2013 Mass Layoffs - Economy is tanking fast again

[OverVolt]

Rebuild from Hurricane Sandy is supposed to start being stimulus for country going forward.

Thats broken window fallacy type stuff.

This is one way China boosts its GDP. They build a bridge, its craftsmanship is so shoddy, trash instead of concrete in the supports, etc, it falls down. So they rebuild it again, two bridges counted toward GDP, only one bridge actually made to service cars.

Same thing in NJ. Fixing what the hurricane destroyed doesn't make anyone wealthier in real terms it just boosts macroeconomic data getting back to where we were before the hurricane. Rebuilding something that was already there doesn't make us any wealthier.

The fact that our recovery is predicated purely on this type of nonesense means it won't be sustained but you all can keep wishing.

 

[sm625]

When they borrow money to rebuild, that money is essentially created out of thin air, with only a balance sheet entry at the Fed to balance it out. So yeah it is going to add to GDP in a major way. What should be of concern to everyone is the fact that despite a trillion dollar a year deficit, for 5 years now, GDP is barely ticking upwards at an anemic rate. That is because so much of the economy is being "havested" by the top 1% and their political/corporate armies. The economic losses of the bottom 99% are really quite staggering given the rapid currency devaluation. Even I expected the bottom 99% to at least gain a little bit over the last 5 years. But they dont really care, so what can you do?