Posts Tagged ‘economy’

Mainstream Media Myths and The Power Of Belief

November 17, 2014

by Simon Black via Zero Hedge,
(in reading this article you have to adjust specifically American reference to fit the current state of the EU, but all the points made apply equally to this side of The Atlantic)
Years ago, an elderly, frail Japanese martial arts master once boasted a 200-0 record against his opponents.

He claimed to have a unique power that allowed him to inflict serious injury on people without actually laying a finger on them.

Was it Chi? Magic? None of the above. It was a total scam. But that didn’t matter.

You see, the legend of the master’s powers turned out to be far more powerful than reality.

His core following of students believed in the master so much that they would fling themselves across the dojo whenever he raised his pinky finger.

And anyone who saw the display would become transfixed by the perception of the master’s extraordinary abilities. It was an incredible case of mass delusion.

Everyone believed it, including the master himself. He was so confident in his skills that he put up a $5,000 challenge that he could beat any fighter in the world.

A mixed martial arts champion accepted the wager, and the result wasn’t pretty. As you can see in the video (below), the master is quickly knocked to the ground with a broken nose and a pool of blood.

You can almost hear the sound of reality quickly taking hold from the gasps of his students. No one could bring themselves to believe that the master had been so quickly beaten.

To an outsider, it seems so obvious that this guy is a phony (just watch the video). But mass delusion is an incredibly powerful force.

We see the same effects in the West today—mass delusions everywhere.

People seem to believe their governments are almighty beings capable of performing magic—water into wine, debt into wealth.

Here are some of the biggest myths we see in the system today:

1. The dollar will continue to be the dominant currency.

This is a total farce. Grumblings grow louder around the world to establish a new non-dollar financial system, and China has taken the lead to make this a reality.

2. The US is still the dominant military power in the world.

If you measure by the quality of trained personnel, this is true. But what good is all of that military power if you can’t afford to do anything with it?

3. The police exist to protect the people.

Wrong again. With so much civil asset forfeiture taking place at the point of a gun (federally funded assault rifles), it’s clear they’re far more concerned about protecting those that maintain the status quo than protecting you.

4. Elections make a difference

Completely false. Most Western governments borrow money to pay interest on the money they’ve already borrowed.

In the US, they spend so much on mandatory entitlements and interest they could eliminate almost the entire government and still not run a balanced budget.

At that level of desperation, it matters not who’s in power.

5. Your bank is safe

Your bank might HAVE a safe. But if you look at objective data, many banks in the West have incredibly thin levels of capital and liquidity—the exact opposite of what a safe bank is supposed to have.

Oh yeah, they’re backed by poorly capitalized deposit insurance funds, which are guaranteed by insolvent governments.

And bear in mind that even if your bank is reasonably capitalized, you are still guaranteed to lose money on a tax adjusted, inflation adjusted basis if you you’re holding your savings there.

6. You have to go to college in order to get ahead

Quite the opposite—going to college in many cases can get you behind; just ask any 36-year old still paying down that $100,000 student loan debt.

The world is a big place full of opportunity. Skills and experience matter more than pieces of paper.

Here’s a better option, especially for young people: head overseas, and become an apprentice to a successful, knowledgeable individual that you respect.

Any young person who thinks that going to college is a good idea should just ask any of their unemployed friends saddled with $100,000 of debt if it was worth it.

7. I saw it on TV so it must be true.

Ufff. The mainstream media exist to paint a distorted version of reality so that people are kept placated, docile and largely clueless about what really goes on in the world.

8. Debt doesn’t matter because we owe it to ourselves

Whoever first said this must have a lot of whips and chains in his closet because he seems to enjoy pain.

If we owe the debt to ‘ourselves,’ that means that we will need to default on ourselves.

This means no more Social Security, Medicare, etc. It means causing the US Federal Reserve to become insolvent and spark a currency crisis. It means causing the collapse of every bank in the country.

Sure, no biggie.

9. The United States is the Land of the Free

Draconian surveillance efforts on its citizens. Punitive taxes, fines and regulation. Rising police state. Telling people what they can or can’t put in their bodies, how to grow their food, who to adore, who to hate. Preventing them to collect their own rainwater and live off the grid.
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How Prostitutes And Drug Pushers Are Driving Economic Recovery

July 4, 2014

prostitutes boost gdp Entrepreneurs working to boost GDP (source)

Back in May Italy started a trend by announcing a plan to “boost” its GDP figures through the simple expedient of adding the estimated impact of cocaine and hookers.

(A note to the economically illiterate here, NB Ed Balls, Vince Cable, George Osborne and that bloke who looks like Scooter from the muppets – GDP is not a measure of how well an economy is doing but only of how much money is churning around in it. This is where post Keynesean economics fails, economists are so thick that can believe that by raising taxes to produce £300million revenue, importing a million immigrants and paying then £300 a wee in benefits actually grows the economy by £600million a week.)

Riding on the back of this pros, pimps and pushers economic gimmick to make the economy look better Britain, the – ahem – most successful economy in Europe at the moment – ahem – has decided to get in on the act. The Office for National Statistics will in future also include the “contribution” made by prostitutes, pimps and drug pushers to make its GDP look a little stronger. Really, I wasn’t aware prozzers and pushers had started registering with the Revenue and charging VAT. And as we are talking of Value Added Tax, in the case of commercial sex surely the value is added by the punter and not the vendor after all beauty is in the eye of the beholder.

According to The Guardian “for the first time official statisticians are measuring the value to the UK economy of sex work and drug dealing – and they have discovered these unsavoury hidden-economy trades make roughly the same contribution as farming – and only slightly less than book and newspaper publishers added together.”

How big of a “contribution” does ONS expect the good, old fashoned “vice” make to that Holy Grail of irrelevant economic statistics, the GDP then? I wan’te Here are some quotes from ONS documents:

Illegal drugs and prostitution boosted the economy by £9.7bn – equal to 0.7% of gross domestic product – in 2009, according to the ONS’s first official estimate. A breakdown of the data shows sex work generated £5.3bn for the economy that year, with another £4.4bn lift from a combination of cannabis, heroin, powder cocaine, crack cocaine, ecstasy and amphetamines.

Did you spot the problem? Since one can’t report on a tax return that the source of income is have paid sex or selling illegal drugs, the ONS has to to estimate the economic contribution by these illegal professions. This is how it has gone about doing it:

According to the estimates there were 60,879 prostitutes in the UK in 2009, who had an average of 25 clients per week – each paying on average £67.16 per visit.

Really, £67.16? Do prostitutes use per second billing like phone companies?

So complex are the billing methods of those who trade illegally (whatever happened to the cavalier approach to accounting displayed in “The Ling Good Friday” expressed in the line “Give ’em a grand for the inconvenience.”) an excel spreadsheet model has now been created to calculate the hypothetical GDP boost to the nation is. Making things even more surreal, and confirming the GDP calculation is officially a statistical joke, here is how drugs are accounted for:

The statisticians reckon there were 2.2 million cannabis users in the UK in 2009, toking their way through weed worth more than £1.2bn. They calculate that half of that was home-grown – costing £154m in heat, light and “raw materials” to produce

The models will need updating constantly, sex and drugs being about the only truly free market activity, cost and prices vary constantly according to supply and demand. The ONS says:

“Our agents will work in the coming months to bring the data more up to date. The figures will then be included in the broad category of household spending on “miscellaneous goods and services” alongside life insurance, personal care products and post office charges.”

It is unclear if the ONS will pay for its agents to conduct due diligence in various brothels, or alternatively conduct “inhouse” sessions at the headquarters. What is clear is that quite soon the largest marginal provider of “growth” not just in Britain but all of Europe will be illegal activities:

Alan Clarke, a UK economist at Scotiabank, said that although the government would not feel the benefit of illegal work in terms of income tax take, there would be a spending boost. “A drug dealer or prostitute won’t necessarily pay tax on that £10bn, but the government will get tax receipts when they spend their income on a pimped up car or bling phone.”

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USA, Russia and Sanctions: The Real Situation

March 14, 2014

Yesterday someone commented on my post about the threat of the Ukrsine dispute turning into economic warfare, that the USA would be immune to economic fallout from any trade war because the world trades in US dollars. Now knowing what I do about the dross printed and broadcast by US mainstream media, I could not criticise anybody for clinging to this piece of propaganda, but in reality the situation has been changing for some years.

So when you read reports that Russia is ready to hit back with counter sanctions against the EU and US should they try to use economic measures to force the Kremlin’s hand on the Ukraine issue, be afraid. Since the start of the Iraq war, the economic landscape has changed enormously. The USA is no nearly as dominant as it was, due to the actions of the last two US administrations Uncle Sam has little goodwill to trade with. China has already recealed plans to replace the US$ with a new reserve currency and simlar plans have been discussed in G20 sessions because of fears about the systemic weakness of the US economy.

The President and Scooby Doo villain Secretary Of State Kerry are not in a strong enough position to indulge in sabre rattling.

“We hope that there will only be targeted political sanctions, and not a broad package affecting economic trade, “Our sanctions will be, of course, similar, ” Deputy Economic Development Minister Aleksey Likhachev the Russian Economic Ministry has said .

One way Russia will use to protects its economy from sanctions is by shifting settlements of bilateral trades to other currencies. China and Iran have already taken the lead in this, following a move by the late Saddam Hussein which I blogged on some years ago (How Saddam May Yet Win The War ) The old tyrant was merely giving the finger to bill Clinton’s White House but he established a precedent that others noted.

America’s vulnerability to attacks on the dollar is summed up in this comment made by Aleksey Ulyukaev, the Minister of Economic Development said in an interview with the Vesti 24 TV channel.

“We need to increase trade volume conducted in national currencies. Why, in relation to China, India, Turkey and other countries, should we be negotiating in dollars? Why should we do that? We should sign deals in national currencies- this applies to energy, oil, gas, and everything else,”

The Duma, Russia’s parliament, is drafting legislation to allow Moscow to freeze assets of Western companies and individuals in the event sanctions are imposed following the Crimea referendum vote on March 16.

#Such a law would give The Kremlin “opportunities to defend our sovereignty from threats,” according to its author, Andrey Klishas, as quoted by RIA Novosti on March 5.

With Russia and China already dumping dollar reserves and US Treasury bonds this could easily spell trouble if Obama and Kerry are not careful. The US Congress has already denounced Russia’s actions in Ukraine. Last Tuesday, congress approved a resolution that urges The White House to “to work with our European allies and other countries to impose visa, financial, trade and other sanctions on senior Russian Federation officials, majority state-owned banks and commercial organizations, and other state agencies, as appropriate.”

Earlier this week the European Union threatened to impose further sanctions on Russia starting on March 17, after the referendum in Crimea takes place on Sunday. Speaking to the German parliament, Chancellor Angela Merkel hinted sanctions would be needed if Russia “continues its efforts to annex crimea or bring down the EU supported rebel government of Ukraine. Merkel warned that if Russia does not back down the result would be to change the European Union’s relationship with its neighbour. She is right of course, Germant depends on Russian gas, if Putin turns off the tap it would quickly cripple the German economy.

The real clincher in determining how the Ukraine confrontation will play out is China. Seemingly far removed from this dispute, China would appear to have little to gain from involving itself in a dispute between the western powers and Russia. China’s ambassador to Germany Shi Mingde, has warned however of the global economic affect sanctions against Russia could hold. Mingde said the geo-political tiff between Russia and the West could “spiral” into chaos (by whih he probably means a shooting war or an economic crisis to make 2008 look like a short term cashflow problem).
President Putin and the Russian foreign ministry have both said sanctions against Russia could backfire, and spill over into the global economy and Moscow’s Foreign Minister Sergey Lavrov denounced any “hasty and ill-considered” sanctions as being likely to cause “mutual damage”.

Iran-style sanctions on Russian trade appear impossible because the EU would be much more exposed than the US and as Putin has warned, the American economy would be massively exposed should Russia decide to dump the dollar reserves it has built during years of exporting gas and oil.
The European Union nations import around a third of their gas and many other natural resources from Russia, and several nations are completely dependent on Russian gas. The US and Russia trade very little so it is difficult to see what harmful effect US sactions could have (but since when did Barack hussein Obama, the ego on legs, think through such foreign policy subtleties), but Russia is Europe’s biggest customer, and the $13 trillion EU economy would de devastated if trade with Russia was halted overnight.

So to summarise, collapse of the dollar, crippling of the EU economy and global financial chaos and the presentation to China of an enormous opportunity; does anyone still think the US has no need to fear the consequences of economic conflict with Russia? On the other hand, Russia is not truly a democracy, The Kremlin will simply tell citizens any hardships they face are due to the evil western nations and anyone who questios that had best get their affairs in order. Simples.

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The Truth About The Economy, Crime, Education And Everything Else.

January 26, 2010

Increasingly desperate as all their efforts to stem the advance of the BNP in barking, Barnsley and Burnley seem to amount to nothing, the Labour government has resorted to its favourite tactic: telling lies.

This month alone they have told lies about Swine Flu (apparently hundreds of people who lived near you have died of it) ; the have claimed unemployment has started to fall when in fact the only reason the figure was lower is that they stopped counting people whose benefit has been suspended because they have not tried hard enough to find jobs; today they announced the economy is out of recession and growing once more though the 0.1% growth in the final quarter of the year was achieved as a result of the government’s manufacturing monopoly money to a sum equal to about 10% of the gross domestic product and giving it to banks, public service contractors and foreign car manufacturers.

The most outrageous lie however has been the claim that “reported” crime has fallen. Nobody now reports crime as they fear they will be arrested and charged with not being polite enough to the burglars who have broken into their house and are stealing all their stuff. Added to that, Labour’s Politically Correct Thought Police, knowing that most crime is committed by males aged 12 – 24 stopped counting crimes committed by the under 16 because the poor little darlings don’t understand mugging and housebreaking, twocking and setting fire to property is wrong.

What is really off – pissing about the Labour government, and let’s not delude ourselves the Conservatives will be any different when they are in power, is they persist in the irrational belief that if they chant statistics over and over again the only people who will not believe them are the most misanthropic and congenitally evil supporters of the rabid right. People who do not believe official statistics are insane, Gordon Brown more or less said a few months ago.

Insulting the punters by calling them stupid is bad enough, saying they are insane is suicidal. It is not the people who refuse to believe statistics that are bonkers but those dwindling few Guardian writers who believe the statistics put out to make the case that Labour politicians are really nice people who are doing a good job in very difficult circumstances.

If you are one of those people who clings to a lingering feeling that Labour can’t be all bad because they care about minorities, orphans (so long as they are not British orphans) and foxes, her is an example of how statistics are made to tell lies.

A recent report complied by a left wing think tank to address the appalling take up of GCSE A level courses in Languages complained that criticism of the state education policy on Language courses is unfair. Yes it is correct to say A level pupils in private schools got a lot more good pass grades in languages than state school pupils. “Look at the statistics,” they whined, “80%of pupils in private schools take at least on A level in a foreign language, only 40% of state school pupils are entered for the exams. No wonder the private education system gets better results.

Let’s re – examine that in a computer professional’s logic rather than New Labour logic. The number of pupils in private education in 7%. The number of pupils in state education is 93%. So 80% of 7% is … I could never be arsed with maths, let’s say about 5.5% and 40% of 93% is roughly 37%. This means five and a half percent of pupils got more A level grade A and Bs than 37%. And that is a case for banning private education?

The idea of the old Grammar Schools, the selective education so hated by the “Progressive Left” was that bright children from poorer homes who have as good a chance of getting on as those whose parents could afford private education. As usual it is a case of the left in trying to be fair to everyone ending up being unfair to everyone but trying to conceal the facts with bogus statistics. And the Conservatives were just the same last time they were in power and will be again. The audacity of their claims that the voters are too stupid to understand official data is one of the reasons people have lost faith in politics, the professions and everything.

The reason the Conservatives are losing votes universally to UKIP and Labour is losing votes to the BNP in Barking, Barnsley and Burnley ( not to mention Bradford and Birmingham), to the Lib Dems in Lichfield, Luton and Littlehampton, to the Greens in Gateshead, Garstang and Gillingham and for all we know to The Hurricane Party in Hertford Hereford and Hampshire is not because the voters there are drawn to alliteration (in fact few of the 97% educated in state schools are likely to know what alliteration is) but because they think the punters are so simple minded they will believe any old bollocks if it is backed by a few official statistics.

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