From Land Of Opportunity To A Fool’s Paradise

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I am amazed daily to see just how many adults (never mind the teenagers) seem absolutely oblivious to their surroundings. Seemingly intelligent people walking with their heads down flailing away on a keyboard built for ants either trying to find out “what’s happening” in the world or, to let the world know on some social networking platform what they ate for dinner, if they just showered, or posted their 2,375 picture of themselves in a compromising pose or situation.

They tweet, post, paste, share, spread, etc.,etc.,etc. But ask them a question about a relevant subject such as the economy, state of global affairs, or more that might impact their future? You’ll just get a blank soulless expression of bewilderment.

You know that look, it’s the same look you get when one of these clueless figures walks right into you in some store or mall. Do they say sorry? Or, excuse me?  No: you just get the animatronic look that says ” Weren’t you watching where I was going?”

Sorry too say, that’s what you’ll hear people saying who put more into exercising their texting dexterity than their educating or informing themselves with useful information. Information which they need to know and understand so they can apply it to their personal well-being. Not their personal “page.”

Social media along with near instantaneous news feeds have given the allusion to a great many that they are “informed.” Nothing could be further from the truth. And in many ways it’s becoming not only dangerous, but could turn catastrophic for these same “informed” individuals.

Most truly informed people today (which you are) know that what is being reported, how it’s reported, how it’s manufactured, and all the other ways data of today is being manipulated that one can not rely on the once deemed “reliable sources of information.”

Today far too many are only taking in the “headlines” along with what’s known as “headline numbers.” This is an abject lesson in Tom Foolery.

Be it as it may that the markets are at lifetime highs along with unemployment prints of under 6%. If you believe as Janet Yellen stated in her latest FOMC conference that we’ll be at “full employment” in a little over a year from now without questioning or understanding how, along with looking at these markets without wondering how and why – then maybe this is “paradise.” However, I doubt that is what it will be in the not too distant future.

As I have stated many times over the years one of the most important reasons that needs to be understood above all with the Federal Reserve’s intervention into the capital markets is the very fact – they enable both the political class, as well as other policy makers from attending to making sure intrusive, job killing, business stifling, or other entrepreneurial based impediments are either not made law – or repealed out of law. Whether that be taxes, regulations, et al.

This point for a long time seemed to have been falling on deaf ears. However, now with so many once “touchstones” as to gauge the health of the economy so utterly “off the charts” such as the indexes, others are now beginning to call out this glaring danger. One such person is Stephen Roach. In a recent article he also opined the following:

“Moreover, the longer central banks promote financial-market froth, the more dependent their economies become on these precarious markets and the weaker the incentives for politicians and fiscal authorities to address the need for balance-sheet repair and structural reform.”

Again to make my point: what is happening away from the adulterated headlines and at the root of business is there are changes about to imposed on businesses as well as others that are going to have dramatic impacts on business creation, expansion, hiring, and a lot, lot more.

A few examples of what is possibly coming down the literal “pipeline” is just how fast all the good news in the employment front just might turn around near overnight and go from good straight to; how can this be happening?

Oil as of today is in free-fall. “Great news to consumers” you’ll read in the main stream media (MSM). Yes, it is. Yet, that decline in fuel savings will not turn into a windfall for spending on new trinkets or electronics that this same MSM will laud over. For a great many it will barely cover the increases in their newest round of healthcare premium increases. But not too worry – the MSM loves that new consumer spending report, and that factors in your new bill to their new-found narrative: Everything is just wonderful!

Then there’s that unemployment number. Forget all the “not counted” souls any longer. How about the ones that they do count? You know where they all work? In the oil business in one form or another.

As I stated in an earlier article We Forget All Too Fast… once you see the beginning signs, things can move very quickly. And we are beginning to see those very signs.

Here are just a few: US Oil Well Permits Collapse 40% in Nov., US Oil Rig Count Tumbles, Drilling Cutback…Forced to Scrap Rigs. These few are not just for the sake of a headline, but have actual empirical data. I’ll also bet dollars to doughnuts those are headlines that won’t be shared or seen on a government supplied phone.

With as abstinent or what some might say “out right hostile” view of the fossil fuel industry as this administration has both proclaimed, as well as demonstrated itself to be: How does one think the view will be when these once job creating states or areas suddenly find themselves in dire straights if this perfect storm of low oil prices, along with low demand, and high yield financing collide?

Will they leave the heavy lifting (if there’s anything left to lift at all) to the Federal Reserve? Because if jobs in these states begin to accelerate to the down side, so to will the narrative of “patient.” I’ll garner it will turn right into outright panic. But there’s a problem.

Interest rate cutting and more money printing won’t help next time. You’ll need far more tools than just a printing press, for the rest of the world is not going to bear that burden any further. The currency markets won’t allow it.

Does one think Russia along with China are going to let the U.S. solve its monetary and economic crises once again by putting their currencies at risk? Along with the political unrest it fosters? You can see these tensions manifesting within the Forex markets everywhere. And as I’ve stated many times before – it’s the Forex markets where you have to keep a keen eye peeled. For this is where the real action happens that everything else follows.

The current new pledges of friendly trade and even friendlier currency swaps excluding the Dollar are happening with far more frequency and in more prominent markets today than probably the last two generations.

Whether they work out over time with signing parties is irrelevant. Just the mere fact that others are not only thinking but actually engaged in the process is a monumental shift. And should literally scare U.S. policy makers to their core. But alas – it seems they either have no understanding, or worse – don’t want to know and don’t care.

And if you think about it why should they? Just look at what the all those people who bump into you are reading. You know, the one’s only concerning themselves with what a “headline” says, or what a tightly dressed, impeccably coiffed headline reader would tell them – like… “Everything Is Awesome!”

A Fool’s paradise is what the once great “land of opportunity” is in real danger of becoming if the adults don’t stop acting like children and actually care about what’s beneath the headlines or between the book covers. Rather than the headlines of who’s between the covers with who.

© 2014 Mark St.Cyr