{"id":11172,"date":"2015-08-18T07:37:15","date_gmt":"2015-08-18T12:37:15","guid":{"rendered":"http:\/\/olduvai.ca\/?p=11172"},"modified":"2015-08-18T07:37:15","modified_gmt":"2015-08-18T12:37:15","slug":"the-wall-street-ponzi-at-work-the-stock-pumping-swindle-behind-four-retail-zombies","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=11172","title":{"rendered":"The Wall Street Ponzi At Work\u2014\u2014The Stock Pumping Swindle Behind Four Retail Zombies"},"content":{"rendered":"<h3 class=\"entry-title\"><a href=\"http:\/\/davidstockmanscontracorner.com\/how-the-wall-street-ponzi-works-the-stock-pumping-swindle-behind-four-retail-zombies\/\" target=\"_blank\">The Wall Street Ponzi At Work\u2014\u2014The Stock Pumping Swindle Behind Four Retail Zombies<\/a><\/h3>\n<p>In the nearby column Jim Quinn debunks Wall Street\u2019s latest claim that the American consumer is bounding back. He\u00a0points out that on an\u00a0inflation-adjusted basis\u00a0retail sales are barely higher than they were\u00a0a year ago, and, for that matter,\u00a0are still\u00a0only 4%\u00a0greater in real terms than they were\u00a0way back in November 2007.<\/p>\n<p>That\u2019s right. Nearly eight years and $3.5 trillion\u00a0of Fed\u00a0money printing later, yet the vaunted American consumer is struggling to stay above the flat line,\u00a0not shopping up\u00a0a storm.<\/p>\n<p>And there is no mystery as to why. After a 40-year borrowing spree culminating in the final\u00a0mortgage credit\u00a0blow-off on the eve of the\u00a0great financial crisis, the US household sector had reached peak debt. It was tapped out with $13 trillion of mortgages, credit cards, auto, student and other\u00a0loans \u2014\u2013a colossal financial\u00a0burden that amounted to nearly 220% of wage and salary income\u00a0<em><strong>or nearly triple the leverage ratio that had prevailed before 1971.<\/strong><\/em><\/p>\n<p><a class=\"image-anchor\" href=\"http:\/\/davidstockmanscontracorner.com\/wp-content\/uploads\/2015\/02\/Untitled16.png\" target=\"_blank\"><img loading=\"lazy\" decoding=\"async\" class=\"size-medium wp-image-41291\" src=\"http:\/\/davidstockmanscontracorner.com\/wp-content\/uploads\/2015\/02\/Untitled16-480x284.png\" alt=\"Household Leverage Ratio - Click to enlarge\" width=\"480\" height=\"284\" \/><\/a><\/p>\n<p>So, as is evident from the graph above, we are now\u00a0in a completely\u00a0different economic ball game\u00a0than\u00a0the consumer\u00a0debt binge cycle that culminated in 2008.\u00a0Households are deleveraging out of necessity, and that means that consumer spending is tethered to the tepid growth of national output and wage income.<\/p>\n<p>Yet\u00a0sell side economists and the\u00a0financial press are so desperate for\u00a0factoids that confirm the Keynesian\u00a0\u201crecovery\u201d narrative\u2014\u2014that is, the false claim that the\u00a0US\u00a0economy has been successfully\u00a0lifted out of a growth\u00a0rut by mega-injections of\u00a0fiscal and monetary\u00a0\u201cstimulus\u201d\u2014\u2014\u00a0that they get just plain\u00a0giddy about Washington\u2019s\u00a0seasonally maladjusted, endlessly revised monthly data squiggles.<\/p>\n<p>Thus,\u00a0in response to the 0.6% gain in\u00a0July retail sales,\u00a0<em><strong>The\u00a0Wall\u00a0Street Journal\u2019s<\/strong>\u00a0<\/em>headline\u00a0proclaimed, \u201cIn a Show of Confidence, Americans Boost\u00a0Spending\u201d.<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Wall Street Ponzi At Work\u2014\u2014The Stock Pumping Swindle Behind Four Retail Zombies In the nearby column Jim Quinn debunks Wall Street\u2019s latest claim that the American consumer is bounding back. He\u00a0points out that on an\u00a0inflation-adjusted basis\u00a0retail sales are barely higher than they were\u00a0a year ago, and, for that matter,\u00a0are still\u00a0only 4%\u00a0greater in real terms [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[4365,1185,5979,2120,195,8222,467,2942,8221,860,8220],"class_list":["post-11172","post","type-post","status-publish","format-standard","hentry","category-economics","tag-borrowing","tag-consumers","tag-contracorner","tag-david-stockman","tag-debt","tag-great-financial-crisis","tag-keynesian-economics","tag-ponzi","tag-us-retail-sales","tag-wall-street","tag-wall-street-ponzi"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/11172","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=11172"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/11172\/revisions"}],"predecessor-version":[{"id":11173,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/11172\/revisions\/11173"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=11172"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=11172"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=11172"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}