time for Obama's State of the Union address early last month.
They're rushing through the legislation so Obama can glow about it during his State of the Union address? I heard that rumor last month, but thought to myself, "The Democrats will deny it." Now it appears that it's common knowledge and the Democrats don't even see a reason to deny it.
While it's disturbing that the legislators would have such a goal, it's bewildering that such shallowness is candidly admitted and accepted. The response from the electorate to such revelations is a collective shoulder shrug. We've become numb to such outrage, just as we've become numb to the maze of regulations and taxes that hit us every hour of the day.
I have no doubt Republicans would do the same thing, incidentally, so please don't dismiss this post as a party rant. It's not. I just wish politicians would at least pretend they have a semblance of virtue and integrity.
The Coming W?
I really like it when one favorite online source cites another online source, kinda like the way Mangan cited Zero Hedge yesterday. When that happens, I feel like I'm getting corroborated information. It happened yesterday, when Randall Forsyth at Barron's cited John Williams at Shadow Government Stats.
And he wasn't citing him for anything good. In fact, it's bad: The real supply of money is shrinking, the Fed's contrary attempts notwithstanding. Every time that happens, the economy crashes. Meaning: It looks like we're heading for a W-shaped recovery, the second down-leg of which we'll be seeing shortly.
[F]our years ago the Fed ended tracking the broadest measure of the money stock, known as M3. To fill that gap, John Williams Shadow Government Statistics (www.shadowstats.com) estimates M3 from published sources as part of his mission to strip away the obfuscation prevalent in many government economic statistics.
The Fed still publishes the narrow measure of money, M1, consisting of currency and checking deposits; M2, which adds consumer savings and money-market accounts, and MZM, or Money of Zero Maturity, which includes M1 plus other accounts with check-writing privileges, such as money-market funds.
But M3, which takes in savings and institutional deposits, arguably is a superior measure of the liquidity in the economy. During the credit bubble from mid-2005 to the beginning of 2008 (just when the Fed stopped publishing M3 data), the broad money measure soared, attesting to the gusher of liquidity evident to all. The official M's failed to reflect the massive liquidity expansion during that time.
Now, Williams writes, SGS' estimate of M3 is signaling the opposite; it is shrinking in real terms, that is, after adjusting for inflation. That's happened only four times before last November, and each time it signaled either the onset of a major recession or a sharp deterioration in a contraction already underway.
