Bill Bonner comments on the non-miracle of the US economy:
The stock market began its epic march up the mountain in 1982. Since then, it’s gone up 13 times (as measured by the Dow).
US GDP is up about 13 times too.
But much of the “growth” in stocks and GDP in this period was phony. The tape measure, used to track growth, was calibrated in dollars. And the dollars — stretched by the feds — lied.
Just look at what has happened in the last ten years. From its low in the early 2000s, stocks are up about 50%. Investors might think they are ahead of the game.
But measure that increase in terms of gold…and the gains disappear. Instead, stocks are DOWN 16%. In terms of oil, stocks are down even more — 43%.
The so-called recovery is even more phony than stock market gains. Stimulus jolts GDP, but not in a productive manner. Throw enough money into the economy and it will have an effect, just not the same effect as balanced growth. As Mr. Bonner describes it:
And now the feds tell us the economy is in ‘recovery.’ Yes, they admit, it’s not a great recovery. But the economy is growing. And if we wait long enough everything will be put right.
Oh yeah? At this rate the US will never reach full employment. Because, each month, more people are looking for work than finding it. Why? Because little of this ‘growth’ is real. It’s just what you get when you put an extra $2 trillion of cash and credit into the system.