The economic cycle is way too long!
Last year, Jim Rodgers predicted the U.S. would be in a recession. 100%
I don’t understand how it is possible that the U.S. isn’t in a recession already. Or is it, and it is all being covered by fake news and fake data?
Here is what we know:
1. We have 96 Million people looking for work
2. Shadow Stats show that the unemployment rate is 20% and hasn’t fallen
3. 40 million-plus Americans are in poverty
4. The jobs data was faked under President Obama, and we need to investigate this issue.
5. Gold will go to 5,000, heck, 10,000! (Buy Jim Richards book to find out why!)
6. CPI inflation data is bogus. Inflation rates are much higher.
7. Americans have 1.3 trillion dollars of student loan debt and over 1 trillion dollars of auto loan debt. Do we need any evidence that the system is collapsing?
8. Harry Dent said so.
9. Too many men are sitting at home playing Game of War instead of working. They won’t leave their parents’ basement, stunting economic consumption.
10. We are 20 trillion dollars in debt, that is with a freakin’ T, damm it. What is wrong with you people? 20 trillion dollars in debt!
APRIL FOOL!
I just listed a lot of the worthless anti-American alt-fact garbage that has been seeping into the drinking water since 2009. Here is a more realistic look at the economy that may not appeal to the drama queens who prefer a mentally incoherent worldview.
1. Myth: 96 million people are out of work.
Reality: If you count the total non-farm payroll and then add the 20% of working Americans (farm payroll) & private household employees, we have 153 million-plus people working. Unemployment claims are at 4-decade lows. Job openings are at 5.6 million. If someone you know, who was fired in 2008, has sat home for 8 years, thumbing their nose at the job market because it doesn’t pay enough, that is on them. We lost 8.8 million jobs in the Great Recession but created over 16.2 million since then; almost all of them have been full-time jobs. Please circle the timeline where we lost 96 million workers who are now looking for work!
2. Myth: Shadow stats show an unemployment rate of over 20%.”
Reality: Shadow stats are called shadow for a reason. They are smoke and mirrors. These fake data show that the unemployment rate has been over 20% since 2008. I don’t have the heart to put up their chart because it’s embarrassing.
3. Myth: More than 40 million people are in poverty. This is true, but the data should be interpreted in context.
Concentrated poverty is the biggest issue in America from my perspective. For years I have stressed the importance of education, training, and even a job guarantee program as a means to fight poverty. High school dropouts, especially those with substance abuse issues, are doing horribly in this economy and require federal intervention. On the other hand, educated Americans are doing just fine.
More information on poverty in America can be found in this article:
https://loganmohtashami.com/2016/09/13/positive-u-s-wage-poverty-data/
4. Myth: Under President Obama, the jobs data was faked:
Reality: President Trump recently addressed this issue, and now all the jobs data is real; problem solved!
5. Myth: Gold will go to 5,000 heck 10,000. Buy Jim Richards’s book.
Reality: Same story in a new, shiny gold cover!
Before and after
6. Myth: CPI inflation is bogus. Inflation is much higher.
Reality: This one is kind of embarrassing for the inflation hawks. Inflation hasn’t had a core 3% headline print this entire century. The world is dealing with demographic deflationary factors, and Germany and Japan have a lot of debt priced in negative territory.
From Doug Short:
https://www.advisorperspectives.com/dshort/updates/2017/03/31/two-measures-of-inflation-and-fed-policy
Even though the inflation hawks got everything they wanted for Christmas (20 trillion in debt, significant deficits, 4 trillion in #QE, and not one core print over 3%), they still can’t get inflation to budge. Alas!
7. Myth: Americans have 1.3 trillion dollars of student loan debt and over 1 trillion dollars of auto loan debt, and this alone will make the economy collapse.
Reality: Let’s put this into perspective: a) 70% of student loan debt is under 14K; 13% is over 50K, and 3% is over 100K. Forty percent of the total student loan debt is from Grad students. However, college dropouts account for about 30% of all student loan debt, and many of these loans go delinquent with an average balance of 9K. The rule of thumb is that despite your student debt, you will have to earn power with that degree if you finish school.
College Education = Income and work
Also, regarding auto loan debt, the subprime portion of this sector isn’t as significant as you think. Unlike the housing boom and bust, the underwriting for car loans is much different. The exotic debt structure of housing subprime loans is unlike the relatively straightforward car loans of the past eight years. When manufacturing went into recession, we did see an uptick in car delinquencies in those oil states. A lot of the economic damage done by the stronger dollar and the crash in oil prices has passed. Look for delinquent trends, but don’t equate repossessions to foreclosures.
8. Myth: Harry Dent said so, so it must be true.
Reality: Harry Dent has been so wrong for so long that he will run into his own stronger demographic timeline by the year 2020—ouch! But until then, expect another massive whiff for 2017, as this was yet another year the great Harry Dent called for a collapse.
9. Myth: Too many men are sitting at home playing the Game of War.
Reality: This means more money for app makers, and working people will continue to consume goods and services.
10. Myth: We are 20 trillion dollars in debt, and the end is near!
Reality: We also have nearly 20 trillion dollars in GDP and 125 trillion dollars in financial assets and GDP combined. We have borrower rates near all-time lows, and the Dollar is still the king dollar worldwide.
For those of you still eager to belie that a recession is just around the corner, here are some real things to look for:
1. Find a significant sector with a high multiplier that is heavily over-invested. You can’t have a recession without this.
2. Look for leading economic indicators to fall for 4-6 consecutive months.
From Doug Short
https://www.advisorperspectives.com/dshort/updates/2017/03/17/conference-board-leading-economic-index-february-highest-in-decade
3. Look for a rise in unemployment claims across multiple sectors.
4. Look for the Fed to take steps to fight inflation – this indicates some sectors are overheating.
5. Remember that none of the above factors have happened yet!
And lastly, let’s remember that the election of Donald Trump did not create a stock market crash, as David Stockman predicted. In contrast to the flaming Twitter-sphere, the stock market has been in one of its quietest periods in recent history.
Wait… I forgot one more thing.
Every year around this time, we get the very subpar 1st quarter GDP print, and all the bears scream that the recession is coming. Since 2010, we have averaged a sad 1% GDP print, and no depression has come from it once.
If you only shared this article because of the headline and didn’t bother to read it, you’re the bear I am talking about.
This is America, folks. Don’t bring that weak anti-American RT pro-Russian garbage in this country!
Logan Mohtashami is a financial writer and blogger covering the U.S. economy with a specialization in the housing market. Logan Mohtashami is a senior loan officer at AMC Lending Group, which has been providing mortgage services for California residents since 1987. Logan also tracks all economic data daily on his own Facebook page https://www.facebook.com/Logan.Mohtashami
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