The misleading and fraudulent attempts by the usual suspects in the media this week to dress up disastrous economic news is typical for those who feed at the font of central bank largesse. The propaganda about an improving labor market will likely backfire on those propagating it, however, as it exposes a massive credibility gap between the Wall Street/ K Street version of reality and what is actually being experienced on the ground, by three quarters of the American population. Just to remind everyone, the labor participation rate actually dropped to a level not seen in 36 years (they conveniently buried that fact within the data this morning), while median wages, when adjusted even for biased government inflation figures, have stagnated for at least three decades. Meanwhile, energy, health care and education costs all continue to rise higher and higher, crimping many of the former middle class.
Those at the top had better start learning to read about ancien regime France- a world where an insular and out of touch elite made social tensions worse by not recognizing the need for genuine reforms to better aid their society. In our current day and age, we have the pampered aristocrats of the state-favored industries, living lives increasingly out of touch with the rest of society and then claiming that the forces that produced this state of affairs were natural, that there really isn't much that can be done to spread economic opportunity beyond those who already have it.
As I have written more than once, the public owes it to itself to at least see reality for what it is, and to reconsider leaving vast amounts of wealth with a system that is at least morally, if not financially, bankrupt. You have a choice regarding where to put your money. The vote for gold and silver, notwithstanding what one precious metal commentator recently referred to as the "cult" of metals investing, represents a clear-eyed, moral movement of people trying to take small steps toward envisioning a different society. This should be encouraged, not derided, since too many Americans live in a bubble of dissembling misrepresentation (like what we saw this morning concerning the recovery) that I firmly believe many will one day come to regret.
And reality marches on. Just this week, the Financial Times reported that China will soon pass the United States as the largest economy in the world - whether or not the rate of Chinese growth slows in the months or years ahead. The age of the dollar, while I don't expect it to come to an end tomorrow, is nonetheless coming to a close. The deflationary forces present in the global labor and capital markets remain, and there is increased uncertainty regarding whether or not globalization has hit some kind of plateau, however temporary. I should also add that for all of the bluster regarding cheap energy, the price of oil is stubbornly hanging around the 100 dollar mark.
Reality demands that people look at unconventional places to put at least some of their money. I believe that assets like gold and silver speak for a generation confronting head on the reality that earlier people ignored, and I believe that the spirit of the age belongs to those who learn to see beyond the self-serving spin claiming that everything is just fine.
