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    Daily Digest – June 7

    by Davos

    Sunday, June 7, 2009, 3:07 PM

  • Fed Hires Former Enron Lobbyist to Burnish Its Image
  • Rosy Predictions during the Great Depression: Repeated
  • Times 8 of these (Graphick 8 Stacks would be debt, off balance obligations and stimulus and misc)
  • Solvency: Approximate GDP less imputations (Graphics)
  • Daily Show: The BiG Mess (Video)
  • Housing recovery? (Chart)
  • Stunning, Job loss map dynamic date
  • Mish Speaks at Google (Video) Big Inflation Coming 2
  • Employment Measures and Recessions (Chart)

Economy

Fed Hires Former Enron Lobbyist to Burnish Its Image

This development, that the Federal Reserve has hired one Linda Robertson, former Enron lobbyist and Summers/Rubin protege, to manage relations with the Hill, strikes me as a tacit admission that the Fed thinks it has an Enron scale problem brewing….

Rosy Predictions during the Great Depression: Repeated

As you may have heard, people were making humorously rosy predictions during those bear market rallies:

“The Government’s business is in sound condition.”
Andrew W. Mellon, Secretary of the Treasury
-December 5, 1929

RESERVE BANK AREAS FORECAST NEW YEAR
Despite the obvious slackening of the pace of business at the close of the year, leaders in banking and industry throughout the country maintain an optimistic attitude toward the prospects for 1930.
-January 1, 1930

“The worst is over without a doubt.”
James J. Davis, Secretary of Labor.
– June 1930

‘BUSINESS CYCLE’ SEEN AT NEW PHASE; Bankers Hold Downward Trend in Markets Indicates Recovery Is Near. DENY ANALOGY TO 1920-21 Economists Point to Superior Credit Conditions Now, Holding Easy Money Points to Revival.
-July 6, 1930

BIG BANKERS PUT UP $100,000 SAFEGUARD; House of Morgan Among Those Required to Provide Protection for Investors. -August 3, 1930
“We have hit bottom and are on the upswing.”
James J. Davis, Secretary of Labor.
-September 12, 1930

“30% OF STOCKS SELL UNDER BOOK VALUES; Capital Is Above Market Price.”
-December 14, 1930

“The depression has ended.”
Dr. Julius Klein, Assistant Secretary of Commerce.
– June 9, 1931 (Stock market did bottom one year and 50% later)

Times 8 of these (8 Stacks of debt, off balance obligations and stimulus and misc)

Solvency: Approximate GDP less imputations (Graphics)

Daily Show: The BiG Mess (Video)

Housing recovery? (Chart)

Stunning, Job loss map dynamic date

Mish Speaks at Google (Video) Big Inflation Coming 2

Sadly inflation is woefully misunderstood in popular culture. People tend to think it is simply “rising prices”, but this is incorrect. The formal dictionary definition of this word is “a persistent, substantial rise in the general level of prices related to an increase in the volume of money and resulting in the loss of value of currency”. The key is the rising prices have to be driven by an increasing money supply.

Mish Speaks at Google

[video:http://www.youtube.com/watch?v=1YKc0UolTqE&feature=player_embedded]

Employment Measures and Recessions (Chart)

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